Military Pensions as Marital Assets in Florida
Military retired pay is often the most valuable asset in a military divorce. Under Florida's equitable distribution framework established by Florida Statute 61.075, a military pension earned during the marriage is a marital asset subject to division, just like a civilian 401(k) or defined benefit plan.
However, dividing military retirement pay involves a distinct federal overlay that does not apply to civilian retirement accounts. The Uniformed Services Former Spouses' Protection Act (USFSPA), codified at 10 U.S.C. 1408, governs whether and how state courts may divide military retired pay.
The Uniformed Services Former Spouses' Protection Act
USFSPA does not require states to treat military retired pay as divisible property. Rather, it permits state courts to do so in accordance with their own property division laws. Florida courts have consistently exercised this authority.
Key USFSPA provisions include:
- State courts may divide disposable retired pay as part of a divorce or dissolution proceeding
- Disposable retired pay is the gross retired pay minus certain deductions, including disability pay, SBP costs, and amounts owed to the government
- The former spouse's share cannot exceed 50 percent of disposable retired pay through direct DFAS payments (though a court can award more through other mechanisms)
- Jurisdiction requires that the service member be domiciled in Florida, reside in Florida, or consent to the court's jurisdiction
The 10/10 Rule Explained
The 10/10 rule is one of the most misunderstood aspects of military divorce. It provides that the Defense Finance and Accounting Service (DFAS) will make direct payments to the former spouse only when the marriage overlapped with at least 10 years of creditable military service.
Critical clarifications about the 10/10 rule:
- It does not determine whether the pension is divisible. Even if the marriage lasted only two years, the marital portion of the pension remains subject to equitable distribution under Florida law.
- It only controls the payment method. If the 10/10 threshold is met, DFAS sends payments directly to the former spouse. If not, the service member must make payments directly to the former spouse per the court order.
- Enforcement becomes more complicated without direct DFAS payments, since the former spouse must rely on contempt proceedings or other enforcement mechanisms if the service member fails to pay.
Calculating the Marital Portion
Florida courts typically use the time rule (also called the coverture fraction) to determine the marital share of military retired pay:
Marital Fraction = Months of marriage overlapping with military service / Total months of creditable military service at retirement
This fraction is then applied to the disposable retired pay to determine the marital portion. The court divides the marital portion equitably, which in Florida means fairly but not necessarily equally.
For example, if a service member served 20 years (240 months) and was married for 15 of those years (180 months), the marital fraction would be 180/240, or 75 percent. If the court awards the former spouse 50 percent of the marital portion, the former spouse would receive 37.5 percent of disposable retired pay.
CRDP vs. CRSC: The Disability Pay Complication
One of the most contentious issues in military pension division involves disability pay offsets. Federal law generally prohibits the division of VA disability compensation. Two programs create particular complications:
- Concurrent Retirement and Disability Pay (CRDP) allows qualifying retirees to receive both full retired pay and VA disability compensation. CRDP is considered disposable retired pay and is divisible under USFSPA.
- Combat-Related Special Compensation (CRSC) replaces retired pay that was waived due to VA disability compensation for combat-related disabilities. CRSC is not divisible under USFSPA and is paid directly to the service member.
When a service member elects to waive retired pay in favor of VA disability compensation, the former spouse's share of disposable retired pay decreases. Florida courts have addressed this issue in various ways, including ordering the service member to indemnify the former spouse against reductions caused by post-divorce disability elections.
The Survivor Benefit Plan
The Survivor Benefit Plan (SBP) provides a monthly annuity to a designated beneficiary if the retiree dies. In a divorce context, SBP coverage for the former spouse ensures that the pension share does not terminate upon the service member's death.
Important SBP considerations:
- Election must be made within one year of the divorce or the court order dividing the pension
- A deemed election may apply if the divorce decree awards SBP coverage and the service member fails to elect it
- SBP premiums are deducted from gross retired pay before calculating disposable retired pay
- Former spouse coverage terminates if the former spouse remarries before age 55, though coverage can be reinstated if that subsequent marriage ends
Drafting the Court Order
DFAS has specific requirements for court orders dividing military retired pay. A poorly drafted order can result in DFAS rejecting the application for direct payment. The order should:
- Identify the service member and former spouse with full names, Social Security numbers, and dates of birth
- Specify the award as a fixed dollar amount, percentage of disposable retired pay, or formula using the time rule
- Address survivor benefit plan elections explicitly
- Include CRDP/CRSC language to protect the former spouse against disability offsets
- Comply with DFAS formatting requirements to avoid rejection and delays
Protecting Your Interests
Military pension division requires careful attention to both federal and Florida law. Whether you are the service member or the military spouse, understanding USFSPA, the 10/10 rule, and the interplay between retired pay and disability compensation is essential to achieving a fair division of this significant marital asset.