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Normally, the death of a military retiree terminates all pension payments. The Survivor Benefit Plan (SBP) is an annuity that allows retired military members from both active duty and the reserves to provide continued income to specified beneficiaries when the retiree dies. 10 U.S.C. ' 1447-55. See also 10 U.S.C. ' 1448. The SBP is funded by premium payments from the retiree's paycheck and reduces the amount of the Disposable Retired Pay. With it, the designated survivor receives a lifetime annuity of up to 55% of the retired member's pay. In addition to spouses and former spouses, coverage is also available for a child, so long as the child is from the marriage of the service member and the former spouse. See 10 USC ' 1448.
For married persons on active duty, the election for the SBP must be made before or at retirement. 10 U.S.C. ' 1448(a)(2)(A). A spouse loses eligibility as an SBP beneficiary upon divorce. The only way by which a divorced spouse may receive a survivorship annuity is if the former spouse's coverage is elected. A court order cannot, by itself, be used to create coverage; a signed election request must be submitted by the service member or, in some cases, the former spouse, before
coverage can be established. Reservists can make the election upon completion of 20 years of creditable service, and can also elect SBP coverage upon reaching age 60. 10 U.S.C. ' 1448(a)(2)(B).
When divorce occurs after retirement, military retirees may elect former spouse coverage for a spouse who was a beneficiary under the SBP. Retirees participating in the SBP may elect former spouse coverage within 1 year after the divorce becomes final. A retiree who elects to provide an annuity to a former spouse must, at the time of making this election, provide a statement that the election is being made pursuant to a court order or pursuant to a written agreement previously entered into voluntarily by the retiree as part of, or incident to, a divorce proceeding; and if this is the case, whether such written agreement has been incorporated in, ratified, or approved by a court order. An election filed by the retiree is effective upon receipt by the Defense Finance and Accounting Service. Moreover, the election must be filed after the divorce becomes final. See 10 U.S.C. ' 1448.
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