WASHINGTON — Republican defense lawmakers want the government to stop shortchanging military widows and widowers of their benefits, but they'll need help from budget planners to do it.
Earlier this week, members of the House Armed Services Committee released their annual "views and estimates" letter petitioning congressional appropriators for a host of military spending priorities.
Included in the list for the first time in six years was finding a solution to the ongoing problem of Defense Department's Survivor Benefit Plan payouts — also known as "the widow's tax" — which issue letter signers called small in terms of federal spending totals but significant in the impact it has on military families.
Veterans groups have pushed for a solution to the problem for almost three decades, calling it an unfair practice that strips thousands of dollars in benefits payouts from veterans' survivors without good justification.
Families of military retirees who enroll in the SBP can receive up to 55 percent of their loved ones' retirement pay after the veteran dies. The life insurance-type payouts are subsidized by DoD, but require enrollees to pay-in part of their retirement benefit to be eligible.
In addition to that program, the Department of Veterans Affairs offers a Dependency and Indemnity Compensation program that awards around $15,000 a year to survivors of veterans or troops who die of service-related causes.
Individuals who qualify for either SBP money or DIC benefits receive full payouts from the respective programs. But family members who qualify for both are subject to an offset, where for every dollar paid out in DIC their payouts under SBP are reduced by one dollar.
The result is a loss thousands of dollars a year in benefits. In testimony before Congress Thursday, Gold Star Wives spokeswoman Misty Brammer said it creates significant financial problems for families who are already dealing with the death of a loved one.
"The security they spent saving for is not there," she said. "This is unfair."
The issue affects about 63,000 families nationwide. Fixing it would cost about $1 billion a year, a small fraction of the country’s $600 billion-plus in annual defense spending.
But finding that money has proven near impossible for defense lawmakers, given increased military funding demands and issues of budgetary jurisdiction in Congress.
Instead, in recent years lawmakers have approved gap payments — known as Special Survivor Indemnity Allowance — to get around the offset regulations without fully funding a repeal.
Those stipends are typically less than $300 a month. Committee estimates put the average lost payouts due to the SBP/DIC offset problem around $1,250 a month. And the SSIA payouts are set to expire in May 2018 unless more money is set aside.
"Increased funding to support the ‘widow’s tax’ would correct the disconnect in survivor spouse compensation that we simply cannot correct without your assistance," committee Republicans wrote in the letter to appropriators.
The House Appropriations Committee is expected to unveil their defense funding plans for fiscal 2018 in late spring.
Leo Shane III covers Congress, Veterans Affairs and the White House for Military Times. He can be reached at lshane@militarytimes.com.
Leo covers Congress, Veterans Affairs and the White House for Military Times. He has covered Washington, D.C. since 2004, focusing on military personnel and veterans policies. His work has earned numerous honors, including a 2009 Polk award, a 2010 National Headliner Award, the IAVA Leadership in Journalism award and the VFW News Media award.
