Paying back Seperations Pay

[foresteronw]

Hey all, my first of hopefully many posts on here.

Quick history, I joined the USMC in 1994, in 2003 I got pnuemonia really bad and the infection scarred up my lungs. On top fo the scar tissue I developed asthma. I fought the USMC to let me stay in, I was coming up on the half way point and already a 2 year SSGT. Long story short I lost the battle and had to get out. I was not retired but was given seperations pay for the asthma.

Once out I hooked up with the VA for disability compensation. They informed me I had to pay back my seperations pay, which although I didn't want to I understood the reasoning.

Now, one of my friends who was forced out for not getting promoted to SSGT by his 13 year mark was given seperations pay as well. Just this week he got his rating from the VA and they are not taking back any seperations pay from him?

Now, I asked him if he told them he recieved it, in the worries that they would pull it from him in a couple of years. He assured me that he did. Now, I don't expect him to lie to me about something like this, and for his sake I hope he did tell them.

Keep in mind he did not get seperations pay for a medical reason, he got it for not being allowed to reenlist do to not getting promoted.

Has anyone every heard of this?

[MotherGoose]

I haven't heard of it, but anything is possible. I got medically discharged and received a lump sum. The VA takes half of my monthly disability check until it is paid back (in 2012). This may be...

[OB MSG]

Can't say that I have, but I do know that you should go in and complete your profile before any more Marines take a look at it. Also, if you were a SSgt when you got out then you need to change your Tag because right now you have no rank showing and your profile says you're a Private.

[foresteronw]

There we go, should be all fixed. <br />
<br />
See here is the way i'm seeing it. To me it doesn't make sense. I was forced to leave the USMC because of a medical condition I developed while on active duty....

[Phantom Blooper]

Severance pay for medical the VA will give you a disability rating but they will take out a certain percentage to recoup severance while you are drawing a VA rated disability check if you want to continue to receive VA disability.

Eventually it will catch up with him.Here is the USC 10.:evilgrin:

http://www4.law.cornell.edu/uscode/10/usc_sec_10_00001174----000-.html

[foresteronw]

Yeah I understand the severance pay and paying it back when you are medically discharged but the thing is he was not medically discharged. He was not allowed to re-enlist because he didnt' get...

[Phantom Blooper]

In my opinion I wold go to the county VA office and have them look in to it....my reasoning....the VA has a habit of doing things when one least expects them to.

They give an opportunity for appeal process but from my experience at the DAV and other service organizations the VA usually prevails in the end.

I would have someone look into this as from what I am told the VA considers somethings like this double dipping.:evilgrin:

[foresteronw]

Phantom, I just got done reading the link you provided and I think you're right, sounds like he should be paying it back.

I was hoping he wouldn't have to but I wanted to understand the difference.

[Quinbo]

News I didn't want to hear.

[Petz]

from my understanding of the 13 and out severance is that it's because the Marine Corps doesn't want you anymore... not because of medical issues but because you couldn't make the grade.

As for you, you were not mission capable.... so they gave you a lump and said sorry the military messed you up... have a great life... from that point it's up to you to decide about VA disability or not, then if you took that lump from the MC you'll have to pay it back in order to get a stipend for the rest of your life.

Back to the 13 and out... you got booted for other than medical reasons.... you still rate medical disability just as if you EAS'd.... so why would you pay back a severance that has nothing to do with medical seps?

I see why you are asking but I don't think your friend has a problem here.. the VA does not give out money as a 13 and out severance package... it's for medical reasons.


Semper Fi Brothers.

[SgtDBrownRet]

Severance pay due to medical and earlier outs will have to be recouped by the VA at the amount paid to the veteran after taxes. Imedical will be recouped at the amount of military percentage. the infomation is in the 38 C.F.R Part 3. I do not have my book with me at home, but I think it is subpara 3.700. I'm not sure but I can have it for you tomorrow.

[Petz]

well it's beyond tomorrow... where's it at and what are you talking about? you mean paying back disability or mediacal seps? I get the severance and earlier outs.... help me out here partner.

[foresteronw]

Well I asked my brother in-law who was discrhaged for for not picking up SSGT in 13 years, same reason my friends was forced out. He said he is not getting his VA disability pay because he is having to pay back his seps pay. He DID NOT get forced out for medical reasons. So I guess that should answer my question.

[KawiGunny]

There is a big difference in the type of pay you both recieved when leaving the Corps. His was because his services were no longer needed and he had to get out. Not because of a medical condition. Therefor he can claim as many medical problems as he wishes. Provided they are documented.

You on the other hand accepted compensation for a medical problem when you got out. It was their way of paying you off. Yes you do have to either repay the compensation they paid you or just file your claim with the other med problems you might have. I would definitely consider repaying the money because long term...... The VA will pay more (depending on if you invested the money or not).

I have seen a lot of people accept the pay when leaving the service and end up in the same boat as you are. The military won't tell you about the VA part because it saves money in the long term to pay you a good chunk of change when you get out. People all to often look and the check and all they see is a good dollar sign at the moment and not at what their health will be like in five years.

[foresteronw]

KawiGunny,

I never said that what we recieved is the same, I understand what the difference is and what my options were. I got out in 2004 and have gotten settled in the VA system several years ago.

What I was hoping to find on here was a way to explain to him that he will have to "pay back" his seps pay to recieve his VA disability every month.

[oldtop]

It makes no difference..Seperations pay must be repaid before you can begin to receive VA compensation. If it was due to medical reasons or because of any other reason (like reenlistment being denied for failure to make rank, reduction in force, etc.). If you were seperated prior to 1994, you not only have to pay back the seps pay you received, you also have to pay back the taxes that were withheld (GROSS amount of seps pay), but persons seperated after 1994 only have to repay the NET amount, how bout them apples!!! Incidentally, this rule also applies to those that decide to remain in service via reserve duty in order to retire. Get RIFed from active duty, remain in the reserves and retire with 30 years service, and at age 60 youe retirement pay starts...right.....WRONG! If you received any seperations pay when you were RIFed, it must all be paid back before you can collect your retirement. Funny thing is that DFAS WILL start your retirement pay on time, but about 6 months later your pay will be reduced by more than half to pay back the seps pay. If the VA has already recouped your seps pay, you have to get the VA to notify DFAS that the money has been paid back before they will reinstate your full retirement pay.

[KawiGunny]

Good info Top. Learn something new everyday.

[SgtDBrownRet]

Sorry, I have hearings all this week, been frazzeled. Here is the section and the location on the internet link. I underlined the section that deals with seps pay. Link may not work. Do a google of 38 C.F.R. part 3

http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=fad27fdb1f36e27597f59a752d52cb88&rgn=div8&view=text&node=38:1.0.1.1.4.2.73.218&idno=38

3.700 General.
Not more than one award of pension, compensation, or emergency officers', regular or reserve retirement pay will be made concurrently to any person based on his or her own service except as provided in §3.803 relating to naval pension and §3.750(c) relating to waiver of retirement pay. Not more than one award of pension, compensation, or dependency and indemnity compensation may be made concurrently to a dependent on account of more than one period of service of a veteran.
(Authority: 38 U.S.C. 5304(a))
(a) Veterans —(1) Active service pay. (i) Pension, compensation, or retirement pay on account of his or her own service will not be paid to any person for any period for which he or she receives active service pay.
(Authority: 38 U.S.C. 5304(c))
(ii) Time spent by members of the ROTC in drills as part of their activities as members of the corps is not active service.
(iii) Reservists may waive their pension, compensation, or retirement pay for periods of field training, instruction, other duty or drills. A waiver may include prospective periods and contain a right of recoupment for the days for which the reservists did not receive payment for duty by reason of failure to report for duty.
(2) Lump-sum readjustment pay. (i) Where entitlement to disability compensation was established prior to September 15, 1981, a veteran who has received a lump-sum readjustment payment under former 10 U.S.C. 687 (as in effect on September 14, 1981) may receive disability compensation for disability incurred in or aggravated by service prior to the date of receipt of lump-sum readjustment payment subject to deduction of an amount equal to 75 percent of the amount received as readjustment payment.
(Authority: 38 U.S.C. 501)
(ii) Readjustment pay authorized under former 10 U.S.C. 3814(a) is not subject to recoupment through withholding of disability compensation, entitlement to which was established prior to September 15, 1981.
(Authority: 38 U.S.C. 501)
(iii) Where entitlement to disability compensation was established on or after September 15, 1981, a veteran who has received a lump-sum readjustment payment may receive disability compensation for disability incurred in or aggravated by service prior to the date of receipt of the lump-sum readjustment payment, subject to recoupment of the readjustment payment. Where payment of readjustment pay was made on or before September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of readjustment pay. Where payment of readjustment pay was made after September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of readjustment pay less the amount of Federal income tax withheld from such pay.
(Authority: 10 U.S.C. 1174(h)(2) and 1212(c))
(iv) The receipt of readjustment pay does not affect the payment of disability compensation based on a subsequent period of service. Compensation payable for service-connected disability incurred or aggravated in a subsequent period of service will not be reduced for the purpose of offsetting readjustment pay based on a prior period of service.
(Authority: 10 U.S.C. 1174(h)(2))
(3) Severance pay. Where the disability or disabilities found to be service-connected are the same as those upon which disability severance pay is granted, or where entitlement to disability compensation was established on or after September 15, 1981, an award of compensation will be made subject to recoupment of the disability severance pay. Prior to the initial determination of the degree of disability recoupment will be at the full monthly compensation rate payable for the disability or disabilities for which severance pay was granted. Following initial determination of the degree of disability recoupment shall not be at a monthly rate in excess of the monthly compensation payable for that degree of disability. For this purpose the term “initial determination of the degree of disability” means the first regular schedular compensable rating in accordance with the provisions of subpart B, part 4 of this chapter and does not mean a rating based in whole or in part on a need for hospitalization or a period of convalescense. Where entitlement to disability compensation was established prior to September 15, 1981, compensation payable for service-connected disability other than the disability for which disability severance pay was granted will not be reduced for the purpose of recouping disability severance pay. Where entitlement to disability compensation was established on or after September 15, 1981, a veteran may receive disability compensation for disability incurred or aggravated by service prior to the date of receipt of the severance pay, but VA must recoup from that disability compensation an amount equal to the severance pay. Where payment of severance pay was made on or before September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of the severance pay. Where payment of severance pay was made after September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of the severance pay less the amount of Federal income tax withheld from such pay.
(Authority: 10 U.S.C. 1174(h)(2) and 1212(c))
(4) Improved pension. If a veteran is entitled to improved pension on the basis of the veteran's own service and is also entitled to pension under any pension program currently or previously in effect on the basis of any other person's service, the Department of Veterans Affairs shall pay the veteran only the greater benefit.
(Authority: 38 U.S.C. 1521(i))
(5) Separation pay and special separation benefits. (i) Where entitlement to disability compensation was established on or after September 15, 1981, a veteran who has received separation pay may receive disability compensation for disability incurred in or aggravated by service prior to the date of receipt of separation pay subject to recoupment of the separation pay. Where payment of separation pay or special separation benefits under section 1174a was made on or before September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of separation pay or special separation benefits. Where payment of separation pay or special separation benefits under section 1174a was made after September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of separation pay or special separation benefits less the amount of Federal income tax withheld from such pay.
(ii) The receipt of separation pay does not affect the payment of disability compensation based on a subsequent period of service. Compensation payable for service-connected disability incurred or aggravated in a subsequent period of service will not be reduced for the purpose of offsetting separation pay based on a prior period of service.
(Authority: 10 U.S.C. 1174 and 1174a)
(b) Dependents —(1) Surviving spouse. Subject to the provisions of paragraph (a)(4) of this section, the receipt of pension, compensation, or dependency and indemnity compensation by a surviving spouse because of the death of any veteran, or receipt of pension or compensation because of his or her own service, shall not bar the payment to the surviving spouse of pension, compensation, or dependency and indemnity compensation because of the death or disability of any other veteran; however, other than insurance, concurrent benefits under laws administered by the Department of Veterans Affairs may not be authorized to a surviving spouse by reason of the death of more than one veteran to whom the surviving spouse has been married. The surviving spouse may elect to receive benefits based on the death of one such spouse and the election places the right to benefits based on the deaths of other spouses in suspense. The suspension may be lifted at any time by another election based on the death of another spouse. Benefits payable in the elected case will be subject to prior payments for the same period based on the death of the other spouse where, under the provisions of §3.400(c), there is entitlement in the elected case prior to date of receipt of the election.
(Authority: 38 U.S.C. 5304)
(2) Children. Except as provided in §3.703 and paragraph (a)(4) of this section, the receipt of pension, compensation, or dependency and indemnity compensation by a child on account of the death of a veteran or the receipt by the child of pension or compensation on account of his or her own service will not bar the payment of pension, compensation, or dependency and indemnity compensation on account of the death or disability of any other veteran.
(3) Parents. The receipt of compensation or dependency and indemnity compensation by a parent on account of the death of a veteran or receipt by him or her of pension or compensation on account of his or her own service, will not bar the payment of pension, compensation, or dependency and indemnity compensation on account of the death or disability of any other person.
(Authority: 38 U.S.C. 5304(b))

[foresteronw]

Thans man

[SgtDBrownRet]

Thans man

"man" you talking to me?

[Ironman9]

Maybe he gets both, because he had to lead from the front and be the backbone for more than half his career, where as a Staff Sergeant who picks up in 4-6 years doesn't. As an NCO, if your doing...

[SgtDBrownRet]

I agree, now all we have to do is get congress to agree. They are just getting around to trying to give retirees their retired pay and their VA pay. The only job that you can't get your retired pay and VA compensation. It's not right, and on one is hating, but if we as veterans don't get these laws changed to start benefiting us, we are going to lose alot to these bailouts.

That's why I posted the VA Claims Tips. That 9 - 12 year Marine may have been eligible for medical retirement instead of seps pay. The VA and the military both uses the same criteria to rate disablities. Many don't know that and just get out with the lump sum, and it comes back to bit them in the butt, due to the "double dipping" laws.

[Petz]

Sgt D,

you know what you're talking about... that's good... and as the older salts have put it, you should pay back the seps and take the VA benefits.

if you can, take out a loan to pay it back then use your new money from the VA to pay it off... or scrape the cash together.