Calculating Military Retirement Pay in Texas Divorces

Divorce proceedings involving military personnel in Texas present unique challenges due to the specific federal laws and Texas statutes that govern the division of military retirement pay and other military benefits. This detailed exploration examines how waivers and federal formulas influence the calculation of military retirement pay in such divorces, alongside a comprehensive review of the associated legal and financial nuances.

Understanding Military Retirement Pay and Disability Benefits

Military retirement pay is a pension paid to servicemembers after a minimum required period, typically at least 20 years. The Uniformed Services Former Spouses’ Protection Act (USFSPA) allows this pay to be treated as marital property and divided between the servicemember and their spouse in a divorce. Specifically, the USFSPA permits state courts to treat a military retiree’s “disposable retired pay payable to a member for pay periods beginning after June 25, 1981” as community property that can be divided in a divorce (10 U.S.C. § 1408(c)(1); Mansell v. Mansell, 490 U.S. 584–85).

The Role of Waivers in Retirement Pay

Military retirees may opt to waive a portion of their retired pay to receive disability benefits, which are exempt from federal income tax. This decision is strategically beneficial as highlighted in Mansell v. Mansell: “to prevent double dipping, a military retiree may receive disability benefits only to the extent that he waives a corresponding amount of his military retirement pay” (Mansell v. Mansell, 490 U.S. 581, 583 (1989)). The tax-exempt status of disability benefits often makes them more financially advantageous than taxable retired pay.

Calculating Retirement Pay: Federal Formulas

The calculation of military retirement pay is dictated by federal formulas based on factors such as years of service, rank, and salary at the time of retirement. This involves a lot of ‘jumping around’ Title 10 of the United States Code, highlighting the complex nature of these calculations (10 U.S.C. § 1408(a)(4)(B)).

The USFSPA defines disposable retired pay as “the total monthly retired pay to which a member is entitled less amounts deducted… as a result of a waiver of retired pay required by law in order to receive disability benefits” (10 U.S.C. § 1408(a)(4)(A)(ii)). These calculations are critical when determining what is available for division in divorce proceedings.

Detailed Explanation of Federal Formulas for Calculating Retirement Pay

The calculation of military retirement pay uses federal formulas that are essential to understand in the context of divorce. Specifically, these formulas often involve the “high-three average,” which calculates retirement benefits based on the average of the highest three years of salary for the servicemember. This method ensures the retirement pay reflects the peak earning years close to retirement, which can significantly impact the final retirement benefits:

“10 U.S.C. § 1407 (establishing various retirement pay formulas based on servicemember’s ‘high-three average’); 10 U.S.C. § 12739(a) (computing retirement pay based on product of base pay under sections 1406 or 1407 and ‘2 ½ percent of the years of service credited to that person under [10 U.S.C. § 12733]’).”

This formula is particularly crucial because it affects how much of the retirement pay is considered “disposable” and thereby eligible for division in a divorce. The “high-three average” method ties directly into discussions on the fairness and equity of dividing military pensions, as it potentially maximizes the retirement pay subject to division, reflecting the servicemember’s career peak rather than an arbitrary selection of years.

Differences Between Military Retired Pay and Other Retirement Benefits

Military members may receive various benefits that differ significantly from retired pay in terms of divisibility and tax implications:

  • Disability Benefits: Not taxable and not divisible in a divorce.
  • Health Care Benefits (TRICARE): Continue for retired servicemembers and their dependents but are not considered a divisible asset.
  • Survivor Benefit Plan (SBP): Allows servicemembers to provide for beneficiaries after death but is not treated as divisible marital property in divorce proceedings.

Texas Law and Its Impact on Military Divorces

In Texas, the division of military retirement pay must align with federal guidelines, yet the state’s community property laws also play a critical role. Texas respects the federal stipulation that disability payments and certain other benefits are exempt from division.

TRICARE and SBP Considerations in Texas Divorces

The handling of TRICARE and SBP benefits in Texas divorces does not involve division but does impact financial negotiations. For example, eligibility for continued health benefits and the allocation of SBP can significantly affect the financial stability of the non-military spouse.

Key Legal Precedents Influencing Military Divorces

Supreme Court rulings such as Mansell v. Mansell and Howell v. Howell have set important precedents. In Howell, the Court determined that state courts cannot divide military retired pay that has been waived in favor of receiving disability benefits (Howell v. Howell, 581 U.S. 214, 220-21). These cases emphasize the need for precise legal strategies in military divorces.

Hypothetical Case Studies

Case Study 1: Waiver of Retirement Pay

A retired servicemember during a divorce in Texas has elected to receive disability benefits in lieu of a portion of his retirement pay. The court must consider the non-divisible nature of the disability benefits while dividing the remaining retired pay.

Case Study 2: Division of SBP Benefits

In another scenario, a divorcing couple is negotiating the division of SBP benefits. While the benefits themselves are not divisible, the agreement about who benefits from the SBP can be crucial in ensuring financial security for the non-military spouse.

The Future of Military Divorce Law

As military policies and federal laws evolve, the legal landscape regarding military divorces in Texas may also change. Staying informed about these developments is crucial for legal professionals and their clients to effectively handle future cases.


The division of military retirement pay in Texas divorces, influenced by waivers and federal calculation formulas, requires careful consideration of both federal guidelines and state laws. Understanding the nuances of military benefits, such as the tax-exempt status of disability payments and the intricacies of the “high-three average” salary calculations, is crucial for legal professionals handling these cases. As laws and military policies continue to evolve, staying updated on these changes will ensure that legal strategies remain effective and equitable, providing clarity and support for military personnel and their families through the complexities of divorce.

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