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Survivor Election and Military Retirement in AZ | Hildebrand Law

Wed 1st Aug, 2018 Arizona Community Property Laws

A person in the military may earn a military retirement that may be divided between spouses in divorce in Arizona.

The question is can a military spouse protect against a reduction in military retirement benefits awarded to that spouse in divorce in Arizona.

Survivor elections and reduction of a spouse’s share of military retirement in an Arizona divorce are not unusual to occur well after a divorce. As an example, suppose a couple gets divorced.

The wife is in the military and the husband is not in the military.

Wife is eligible to return at some point in the future but after the spouses’ divorce.

The court will award the husband a portion of the retirement benefits pursuant to the terms of the divorce decree.

Let’s say the amount husband will receive after all the calculations are done is $500.00 every month and the wife receives $1,000.00 every month after the service member retires.

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However, after the divorce Wife remarried and has chosen a survivor benefit election that guarantees her current husband will continue to receive her monthly retirement benefits if she passes away.

Wife’s decision to choose the survivor benefit election will necessarily reduce the amount both she and her former husband receive every month.

The former husband may be reduced to $450.00 per month and the wife’s monthly retirement payment may reduce to $900.00 per month.

There are also other reasons the expected monthly payment to both spouses may be reduced from what was expected at the time of the divorce, such as a spouse converting their military retirement to military disability pay.

Federal Law Prohibits a Divorce Judge From Making an Adjustment for a Survivor Benefit Election

Can a Military Spouse Protect Against a Reduction in Military Retirement Benefits From a Survivor Benefit Election

The question then becomes whether a judge in the original divorce decree orders the military spouse to pay their former spouse the difference between the original monthly amount and the reduced about.

In our example, the Husband’s original expected amount from the divorce was to be $500.00 and the reduced amount was $450.00.

Can the military spouse be ordered to pay the non-military spouse the $50.00 difference because the military spouse voluntarily and intentionally decreased the amount both spouses receive from the retirement by choosing a survivor benefit election or converting some or all of their military retirement to military disability pay after the divorce?

The short answer is no.

The Arizona Court of Appeals in a published decision in the case of Barron vs. Barron addressed this issue.

That court held that federal law controls in this situation.

Federal law specifically provides that the amount of military retirement pay that can be treated as community property in a divorce does not include amounts deducted when a survivor benefit election is later chosen after a divorce.

Frequently Asked Questions About Survivor Benefit Elections and Military Retirement in Arizona Divorce

Can a survivor benefit election reduce an ex-spouse’s share of military retirement after an Arizona divorce?

Yes. If the military member elects Survivor Benefit Plan (SBP) coverage after the divorce, the monthly military retirement benefit available to both the service member and the former spouse may be reduced. This occurs because the cost of the survivor benefit is deducted from disposable retired pay before payments are distributed.

What is a Survivor Benefit Plan (SBP)?

The Survivor Benefit Plan (SBP) is a federal military program that allows retired service members to provide continuing income to a designated beneficiary after the retiree’s death. The retiree pays premiums through deductions from military retirement pay, which reduces the monthly retirement benefit received while both parties are living.

Can an Arizona divorce court order reimbursement if a survivor benefit election reduces an ex-spouse’s retirement payments?

Generally, no. Arizona courts are bound by federal law governing military retirement benefits. According to the Arizona Court of Appeals in Barron v. Barron, a court cannot require the military retiree to reimburse a former spouse for reductions caused by a post-divorce Survivor Benefit Plan election because federal law excludes those deducted amounts from divisible military retirement pay.

Why does federal law control military retirement benefits in divorce?

Military retirement benefits are governed by the Uniformed Services Former Spouses’ Protection Act (USFSPA). While the USFSPA allows state courts to divide disposable military retired pay during divorce, it also limits what portions of military retirement may be treated as marital or community property. State courts cannot issue orders that conflict with these federal restrictions.

Can a military spouse intentionally reduce a former spouse’s retirement payments?

A military retiree may make elections after divorce—such as choosing Survivor Benefit Plan coverage—that reduce the amount of disposable retired pay available to both parties. Although these decisions can lower the former spouse’s monthly payments, federal law generally prevents Arizona courts from ordering reimbursement for those reductions.

Does converting military retirement pay to disability benefits affect a former spouse’s share?

Yes. If a retired service member waives a portion of military retirement pay to receive military disability benefits, the amount of disposable retired pay subject to division may decrease. Federal law generally prevents state courts from ordering the retiree to compensate the former spouse for that reduction.

What did Barron v. Barron decide about military retirement in Arizona?

In Barron v. Barron, the Arizona Court of Appeals held that federal law prevents Arizona courts from compensating a former spouse when post-divorce actions reduce military retirement benefits. The decision confirms that courts cannot use equitable principles to override federal statutes governing military retirement.

Can Arizona courts divide military retirement during a divorce?

Yes. Arizona treats the community property portion of military retirement earned during the marriage as divisible property. However, the division must comply with federal law, including the limitations established by the Uniformed Services Former Spouses’ Protection Act.

Can a remarried military retiree choose a new spouse for Survivor Benefit Plan coverage?

Yes. A military retiree may, under federal law and depending on prior obligations, elect Survivor Benefit Plan coverage for a subsequent spouse. Such an election can reduce the monthly disposable retired pay available to both the retiree and any former spouse receiving a share of military retirement.

How is military retirement treated under Arizona community property law?

Arizona generally considers the portion of military retirement earned during the marriage to be community property. The community share may be divided in a divorce, but the calculation is subject to federal law governing military retirement benefits.

Can a divorce decree prevent future reductions in military retirement benefits?

Although divorce decrees can allocate military retirement benefits, they cannot override federal law. If federal law permits certain post-divorce elections or exclusions, an Arizona court may lack authority to prevent resulting reductions in a former spouse’s payments.

What should military spouses consider before finalizing an Arizona divorce?

Military spouses should carefully address military retirement division, Survivor Benefit Plan elections, and other federal benefit issues during divorce negotiations. Because federal law can significantly affect future retirement payments, obtaining legal guidance before entering a settlement or final decree can help avoid unexpected problems later.

Does the Uniformed Services Former Spouses’ Protection Act guarantee a former spouse part of a military pension?

No. The USFSPA authorizes state courts to divide disposable military retired pay under state law, but it does not automatically award a former spouse a percentage of military retirement. The amount, if any, depends on the divorce decree and applicable state community property laws.

Can military retirement payments change after a divorce is finalized?

Yes. Military retirement payments may increase or decrease after divorce because, for among other reasons, disability status or Survivor Benefit Plan premiums recognized under federal law. Those changes can affect the amount a former spouse ultimately receives.

Arizona Divorce Attorneys Dividing Military Retirement Assets

If you have questions about survivor elections and military reduction of retirement in an Arizona divorce case, you should seriously consider contacting the attorneys at Hildebrand Law, PC. Our Arizona community property and family law attorneys have decades of combined experience successfully representing clients in community property and family law cases.

Our family law firm has earned numerous awards such as US News and World Reports Best Arizona Family Law Firm, US News and World Report Best Divorce Attorneys, “Best of the Valley” by Arizona Foothills readers, and “Best Arizona Divorce Law Firms” by North Scottsdale Magazine.

Call us today at (480)305-8300 or reach out to us through our appointment scheduling form to schedule your personalized consultation and turn your Arizona community property or family law case around today.

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