Changes to Division of Military Retired Pay After Divorce

It’s usually a foregone conclusion that the marriage is over by the time couples with one or both of them serving in the armed forces decide to hire Virginia military divorce attorneys. Child custody, visitation, support, and distribution of pensions and other assets usually remain the only issues left to resolve, which is not that different from civilian divorces. However, military pension division presents challenges for a military divorce lawyer in Newport News that lawyers for civilian couples would not face. The reason has to do with federal law restricting how states allow their judges to calculate military pension division.

Equitable Distribution and Military Pensions

Virginia law treats marriage as an economic partnership and provides for the equitable distribution of assets. Those assets acquired by the parties during the marriage are marital property to be distributed between the spouses as part of a divorce. Property acquired as a gift or inheritance by only one spouse during the marriage or assets that a spouse brings into the marriage may be separate property and not subject to equitable distribution.

The value of marital assets must be determined as of a specific date, which usually is the date of trial of the divorce or another date agreed to by the parties with approval of the court. An appraisal may be all it takes to arrive at the value of homes, cars, art collections and other assets. It becomes more complex when marital assets include pension or retirement plans.

A pension or retirement account may be a combination of marital property and separate property. The portion of a pension’s value earned during the marriage would be marital property. If the pension predates the marriage, that portion of its value earned prior to the marriage would be separate property. When all or a portion of the value of a pension in the name of one spouse is a marital asset, Hampton courts may not award more than 50% of its value to the other spouse.

Virginia courts have applied the same method when deciding how to distribute the pension of a spouse serving in the military as it applied to non-military pensions. Congress changed that when it passed the 2017 National Defense Authorization Act.

New Military Retired Pay Rules Apply in Virginia Divorces

Prior to 2016, the Uniformed Services Former Spouse Protection Act granted states the right enact their own laws regarding equitable distribution and military retired pay. Virginia chose to use a method that valued military retiree pay for purposes of equitable distribution as a percentage what it would be at the rank achieved by the service member as of the date of retirement. It was similar to the rule applied to divorces involving equitable distribution of pensions not unrelated to the military.

The NDAA for 2017 created a method states must now use to divide military retired pay as part of the distribution of marital property in a divorce. The new rule only applies to divorces in which one of the spouses has not yet retired from the military. It requires that states apply a frozen benefit rule that uses the date of the divorce decree to lock in the rank and years of service of the military spouse.

The frozen benefit rule has no application in Virginia divorces involving spouses who have ended their military careers. Courts may use the actual retired pay for purposes of equitable distribution

Hampton Roads, Virginia courts must divide the military retire pay as though the spouse was retired on the date of the divorce decree. They no longer may take into account the actual retired pay the service member would receive at retirement. The new rule fails to take into account the contributions a spouse makes to a marriage enabling a member of the military to serve, earn promotions and increase the value of the pay received at retirement. A Virginia alimony lawyer may offer options to overcome an unfair distribution of marital assets based upon application of the new rules regarding military retired pay.

Speak With an Experienced Military Divorce Lawyer

The Virginia military divorce attorneys at the Denbigh Law Center combine their knowledge of state and federal laws with years of experience advising and representing service members in Yorktown and other Hampton Roads communities. People in need of a Virginia alimony lawyer or a military divorce lawyer can schedule an appointment by calling 757-877-2244.