Beyond the 10/10 Rule: How Military Pensions, Disability, and SBP Really Get Divided in Divorce

Military divorce is not just “regular divorce with uniforms” - it sits at the intersection of federal statute, state family law, and a maze of acronyms like DFAS, USFSPA, SBP, and VA. Misunderstandings about the 10/10 rule alone can cause spouses to walk away from money they could have received or to negotiate based on false assumptions about eligibility for retirement pay. Add in the marital share formula, disability offsets, strict one‑year SBP deadlines, and jurisdiction rules that can quietly void a court’s authority, and the stakes become painfully clear for service members, former spouses, and the public administrators who support them. This article unpacks those moving parts in plain language so readers can spot the pitfalls before they sign a decree, advise constituents more effectively, and negotiate from a position of informed confidence rather than guesswork.

Understanding the 10/10 Rule and Its Limitations

A common point of confusion in military divorces is the so-called "10/10 rule." This rule refers to a provision under the Uniformed Services Former Spouses’ Protection Act (USFSPA), which allows the Defense Finance and Accounting Service (DFAS) to send retirement payments directly to a former spouse if the couple was married for at least 10 years, and the service member performed at least 10 years of creditable military service during the marriage. It is essential to note that this rule does not determine whether a former spouse is entitled to a portion of retirement pay - it only governs whether the payments can be made directly from DFAS rather than through the retiree¹.

The 10/10 rule often causes confusion because some mistakenly believe that failing to meet the 10/10 threshold means a spouse cannot receive any portion of military retirement. In fact, state courts can still award a share of military retirement to a former spouse regardless of the length of the marriage or service overlap. If the marriage does not meet the 10/10 requirement, the payments simply must be made by the retiree to the former spouse directly. This nuance is critical in divorce negotiations and should be clearly understood by legal counsel and the parties involved to ensure compliance with both federal law and state court orders².

Calculating the Marital Share of Military Retirement

Retirement pay division is typically calculated based on the "marital share" formula, which considers the portion of the service member's career that overlapped with the marriage. This is often expressed as a fraction: the number of months of marriage during creditable military service divided by the total number of months of creditable service. The resulting percentage is then applied to the member’s disposable retired pay to determine the former spouse’s share. Courts may award up to 50 percent of the disposable retired pay as marital property under the USFSPA³.

It is important to distinguish "disposable retired pay" from gross retired pay. Disposable retired pay excludes deductions such as VA disability offset, Survivor Benefit Plan (SBP) premiums, and certain court-ordered payments like child support. Since VA disability compensation can reduce the amount of retired pay subject to division, this may significantly impact what a former spouse ultimately receives. Practitioners should advise clients to examine how disability claims may affect retirement distribution and contemplate alternative arrangements if VA offsets are anticipated⁴.

Survivor Benefit Plan (SBP) Considerations

The Survivor Benefit Plan (SBP) offers ongoing income to a beneficiary after the service member’s death. For many former spouses, this is a critical element of financial stability post-divorce. A common mistake is assuming that an award of retired pay automatically includes SBP coverage. In reality, SBP must be specifically addressed in the divorce decree and properly submitted to DFAS within one year of the divorce. Otherwise, the former spouse may lose eligibility for this benefit entirely⁵.

Service members and former spouses should work with legal counsel to ensure that SBP elections are clearly stated in the divorce decree, including whether the former spouse is designated as the "former spouse beneficiary" and whether coverage is full or reduced. DFAS requires a completed DD Form 2656-10 and a copy of the applicable court order. It is not uncommon for SBP election paperwork to be mishandled or omitted, leading to disputes or loss of benefits. Proper planning and timely submission are essential to protect the financial interests of both parties⁶.

State Court Jurisdiction and Federal Limits

While the USFSPA allows state courts to treat military retired pay as marital property, it also places certain restrictions on jurisdiction. A state court may only divide military retirement if it has personal jurisdiction over the service member. This usually requires that the service member resides in the state for reasons other than military assignment, consents to the court’s jurisdiction, or is otherwise properly served under applicable state laws⁷.

This limitation is particularly relevant for service members stationed temporarily in a state. If proper jurisdiction is not established, the division of military retirement could be invalidated. Legal practitioners should verify that the court has valid jurisdiction before proceeding with any division of retirement pay. This is especially important in contested divorces or when the parties reside in different states. Failure to ensure jurisdictional compliance can result in delays, appeals, and additional legal expenses⁸.

Preparing Financially for Divorce as a Service Member

Service members facing divorce should begin by gathering a complete record of their military earnings, service history, and retirement projections. This includes pay statements, LES records, and retirement point summaries (for Reservists or National Guard). It is also advisable to consult with a certified financial planner who has experience with military clients. These professionals can help project how asset division, SBP premiums, and potential VA offsets will affect long-term retirement income⁹.

Anticipating post-divorce financial obligations is another critical planning step. Alimony, child support, and garnishments can significantly reduce take-home pay. Service members should prepare a post-divorce budget that realistically accounts for all these obligations. In some cases, it may be prudent to explore legal options for modifying existing support orders if financial hardship can be demonstrated. Proactive financial planning can prevent long-term disruptions and ensure stability during transition¹⁰.

Practical Advice for Public Administrators Supporting Military Constituents

Public administrators who serve populations with a high concentration of military personnel or veterans should familiarize themselves with the intricacies of military divorce. Many service members and their spouses rely on local government services during the divorce process, including housing assistance, legal aid referrals, and financial counseling. Understanding the specific challenges military families face can help administrators craft responsive programs and policies that meet their needs more effectively.

For instance, public-sector agencies can benefit from forming partnerships with accredited military legal assistance offices or nonprofit organizations that specialize in veteran and military family support. These collaborations can streamline access to reliable information and reduce the risk of misinformation, particularly regarding retirement division and survivor benefits. Offering tailored workshops or informational sessions on military divorce can enhance service delivery and build trust among military-connected residents.

Bibliography

1. Defense Finance and Accounting Service. "Former Spouses' Protection Act." Accessed April 20, 2024. https://www.dfas.mil/garnishment/usfspa.

2. U.S. Department of Defense. "Military Compensation: Divorce and the 10/10 Rule." Accessed April 20, 2024. https://militarypay.defense.gov/Benefits/Divorce/.

3. American Bar Association. "Military Divorce Guide." Accessed April 20, 2024. https://www.americanbar.org/groups/family_law/resources/military_divorce/.

4. U.S. Government Accountability Office. "Military Retirement: Limitations on Benefits Distributed to Former Spouses." GAO-20-452. June 2020. https://www.gao.gov/assets/gao-20-452.pdf.

5. Defense Finance and Accounting Service. "Survivor Benefit Plan (SBP) for Former Spouses." Accessed April 20, 2024. https://www.dfas.mil/retiredmilitary/provide/sbp/formerspouse.html.

6. U.S. Army Judge Advocate General’s Corps. "Legal Assistance: Survivor Benefit Plan for Former Spouses." Accessed April 20, 2024. https://www.jagcnet.army.mil/SBP/FormerSpouse.

7. Uniformed Services Former Spouses’ Protection Act, 10 U.S.C. § 1408.

8. National Military Family Association. "Understanding Military Divorce." Accessed April 20, 2024. https://www.militaryfamily.org/resources/military-divorce/.

9. Financial Industry Regulatory Authority. "Military Financial Planning." Accessed April 20, 2024. https://www.finra.org/investors/military.

10. U.S. Department of Veterans Affairs. "Garnishment of Benefits." Accessed April 20, 2024. https://www.va.gov/resources/garnishment-of-benefits/.