Are you or your spouse an active or retired military service member?
Call to schedule your FREE 15-minute mediation phone consult with Denisa who is versed in the unique issues of military divorces. 888-610-6362 (Office locations: Denver and Colorado Springs)
If so keep reading and arm yourself with information. Military divorces poses unique challenges than civilian divorces. Sadly many divorce professionals are not versed in the rules of military divorces and can cost clients disastrous mistakes and unnecessary litigation after divorce.
Have you been married to a military member for 20 years overlapping his/hers 20 years of creditable service?
Spouses who have been married to service members for 20 years overlapping their 20 years of creditable services are entitled to full military medical care, including Tricare, if the non-military spouse is not enrolled in an employer-sponsored health plan, and other benefits, like commissary and exchange privileges. Not knowing about these special benefits and other nuances of military divorces can cost you big time!
Have you been married to a military member for 20 years overlapping his/hers 15 years of creditable service?
Non-military spouses who were married 20 years to a service members overlapping his 15 years of creditable service are entitled to a full medical coverage but no other benefits or privileges. If the Decree was issued on or after 4/1/1985, then the former spouse is entitled to medical care for one year from the date of divorce, dissolution, or annulment. If there is no eligibility for health coverage, the spouse can get covered under Continued Health Care Benefit Program if she/he files within 60 days. The coverage will last 36 months.
Are you or your spouse collecting military pension?
There are special rules to divide up military retirement in divorce and ensure that you continue to receive your share in the event that your military spouse predecease you. Once you receive your Decree it is critical that you file the proper paperwork with Defense of Financial and Accounting Services (DFAS) within a specific timeline to divide up the retirement and secure your survivor benefit.
Do you prefer to keep your military pension intact and buy out your spouse?
The benefit of the mediation process and working with a Certified Divorce Financial Analyst (CDFA) who is versed in complex financial issues of military divorces, is that you and your spouse can work out a creative equitable financial scenario. During the mediation process you can come up with outside of the box options.
Do you or your spouse collect VA disability?
Special rules apply in divorce when it comes to VA disability payments. Not knowing them can cost you big time.
Does your spouse have active service credits as well as reserve service credits?
This is another challenging area that can cause costly mistakes in the final settlement if the service credits are not allocated properly.
Military Divorces differ from civilian divorces
Military divorces sometimes include elements that make them more complicated than civilian divorces. “Military couples must be aware of factors that affect their divorce as a result of military service,” states Certified Divorce Financial Analyst and Divorce Mediator Denisa Tova. Tova has beefed up that part of her practice because of the large military presence in the Colorado area. She is also a mother to a son who has served in the US Navy.
Military divorce requires a special knowledge of laws and familiarity with issues, including:
- Military pay
- Military retirement pay
- Military Disability pay
- Military pension division orders through Defense Finance and Accounting Services (DFAS)
- Survivor benefit plan (SBP)
- Military housing
- Medical and other military benefits
- Separation bonuses
- Transfers to the Reserve/Guard
- Uniform Services Former Spouses’ Protection ACT
Arm yourself with information
Denisa Tova offers the following tips to help you navigate the roadblocks and landmines often present in military divorce:
- Track and understand gross income and all factors that impact your Modified Adjustable Gross Income (MAGI).
- Be aware of the Combat zone exclusion – If you served in a combat zone, a portion of your pay can be excluded from your income.
- Be aware of the 2003 Military Family Tax Relief ACT – This relates to the sale of the home, often resulting in relocation. The new law offers an exception to the use and ownership (2 out of 5 years) rule for the service members in “qualified official extended duty.” The rule is extended from five years to ten years for the single property.
- Take advantage of education credits – You are entitled to tax credits or deductions if you, your spouse or a dependent is enrolled in a college or vocational school.
- Be aware of the automatic two-month extension – Check with your accountant to make sure you qualify.
- Permanent Change of Station and Child Tax Credits – Taking advantage of these credits can alleviate the cash flow burden on moving families.
- Falling short of 20 years – Divorcing before the service member attains 20 years of creditable service to qualify for full medical coverage or retirement pay can be detrimental to the non-military spouse.
- Military pensions subject to different rules than QDRO – Divisible in the event of divorce, military pensions are subject to different rules than the Qualified Domestic Relations Orders (QDRO) for private retirement accounts or Domestic Relations Orders (DRO) for state and municipal pensions.
- Alimony and child support – are also subject to special rules.
- Lodging or food in lieu of BAH or BAS – Colorado family law courts also assign/credit income to a servicemember who receives lodging or food in lieu of BAH or BAS.
- Military housing is considered an “in-kind payment” – much like a company car provided by a private-sector employer.
Heightened efforts to protect the U.S. require a strong military presence at home and abroad. Some American soldiers are on their third or fourth combat tour – 15 months away from home with just 18 days’ leave. The strain is showing on their relationships. Military divorce rates among the military are on the rise. That said, there appears to be a rise in military divorces following deployment. As a military family, you have chosen to serve your country. On the home front, it’s just as important to take care of yourself and your future.
Every divorce is unfortunate and stressful; the additional stress of a military divorce can make it even more difficult to make necessary decisions for the good of the family. When divorce is inevitable, it’s important to do your financial homework. Don’t go it alone. If necessary, seek professional help from a divorce financial analyst who can help you avoid the financial pitfalls so common when emotions affect decision-making.