San Antonio firm explains retirement and disability pay rules in military divorce

The Law Firm of Joseph Lassen has released an explanation of how military retirement pay and VA disability compensation are handled in Texas divorces, ahead of Veterans Day on November 11. The San Antonio firm's release addresses financial questions for military families in a city that is home to Joint Base San Antonio.

The firm's explanation distinguishes between whether retirement pay can be divided and how a former spouse receives an awarded share. It also describes why exchanging some retirement pay for VA disability compensation can affect payments after a divorce.

According to the firm, the Uniformed Services Former Spouses' Protection Act allows courts to treat a service member's disposable retired pay as property under the law of the state hearing the case. In Texas, a community property state, courts must make a division of marital property that is just and right, rather than necessarily dividing it equally.

Direct government payment has a separate requirement, the firm explains. Under the 10/10 rule, the marriage must have lasted at least 10 years during which the service member performed at least 10 years of creditable military service. That requirement governs whether the government pays the former spouse's share directly.

A marriage that does not meet that threshold can still result in a court awarding a share of retirement pay, according to the release. The firm says the distinction matters when drafting the order because the rule affects the payment method.

VA disability compensation generally cannot be divided in a divorce, the firm says. Some retirees waive part of their military retirement pay to receive disability compensation instead, and federal law excludes that waived portion from the retirement pay available for division.

The release cites the U.S. Supreme Court's 2017 decision in Howell v. Howell. According to the firm's explanation, the court held that a state court cannot require a veteran to reimburse a former spouse for retirement payments lost because of a later waiver for VA disability compensation.

The firm urges families to consider a possible waiver before finalizing a divorce settlement or decree. Its explanation emphasizes that the wording of those documents matters when planning for how retirement and disability benefits may affect future payments.