Severance Pay and PDBR information

commosgt

commosgt

PEB Forum Regular Member
PEB Forum Veteran
I was curious about all that I am hearing about severance pay and PDBR and getting your money back. So i called the toll free number for the VA and had the person to submit a request via IRIS on friday. I got a call just now from my regional office in Houston. The lady was very helpful and told me exactly what to request as far as your statement. This is the first step in getting information about severance pay (check attachment). The second thing you should do is once you receive the letter from the finance office answering your request. You should take all of your information from the PDBR once you retired and the letter about your severance and as she stated go to the regional office and submit the information right there on the spot. AND IF POSSIBLE REQUEST TO TALK WITH SOMEONE AT THE FINANCE DEPARTMENT. The reason is that the VA has NO IDEA about this. She was supervisor but has heard some information about it. I talked at length about my possiblities of retiring. She stated she was going to take this up with higher and call me once everything is done. But the main idea is the VA has no idea about this and she stated that if and when I am retired that I will and should get my severance pay back due to the fact of the Army not retiring from the get go. I hope this helps and if you guys/gals have any questions please let me know. I wish i could give more but atleast i was able to get further along in communication with the VA.
 

Attachments

OH, please remember to take your DD-214 and DD-215 (corrected), your retirment orders, and anything else you might need as well. Sorry, I forgot to take my anxiety meds was in a rush to post this!!! Feeling better now!
 
Seems like there are different conclusions from different regional offices.

I was retired by the PDBR and was told that i am not getting my severance back from the VA because i am not receiving retirement pay because my VA compensation offsets it.

My regional office in Roanoke, VA is very adamant that i not getting anything back. I am awaiting a decision review officer to look mine over but i am not holding my breath.

I went through the IRIS system too and they had no idea how to deal with it. They sent my request over to the Roanoke, VA Regional Office and was told no severance pay will be given back. I am still having mine taken out and they have been taking it out since 2003, they told me it won't be completely recouped until 2016. Kind of ticks me off, but there doesn't seem like much i can do at this point. Good luck!
 
Yes that is correct. The VA has no idea how to handle this issue across the board. I would start with what i purpose first and go from there. Again The PDBR, VA, and DFAS has no system in place to deal with this but it is a start. The more that are going through this the better. They will have to address this!! But don't give up as well as stress yourself. The best thing is keep working at it starting with the 4138 and go from there.
 
Attached are the letters. I sent one to the VA when i was retired via the PDBR and their response to requesting my severance pay back.
 

Attachments

seminole72 said:
Attached are the letters. I sent one to the VA when i was retired via the PDBR and their response to requesting my severance pay back.
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I am so confused by this. I think that once a person is "retired" that they should not have to pay back the severance pay, and that they should have every dime returned to them. The issue that I do not understand is how the legal part of this is written.

I understand that the only way to receive back the money is if the National Defense Authorization Act of 2008 applies to the person? That they would only get back the money if it is "combat related" and they were discharged in 2008 or after (since it is not grandfathered)?

Does anyone understand this?
I do not understand why the “now retired person” should be penalized for the militarys mistake.
 
I think I am beginning to understand this a little better. VA does not return the severance or stop recouping the severance because they view disability severance funds as a lump sum cash advance of VA disability compensation. Because Chapter 61 retirees can elect to receive VA pay in lieu of retirement pay (the offset), those vets with high disability ratings from VA most likely do not draw any retirement check from DFAS since their VA pay likely exceeds their retirement pay. Vets with 100% VA ratings draw in the neighborhood of $3000 per month from VA. There are surely exceptions, but my guess is not many Chapter 61 retirees with 100% VA ratings have retirement checks larger than that and hence do not draw a retirement check from DFAS. In my particular case, my retirement pay (11 yr E-7 ~$987) would exceed my VA pay (40% spouse & child ~$644). My understanding of the system is that if I were retired, VA would continue to recoup the "advanced" severance and I should be due from DFAS $987-$644= $343 TAXABLE for each month since my date of discharge/retirement. (For clarification: I used 2010 rates for this example. Those numbers would vary in prior years based on COLAs). If not mistaken, I believe I have also read DFAS hits you for insurance premiums in any retro payments.

I still haven't submitted my package to PDBR, so unfortunately I can't say I can test this theory anytime soon. If anyone else has information, please share.
 
CommoSgt,
I'm in the same boat. Was dx back in july2004 and given severance. Now i was retired by the pdbr and got my blue id. My question is Are you getting any backpay? I paid off my severance about over a year now and wondering if i should be paid retro.
from date of retirement to present minus severance? Please keep me updated on your status on this case. Thanks, JTOL76
 
Jtol,

See my previous post. I think the answer depends on your VA rating and your military retirement percentage (based on grade/rank at retirement, time in service, and disability percentage). If you have a high VA rating, your VA compensation likely exceeds your military retirement. Just take your monthly base bay from when you were discharged in 2004 and multiply that by your disability retirement percentage to get your military retirement pay. If your military retirement pay is less than your VA compensation, then you likely will not get any retro.
 
brnt said:
Jtol,

See my previous post. I think the answer depends on your VA rating and your military retirement percentage (based on grade/rank at retirement, time in service, and disability percentage). If you have a high VA rating, your VA compensation likely exceeds your military retirement. Just take your monthly base bay from when you were discharged in 2004 and multiply that by your disability retirement percentage to get your military retirement pay. If your military retirement pay is less than your VA compensation, then you likely will not get any retro.
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That is what i was thinking and the VA is telling me the exact same thing. I guess the VA and the service are right then? It's hard to except that the vet is still having to pay for their initial screw up. If i knew i had a leg to stand on and would win i would file a lawsuit against them. I am blessed to be able to afford it and hopefully it would help other veterans but i am reluctant since i don't know if i'd be right or not.
 
Seminole,

Based on my limited understanding, I think you are right to be hesitant. Based on your posts, you got 30% disability retirement from the service and were an E-6 with over 10 years at time of discharge in 2004. In 2004 the monthly base pay was $2596.20. Had you been retired rather than severanced you would have collected 30% of that or $778.86 (subject to same COLA as VA). At an 80% VA rating (min. compensation depending on family situation in 2004 was $1227), your VA compensation has always exceeded (and replaced due to offset) your military retirement compensation, so no retro pay is due.

As far as the severance goes, I have always been told the severance is treated by VA as a lump sum cash advance of VA compensation. So I think they are right to not stop recouping the pay or to return severance that has been recouped. I suppose the best way to think of it is you got a nice lump sum cash advance loan that you have been repaying/repaid through reduced VA compensation at 0% interest. Everyone's situation is different, but some might argue that is the best of both worlds. What I mean by that is even though the military made a mistake in not retiring you initially, maybe it wasn't such a bad deal. You did get the benefit of the lump sum which could have been of greater benefit to you and your family at the time than the monthly check.

As always, anyone with better information please jump in.

--brnt
 
brnt said:
Seminole,

Based on my limited understanding, I think you are right to be hesitant. Based on your posts, you got 30% disability retirement from the service and were an E-6 with over 10 years at time of discharge in 2004. In 2004 the monthly base pay was $2596.20. Had you been retired rather than severanced you would have collected 30% of that or $778.86 (subject to same COLA as VA). At an 80% VA rating (min. compensation depending on family situation in 2004 was $1227), your VA compensation has always exceeded (and replaced due to offset) your military retirement compensation, so no retro pay is due.

As far as the severance goes, I have always been told the severance is treated by VA as a lump sum cash advance of VA compensation. So I think they are right to not stop recouping the pay or to return severance that has been recouped. I suppose the best way to think of it is you got a nice lump sum cash advance loan that you have been repaying/repaid through reduced VA compensation at 0% interest. Everyone's situation is different, but some might argue that is the best of both worlds. What I mean by that is even though the military made a mistake in not retiring you initially, maybe it wasn't such a bad deal. You did get the benefit of the lump sum which could have been of greater benefit to you and your family at the time than the monthly check.

As always, anyone with better information please jump in.

--brnt
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brnt,

That sounds right to me but i hope i am wrong. lol
 
If you have seen any of my posts, I have been thru the entire process including CRSC. The paperwork I got from DFAS said I was due $24K in back CRSC. They paid me $16k saying I was due $8k from VA. Since VA, DFAS, Army and DOD worked together on this process, I tend to believe that I will get that $8K back from VA. Now they are slower than DFAS, and I got my CRSC money from DFAS in late October. So I am expecting that payment. We will see how it goes. Best of luck to everyone else fighting.

Hammer
 
guntruckhammer said:
If you have seen any of my posts, I have been thru the entire process including CRSC. The paperwork I got from DFAS said I was due $24K in back CRSC. They paid me $16k saying I was due $8k from VA. Since VA, DFAS, Army and DOD worked together on this process, I tend to believe that I will get that $8K back from VA. Now they are slower than DFAS, and I got my CRSC money from DFAS in late October. So I am expecting that payment. We will see how it goes. Best of luck to everyone else fighting.

Hammer
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This is interesting to me. My husband has been through all of this now too, and was awarded CRSC. He was only paid through DFAS. Why are you getting money from the VA? It was my understanding that DFAS would be the one who paid the CRSC??? And then after the lump sum (back pay) DFAS would be direct depositing each month, and this does not affect his VA comp.
 
guntruckhammer said:
This would be a payback of the severance the VA recouped.
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Huh? Interesting. Thanks for the information. The VA recouped the full amount of the severance from my husband yet they did not pay it back to him after CRSC kicked in. Thanks again for the information. It is going to be interesting how they compute all this.
 
In my case, the VA stopped recouping the severance as the debt(of sorts) was handed over to the Air Force along with the amount already recovered. I've done some reading, found the reg and it essentially says that any pay that should have been received (retro) would be applied to the debt as well as any pay going forward. Because I won't see any of that mony anyhow, I got a bump in VA pay by them NOT taking out the recoupment, and tax-free as always. From my perspective, the debt is gone, paid by money I won't see anyway....
 
Hello,

I've been through the same situation myself. In my case, when I received CRSC back pay, it also included a refund of the monies recouped by the VA for what was formerly the severance. However, the VA now wants to recoup the entire amount again because they say that because my severance was re-characterized as retirement pay, that it constitutes concurrent receipt (which as we all know is not authorized for medical retirees except partially through CRSC relief). So, I am appealing the VA's decision because the numbers just don't seem to workout right but I am sure that eventually I will be required to pay recoupment to someone. As far as the recoupment being strictly by DFAS and it basically being just a number shuffle on money you will never see, I'm not sure if that is correct or not at this point, it's very confusing.

Kevin
 
Are you combat related? Did the VA recoup your severance? Something seems off with your case.

v/r,
Frank
 
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