When the National Defense Authorization Act for Fiscal Year 2017 became law on December 23, 2016, it did not garner much attention. If people knew that a subtle clause within the paperwork impacted the split retirement pay of divorcing active duty military members, it may have caught more eyes and headlines.
When the act was signed, it also turned official some rewrites to the Uniformed Services Former Spouses’ Protection Act (USFSPA). In particular, it required pensions pending division due to a military divorce be split as if the current military service member had actually retired on the day the court ruled the pension as marital property to be considered in the divorce. A small number of states use a “snapshot” rule to view the retirement benefits at the time of the pension’s division; the rest use a “time” rule to allocate portions of all pensions, military or otherwise, between the divorcing spouses. The time rule is based on the ultimate retired pay amount given to the service member since the pension account began. In the typical divorce, this will mean that half of the pension service amount will be given to the former spouse.
The revisions also mandates that a “frozen benefit rule” be followed, which includes these keynotes:
- Changes to USFSPA are immediate and impact any applicable benefit created on or after December 23, 2016.
- Divorcing spouses that each have retirement pensions pending marital property division can be regulated under two different pension division rules, so long as one is still controlled using the frozen benefit rule created with the act revisions.
- Frozen benefits may be subject to increases if there is a significant amount of time between the court’s ruling and the real date of the military service member’s retirement.
- High Three continuous compensation averages may or may not still be used to calculate future retired pay bases for military pension cases reviewed by the Defense Finance and Accounting Service.
- Rewritten provisions will be applied to all relevant cases and spouses entering into a military divorce cannot petition to have the orders dismissed for their particular case; it must always be used.
- Some official regulations applicable to the frozen benefit rule have not been recorded officially; married or divorcing military service members should anticipate some changes or additional announcements in the future.
As it can be seen just from the language used with the USFSPA, this is a highly complex and intricate area of military divorce law. If you are going through a divorce and think that your retirement pensions could be impacted by the revisions, you should not try to navigate the system alone and guess about what could be the right call. Instead, work with Weis Law Group and our Columbus family lawyers to figure out the next steps. We are backed by years of experience, led by an OSBA certified specialist in family relations law, and were recently honored with the Best Lawyers® Best Law Firms® award for 2017.