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Military Retirees to See Pay Increase
On Feb. 2, an estimated 150,000 military retirees saw an increase in their pay. The National Defense Authorization Act, enacted in November 2003, significantly modified a long-standing law preventing retirees from receiving full-retired pay if they also received disability pay from the Department of Veterans Affairs.
The new law allows concurrent receipt of military retired pay and VA disability pay for retirees with more than 20 years of service and a disability rating of 50 percent or greater. This restored pay will be phased in over a 10-year period that began on Jan. 1, 2004.
Retirees are not required to take any action to receive the additional pay. The Defense Finance and Accounting Service has already identified eligible retirees and begun making adjustments to their military retired pay.
The first payments are due the first business day of February for the law change that was effective Jan. 1. The additional funds will be paid on Feb. 2, 2004 based on entitlement for Jan. 1-31, 2004. The restored pay is paid on the same schedule as current military retired pay. Recurring payments will be made on the first business day of each month based on entitlement for the prior month
For the majority of military retirees, the additional money is taxable income and subject to federal tax withholding.
One category of military retirees that is eligible for additional funds but will not be paid on Feb. 2, 2004, are those who receive retired pay based on a disability percentage instead of years of service. Further guidance is needed from the Department of Defense to determine how the law will be applied in these cases. Once guidance is received, payments will be made retroactive to Jan. 1, 2004. An estimated 2,800 military retirees fall into this category.
For more details regarding who is eligible for the restored pay and how payments will be made, visit www.dfas.mil and see the topics under "Retired and Annuitant Pay," or visit the myPay Web site at https://mypay.dfas.mil. [Source: Defense Finance and Accounting Service]
New Servicemembers' Civil Relief Act Primer
The Head Legal Assistance Branch of the Judge Advocate Division, HQMC has put together a primer to help explain how the new civil relief act applies to servicemembers. Below is a brief description of the SCRA along with several implications. Click here to view the primer in its entirety.
On Dec. 19, 2003, President Bush signed into law the Servicemembers' Civil Relief Act (H.R. 100) ("SCRA"). This law provides many new legal rights to the servicemember, replacing and expanding upon the previous Soldiers' and Sailors' Civil Relief Act ("SSCRA").
This advisory examines the new rights and benefits that the SCRA may provide you under certain circumstances. It also examines issues including (a) who can receive the protections under the SCRA; and (b) when the protections may be claimed.
The SCRA protects members of the Navy, Marine Corps, Army, Coast Guard on active duty (including reserves ordered to duty), PHS and NOAA officers, and National Guard members called to Federal active service in excess of 30 days. U.S. citizens serving in the prosecution of a war or military action with a U.S. ally are likewise protected. Several sections also extend protections to servicemembers' dependents (which generally includes spouse, children, and those you provide more than one-half of their support).
How SCRA protects you
Lease termination: You may terminate your lease by delivering written notice of termination, plus a copy of your military orders, by hand or by return-receipt mail (preferably certified) to the lessor. Prorated rents or lease amounts preceding effective termination must be paid by you. Advance rents or lease amounts prepaid by you must be refunded to you within 30 days of the lease's effective termination. Wrongful withholding from you of rents or security deposits may result in criminal penalties.
Maximum six percent Interest Rate Cap on debts: Creditors must reduce the interest rate on your debts that you incurred before active duty to six percent per year during your period of service. All interest in excess of six percent is forgiven (it may not be postponed or deferred by the creditor. This cap does not apply to new debts you incur while on active duty. The creditor can defeat this provision by showing a court that your ability to pay a rate greater than six percent is not materially affected by your military service. What you should do: seek LAA / other counsel for help providing proper written notice, and a copy of your orders, to the creditor no later than 180 days after your release from service.
Delays / Stays in Legal Proceedings: If your military duty requirements "materially" affect your ability to appear at a judicial or administrative hearing, you are entitled to an automatic ninety (90) day stay, that is, delay, of the proceedings. If you so request of the court, the court must grant one automatic 90 day stay.
Rental housing eviction protection: You and your family cannot be evicted from housing for nonpayment of rent without a court order, no matter what your rental agreement or local laws say. This protection applies to rents $2,465 and below for 2004 and $2,400 in 2003 (up from $1200 in previous years). This $2,465 cap is automatically adjusted by the yearly increase in the November Consumer Price Index (CPI) for All Urban Consumers, Rent of Primary Residence, U.S. City Average. See http://www.bls.gov/cpi/ for the yearly statistic.
If your or your family's ability to pay rent is materially affected by your military service, you may apply to the court and the court must either grant a 90 day stay in eviction proceedings (unless longer or shorter would be more fair to all parties), or adjust obligations under the lease in a way that preserves all parties' interests. The primer covers a great deal more, such as pre-service installment contracts and leases, mortgage and storage lien protection, health insurance, small business owner protection, taxes, powers of attorney, voting rights and more.
Marines or their family members with questions regarding the SCRA should visit their local Legal Assistance Office. Most, if not all, of the terms in the SCRA have very specific meanings and limitations that are not fully explored in the primer. To fit your situation within the SCRA, you should seek legal advice. Legal Assistance Attorneys are trained in consumer, family, and tax law matters and can assist in interpreting the provisions and application of this law. [Source: USMC Staff Judge Advocate Legal Assistance]
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