Items of Note from the FY05 Defense Authorization Act

Social Security Offset for SBP Annuities to be Phased Out

Congress has approved legislation that - over a three and half year period - will eliminate the Social Security Offset reduction applied to the Survivor Benefit Plan (SBP) annuity. This will eliminate the annuity reduction from 55 percent to 35 percent when the annuitant reaches age 62. The reduction will be phased in through April 2008.

In October 2005, those affected annuitants whose annuity had been reduced to 35 percent will see their annuity increased to the 40 percent level.

In April 2006, the annuities will be increased to 45 percent.

In April 2007 they will increase to 50 percent.

In April 2008 they will be fully restored to the 55 percent level.

These changes require no action on the part of annuitants.

ONE-YEAR OPEN ENROLLMENT PERIOD FOR SURVIVOR BENEFIT PLAN COMMENCING OCTOBER 1, 2005

Persons not currently participating in the Survivor Benefit Plan, (eligible retired or former member) may elect to participate in the Survivor Benefit Plan during the open enrollment period commencing 01, October 2005.

This would entail paying all back monthly premiums from the date of your retirement to buy into the SBP program. This could be a substantial sum for those of you who have been retired for many years.

100% Disability Compensation & Military Retirement Pay Phase In Repealed

For 100% Disabled Veterans, the phase in of concurrent receipt of Retired Pay and Veterans Disability Compensation has been repealed. The 100% disabled veteran will begin drawing full retirement pay along with the 100% disability compensation. This was effective on 31 December 2004.

Permanent ID Cards for Spouses & Survivors Age 75 and Older

The new public law also provides for permanent military ID cards for spouses and survivors age 75 and older. They will no longer have to renew their ID Cards every 4 years.