On June 26, 1981, the US Supreme Court ruled, in the McCarty v. McCarty decision, that military retired pay could not be considered community property in divorce. The USFSPA Amendment to Public Law 97-252, served to circumvent the Supreme Court decision in McCarty. The amendment, postdated to June 25, 1981, returned to the states the authority to treat military retired pay, in a divorce action, according to individual state laws and permitted disposable military retired pay to be treated as if it were property accrued during the marriage.

Military retired pay is not a divisible interest prior to retirement by a military member, and as such it should not be considered an asset (property) accrued during a marriage. We contend that awarding a former spouse a share of military retired pay, prior to eligibility of the member, is granting to a former spouse "a greater right to a lifetime divisible interest in the military member's retired pay" than the military member had at time of divorce. Military member eligibility for retirement pay is dependent upon meeting specific requirements, to include 20 creditable years on active duty. Not so for the former spouse in a divorce action that occurs prior to the member's actual retirement.

Another invidious aspect of the USFSPA is that the law permits payments to the non-military former spouse for LIFE, whether or not he or she has remarried. This is inconsistent with the former spouse protections for all other federal agencies, to include:

• civilian federal employees
• US Foreign Service
• Central Intelligence Agency
• Serviceman's Benefit Program of the Department of Defense
• the widows' pension benefit program (DIC) of the Department of Defense
• and the abused military dependents provisions of the USFSPA.

The military member is discriminated against when these agencies stop payments to the remarried former spouse, but the military member, without such protections, must continue payments for life. Additionally, payments to former military spouses, through the Defense Finance and Accounting Service (DFAS), are derived from all post-divorce career advancements and pay increases, allowing former spouses a monetary windfall when the member retires often many years after a divorce.

1982 PL 97-252 Uniformed Services Former Spouses Protection Act (USFSPA)

• Grants state courts the authority, under specific conditions, to treat military retired pay in the same manner they treat other * pensions in accordance with individual state domestic relations law
• Authorizes service members to designate a former spouse as beneficiary under the Survivor Benefit Plan (SBP) (Prospective only).
• Authorizes commissary and exchange privileges and care in military medical facilities or under the Civilian Health and Medical Program (CHAMPUS) for unremarried former spouses who were married for at least 20 years during active duty service, if divorced after 1 February, 1983.
• Provides for direct payment from the finance centers of child/spousal support or a percentage of the pension awarded the former spouse.

• Enables a former spouse of an active duty service member to file for involuntary allotments to be taken from the members's monthly pay for payment of overdue spousal and/or child support without having to pursue court proceedings.

• Allows military members who divorced before USFSPA to designate a former spouse as beneficiary of the Survivors Benefit Plan (SBP) if member was a participant at the time of retirement.

• Extends military medical care and shopping privileges to 20-20-20 former spouses regardless of the date of divorce and medical care only to the 20-20-15 former spouses divorced before 1 April, 1985.
• Directs DOD to develop a plan for all former spouses to convert from military medical care to a private health insurance plan. Extends military care for former spouses for two years or until health plan is in place to 20-20-15 former spouses divorced after 1 April 1985.
• Enables the former spouse to ask for a "deemed election" of the SBP if member does not file the application

• Requires spousal concurrence for member to waive SBP or select less than the maximum.
• Creates a two tier system (55% until age 62, 35% after) for the SBP instead of social security offset, benefiting those already enrolled to be computed under most favorable system.
• Creates new former spouse and former spouse and child categories with lower premiums than former insurable interest category.

• Allows state courts to order that the former spouse be designated as SBP beneficiary.
• Extends medical coverage for 20-20-15 former spouses until health plan is in place.
• Lowers the age at which a surviving spouse or former spouse may remarry without losing SBP benefits from 60 to 55.
• Limits the deduction of Chapter 61 disability pay in determining disposable income to percentage awarded to former spouse at the time of retirement.
• Eliminates the deduction for life insurance premiums in determining disposable income for former spouse award therefore increasing the amount of award.

• Extends medical care for certain former spouses from 1 April 1988 until 31 December 1988.

• Benefits for former spouses already enrolled in SBP to be computed on most favorable basis.

• Changes the cost of the SBP to a straight 6 ½% except for a few with a low base amount who are grandfathered in.

• Prohibits reopening of pre-McCarty cases for the purpose of dividing the pension. Places a two year limit (Until November 1992) on payments to those who did reopen pre-McCarty cases and were awarded a share of the *pension.
• Redefines disposable income to eliminate deduction of taxes and personal debts for those divorced after 4 February 1991, therefore benefiting the former spouse with a larger amount of award.

• Provides annuities for spouses or former spouses when military member loses eligibility for *pension because of abuse to dependent. (This annuity to the spouse or former spouse stops upon remarriage.)

• Transfers the *pension benefits awarded to the former spouse during divorce from a military to a civil service pension, if the spouse rolls the military pension into a civil service pension.
• The authorization by Congress to allow military members to designate a former spouse as beneficiary under the SBP was enabling legislation. This amendment permitted the courts to "order" that the former spouse be designated as SBP beneficiary.
• The 1990 amendment prohibiting the reopening of pre-McCarty cases for the division of retired pay is not being upheld in all state courts.
• To address the taxability of payments of retired pay to a former spouse, 10 U.S.C. 1408(c)(2) was amended to state that disability payment would not be considered as wages of the member in determining his or her gross income. Although USFSPA clearly states that disability pay is not to be divided, some state courts have chosen to disregard this portion of the law. Title 42 also states - without a doubt - that disability pay is to be held sacrosanct.

If you would like to read "U.S. Code, Title 10, Computation of Retired Pay, Sec. 1408. Payment of retired or retainer pay in compliance with court orders", in its entirity, click on the link below: