Readers of Tom Philpott's Military Update column sound off.

Thrift Savings Plan Enrollees Should Know 'Spousal' Rules  

"Spousal Protection Features" of the federal government's Thrift Savings Plan (TSP) are not being explained to the troops in a clear precise manner.  So let me provide specifics:

-- No withdrawals of TSP funds are allowed without your spouse's written notarized permission.

-- Your spouse automatically is entitled to one half of your TSP!

-- If you lie and say you can't find your wife to get her permission before taking out money, it is a crime!

-- On the TSP web page is a blank court order form for the wives to take to any judge in the United States which, when signed, can be mailed to the Defense Finance and Accounting Service to get your TSP.  All she has to do is fill in the blanks and go judge shopping!

There are many other features of TSP that everyone should be made available of.

LARRY SIMMERMAN
Via e-mail

Tom Trabucco, spokesman for the Federal Retirement Thrift Investment Board which manages TSP, verified much of what you say and clarified other points. Spousal protection features should be well understood by TSP participants before they sign up.

Trabucco explained that Congress extended to members of the uniformed services the same spousal protection requirements for the TSP that it mandated for civilian participants covered by the Federal Employees Retirement System (FERS).  By law the spouse of a FERS participant is entitled to a joint & survivor annuity with a 50 percent survivor benefit.  This type of annuity gives you a 100 percent monthly benefit payment while you are alive.  If you predecease your spouse, he or she receives a 50 percent monthly benefit payment for the remainder of his or her life.  It is a fairly standard annuity product, he said, and closely tracks the payout structure of the defined benefit retirement programs for federal civilians.

To protect this entitlement, the law requires, as you noted, that a spouse consent to any other type of withdrawal choice.   Also, the Board does require a notarized signature by the spouse as an additional safeguard because money, once disbursed, generally cannot be reclaimed.

To your second point, Trabucco said no law or regulation "entitles" a spouse to 50 percent of the TSP balance upon divorce.  But Congress has authorized state courts to treat the TSP account as a marital asset and to award a portion of it to the spouse in accordance with applicable state law and the merits of the case.

Third, participants certify their marital status when they submit a TSP withdrawal form and must acknowledge that an intentional false statement or willful misrepresentation is punishable by law (18 U.S. Code, Section 1001.)  The participant thus understands that lying to the government to frustrate spousal rights is a crime.

On your last point, Trabucco noted that the TSP court order booklet, Web site and regulation do provide standard language for use by judges to help ensure their orders are issued in a way that qualifies under the TSP authorizing legislation.  These are not fill-in-the-blank forms but templates that an attorney or judge can modify to create an order acceptable to the TSP.

"This facilitates the efficient administration of judicial decisions and helps ensure that the court's award fulfills the expectations of participant and spouse," Trabucco said.  He added, "An order that fails to follow the sample language, while enforceable, may require the TSP to distribute an amount that neither party contemplated."

The spousal protections listed here apply not only to TSP withdrawals but to loans as well.  -- Tom Philpott

Paid-up SBP

I retired from the Air Force in July 1978.  I am now 73 years old.

Am I right in assuming that, effective this October, my Survivor Benefit Plan premiums will be paid in full and I no longer will contribute to it?

If so, when and how will I be notified of this change?

J. SMITH

Yes,  reductions in retired pay to cover SBP premiums will terminate Oct. 1, 2008, for eligible retirees -- those who have reached age 70 and have paid SBP or Retired Servicemen's Family Protection Plan (RSFPP) premiums for at least 30 years.

The Defense Finance and Accounting Service is reviewing all military retiree accounts affected.  Retirees will be notified by mail of their account status and stoppage of premiums.  Retirees with questions can call DFAS at 1-800 321-1080 – T. P.

The Allowance Argument

Congress, in weighing the argument of the 10th Quadrennial Review of Military Compensation that a military pay gap with civilian peers doesn't exist today if one counts gains in housing allowances, should consider the following:

Military-provided housing or Basic Allowance for Housing, and military-provided food or Basic Allowance for Subsistence, are not counted in calculating military retired pay.  So these payments should not count toward closing the pay gap when it is convenient for the government to consider in comparing military pay levels with civilians.

Also, military personnel are required to move far more often than civilian counterparts so they see lose money to un-reimbursed moving expenses.

KEVIN S. THOMAS
Master Sergeant, South Carolina Air National Guard
Eastover, S.C.

Letters may be edited for clarity or length.  Write to Military Forum, P.O. Box 231111, Centreville, VA  20120-1111, send e-mail to militaryforum@aol.com or visit www.militaryupdate.com.