| UPDATE from DFAS on SBP-DIC changes:
Congress included a phased elimination
of the SBP-DIC offset in the 2020 National Defense Authorization Act. The
first adjustment to the offset formula will be for January 2021 (paid on
February 1, 2021). The offset will be eliminated entirely beginning on
January 1, 2023.
We created a special webpage to share news
about the implementation of this new law. Please plan to check this webpage
for updates:
https://www.dfas.mil/sbpdicnews
This webpage has a collection of Frequently
Asked Questions and answers. The FAQs are also available in a downloadable,
shareable PDF on this webpage.
Who this change affects
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This change affects surviving spouses who
are, or who will become in the future, eligible for both Survivor Benefit
Plan (SBP) payments and Dependency and Indemnity Compensation (DIC) payments,
and who are subject to the SBP-DIC offset.
-
The law also affects the spouses and children
of service members who died while on active duty or inactive duty, in the
line of duty, if the children are currently receiving SBP payments because
the surviving spouse chose the optional child annuity.
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This change does not affect surviving spouses
who receive only SBP (but do not receive DIC). It also does not affect
spouses who receive DIC only, either because SBP was declined by the service
member at retirement or because the service member was a disabled veteran
who was not also a retiree.
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It is important to note that this change does
not impact any retirees or surviving spouses if SBP spouse coverage was
previously declined or if a retiree elected child-only coverage at retirement.
The change also does not create opportunities for new enrollment in SBP
for retirees who previously declined coverage.
What you need to know
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Surviving spouses who are subject to the SBP-DIC
offset will potentially see the first change in their January 2021 SBP
payment that is paid on February 1, 2021.
-
We are unable to provide individual estimates
of the upcoming changes in spouse SBP annuity payments due to this change
in the law. Please do not call our Customer Care Center to request an individual
estimate.
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If you previously received a refund of SBP
premiums paid due to the SBP-DIC offset, you won’t need to pay back that
refund because of this change in the law.
-
Eligible survivors will continue to receive
SSIA, up to the prescribed maximum amount ($323 per month for 2020) or
the amount of SBP that is offset due to DIC, whichever is less. SSIA will
no longer be paid once the SBP-DIC offset is fully eliminated in 2023.
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Please keep in mind that there are many different
situations for individuals, and you may have individual questions we cannot
answer yet. We are continuing to develop full implementation guidance for
this change.
What you need to do
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You do not need to notify us that your SBP
payment is affected by this change in the law.
-
The most important action SBP annuitants can
take at this time is to ensure your annuity account information is up-to-date
and includes your correct mailing address so we can contact you, if needed.
Also, if you’re not using myPay, set up a profile now and add your email
address. Please note: only annuitants who are currently receiving an SBP
or SSIA payment from DFAS can access myPay.
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If you are a surviving spouse who previously
chose the Survivor Benefit Plan (SBP) child annuity when your spouse died
on active duty or inactive duty, you do not need to take any action at
this time. You will be contacted by the appropriate military service prior
to the annuity reverting to you as the surviving spouse on January 1, 2023.
When you can expect changes
Based on the NDAA, the phases of the SBP-DIC
offset elimination are:
-
In 2020, surviving spouses will continue to
have their SBP offset by the full amount of Dependency and Indemnity Compensation
(DIC) they receive from the Department of Veterans Affairs.
-
In 2021, SBP will be reduced by no more than
two-thirds of the amount of DIC rather than by the entire amount of DIC,
even though eligible surviving spouses will continue to receive the full
amount of DIC.
Please note that not all surviving
spouses will see an increase in their SBP payment in 2021. It is possible
that if a spouse’s SBP monthly payments are less than two-thirds of the
amount of monthly Dependency Indemnity Compensation (DIC), they may not
see an increase in 2021.
-
In 2022, SBP will be reduced by no more than
one-third of the amount of DIC received.
-
In 2023, the SBP-DIC offset will be totally
eliminated, so that surviving spouses eligible for both programs will receive
both SBP and DIC in full, effective January 1 (paid on February 1, 2023).
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