2026 Changes To Divisibility of Military Chapter 61 Medical Retirement In Colorado Military Divorce

Are you involved in a Colorado divorce or family law proceeding involving military retirement? An experienced Colorado Springs divorce attorney can guide you through the legal process and assist you in exploring your options. You have one bite at the apple in the court system so make it count.

There are some 2026 changes that impact the potential divisibility of Chapter 61 military retired disability pay. Traditional military pensions are divisible as property in divorce, though that is not generally true of Chapter 61 military retirements. Generally, Chapter 61 disability pensions can not be divided as property in dissolution. However, there is an exception that may allow a portion to be divided. If a Chapter 61 retiree meets certain criteria, the Defense Finance Accounting Service (DFAS) can calculate the retirement pay using a longevity v. disability formula. The longevity portion of the retirement pay is divisible. DoD FMR, Vol. 7B, ch. 29, ¶ 7.1.3.5; DoD FMR, Vol. 7B, ch. 64, ¶ 5.2.2.

Division of a portion of Chapter 61 retirement pay is available when (1) the retiree qualifies for Concurrent Retirement and Disability Pay (CRDP), (2) the member was retired under Chapter 61 with at least 20 years of qualifying service at retirement, and (3) the Veteran’s Administration has rated the member’s service-connected disability at 50% or more. 10 U.S.C. § 1414(a), (b).

A military retiree who receives disability payments from the Veterans Administration is required to waive military retired pay, dollar for dollar, in return for the disability benefits. However, for members with a VA disability rating of at least 50% and at least 20 years of service, there is effectively no waiver, thanks to Concurrent Retirement and Disability Pay, which restores the retirement lost to a VA waiver. As a restoration of retired pay, CRDP is considered disposable retired pay under 10 U.S.C. § 1408, the USFSPA. The CRDP payment is often less than the full disability retirement, however it does potentially constitute divisible property which would otherwise not be divisible.

DFAS compares two different calculations to see which is more beneficial for the retiree Chapter 61 CRDP retiree:

Disability = Chapter 61 disability retired pay; and

Longevity = the hypothetical longevity retired pay the member would have received based on service had the member not been retired for disability.

In many cases, DFAS cannot use a longevity calculation. DFAS can not use it where the Chapter 61 retiree:

had fewer than 20 qualifying years at disability retirement; or

has a VA rating below 50%

For a qualifying career disability retiree, the amount of Chapter 61 pay that may be paid concurrently with VA compensation is generally the lesser of the disability or longevity calculation.

Here is an example:

• Former spouse awarded a 40% share of the retirement.
• Military member with 20+ years of service receives Chapter 61 retirement of $4000/mo – this is not divisible.
• Member has a VA disability rating of 50% or higher, receiving $1400/mo – this is not divisible.
• Member must waive $1400 retirement to receive the $1400 VA disability.
• Member receives $1400 CRDP to compensate for the VA waiver – this is divisible under this claims appeals board decision.
• Ultimately, the former spouse receives $560/mo (40% x $1400 CRDP), still less than the $1600 (40% x $4000) she would have received if the full retirement were divisible.

It is important to know how to determine whether a retiree is receiving CRDP funds.

CRDP is shown by a note in the comments section of a military Retiree Account Statement indicating how much of the gross retired pay was Concurrent Retirement and Disability pay.

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