A number of my classmates and I have diseases related to exposure to Agent Orange* in Viet Nam. I urge those who were wounded and those have those diseases to pay special attention, because most of them are missing out on a great benefit.
Like my father, all three of his sons were in the military. Dad, USMA ’38, served 35 years on active duty. A World War II veteran of the Pacific Theater, he was on the second plane into Japan after the surrender. He was in Viet Nam for only a few days, touring the South Vietnamese Military Academy when he was the Dean of the Academic Board. When a sniper fired at those in his jeep, Major Dave Palmer, who accompanied him, fired at the sniper. Dad credits him with saving his life. Palmer wrote the Military Art pamphlet, “Revolution in America” that we used as cadets. Palmer later became the Superintendent. Dad died at the VA Hospital in Montrose, NY. My mother could not take care of him any longer, as Alzheimer’s Disease took its toll. I’m not aware that he had any VA compensation, but they were there for him at the end.
My older brother Jack, USMA ’65, served 22 years in the Air Force. He was in Viet Nam around the same time I was, ’70 to ’71. Near the time of his retirement, Hodgkin’s lymphoma was first detected, but not treated. Since he was still on active duty at the time, after a lot of effort on his part, the Air Force took responsibility. The VA declared him 100% disabled for a time, but then downgraded him to below 50% after a while. When he applied, he had to agree that the amount of his military retired pay up to the amount of VA compensation had to be waived. So, in those days, the late 1980s, some of his paychecks were taxable, and some (VA) were not. I’m not sure of the numbers, but, for example, if he were getting $2500 a month retired pay from the Air Force, and the VA compensation were $1500, he was still getting $2500 a month, but only $1000 was taxed. Over time, the treatments he received for Hodgkin’s disease caused other problems, so he has been evaluated numerous times by the VA, and his rating has been changed several times. Still, he like many others, is not very happy with the VA because it seems like they are always trying to downgrade his application, often defying their own rules for achieving a particular rating.
The laws relating to Concurrent Receipt of Disability Pay (CRDP), which is taxable, and a newer Combat Related Special Compensation (CRSC) which is not taxed, and the amounts that are tax free have changed several times in the past fifteen or so years. Those who were able to have CRDP (taxable) were very happy because they could now get all of their retired pay plus the non-taxable VA compensation.
Several years later when CRSC came into being, Jack found out and applied for CRSC through the Air Force. It took the Air Force fewer than two months to approve his request. They notified Defense Finance and Accounting Service (DFAS). So now, as he describes it, he gets Military Retired Pay (taxable) and CRSC (non-taxable), both from DFAS, and VA compensation (non-taxable). The CRSC amount is the same as his VA amount.
I am the second son, but I’m going to treat my younger brother next. Dick turned down his appointment to USMA, opting instead for an ROTC Scholarship to Princeton. He served over six years, mostly in Germany, before embarking on a career in sales, mostly jet aircraft to other countries. He was never in a combat zone, so when he got prostate cancer, and ultimately died from it, there was never a question of VA compensation.
I had a stroke the day my brother died. I have aphasia. For a while, I couldn’t write, do math, figure anything out. I’m still not right, and that is my most serious health problem, but it has nothing to do with my military career. But since my brother died from prostate cancer, my urologist kept a close eye on me. When I had symptoms, he was right on it, and a surgeon removed my prostate.
I had 5 years active duty and 28 years in the Army Reserve. So, I got military retirement pay at age 60, based on 11 equivalent years of active duty. I went to the Pennsylvania Department of Veterans Affairs (DVA) to apply for VA compensation. One thing they asked was what my military retired pay amount was. I’m not sure why. They filled out the paperwork, and after a few months I got a lot of (to my mind, confusing) letters, ultimately saying I got VA compensation starting the first of the month after I submitted paperwork and I didn’t owe anything to DFAS. My only complaint with VA is they didn’t notify me about downgrading my rating several years later, so I had no chance to respond.
I met my older brother almost a year to the day after I filed for VA compensation. He was coming from Highland Falls to visit his son who lives near me, in Lancaster, PA. I was going to rendezvous with my daughter and grandkids in the Poconos. So, we met at a diner halfway. He asked if I got CRSC. I didn’t know. When I got home, I saw that I had CRDP, which is the first step. Looking at what I got from Pennsylvania DVA, I saw that I should have applied for CRSC after the first series of letters. They gave me the number for DFAS. So, I called DFAS. They told me I needed to contact my service—in my case, the Army.
I got a number from DFAS for US Army Human Resources Command (HRC). The person answering said to do it online. There was a problem with the software, so I couldn’t download it. A software engineer here was finally able to give me a form that I could write on. I filled it out, and nine months later got the approval. Get that – nine months later.
So, the next month, DFAS gave me a new Retiree Account Statement that said I had no taxable income. My Gross Pay was less that VA compensation, so all of it was now non-taxable. Until that time, monthly payments to the Survivor Benefit Plan (SBP) were taken from Gross Pay, (and therefore were not taxed) along with Income Tax Withholding, to result in Net Pay. There was no provision for DFAS to take money from CRSC to pay for SBP, so I was billed monthly for SBP. But after about six months there was a new provision signed into law that said DFAS could do so, and they did. But they gave me a form to show how much of my income should be adjusted for those payments.
So, you folks who are in this situation, that is, those who have a Military Pension and have a wound or a condition caused by exposure to Agent Orange in Viet Nam, should apply to HRC online. In the search box next to the login box in the upper right, type in “Apply for CRSC.” It will tell you what to do. Fill out DD Form 2860 (the download problem is now fixed) and wait. Hopefully that wait is not as long as mine.
But there’s more. Again, laws keep changing. When my brother first filed amended IRS returns because some of his income that had been taxed was declared non-taxable, he referred to an IRS Ruling 78-161, known as the Strickland Decision. He was not aware of CRDP, so he was very concerned that I was getting both VA compensation and my whole military gross pay. He searched for more than a month, so did I, about what paperwork was required to file an amended return for me. Online search was not helpful. The VA didn’t know. Neither did American Legion or Veterans of Foreign Wars, American Armed Forces Mutual Aid Association, or Military Officers Association of America. The Pennsylvania DVA told me I definitely could not do it.
But you can. Finally, my brother found it. I told the Pennsylvania DVA, and they responded with thanks, and said all their service officers would have this information to pass on to those who applied for VA benefits with them. I also wrote the American Legion, telling them that their service officers should get that training, but got no response.
Once you get your approval from HRC, which will say that you get CRSC from the date of your VA compensation, you can amend your returns for the last five years, if you need to. You can just go the IRS website and in the search box type in “Special Tax Considerations for Veterans” and you will see the two situations involved. My brother had the first situation as his VA compensation kept changing. Mine, and probably yours, will be the second, where you have CRDP and have now been approved for CRSC.
In my case, I was approved for CRSC in August of 2017, based on my VA approval date of 1 November 2015. I filled out 1040Xs for 2015 and 2016 right away. I had to wait until 2017 taxes were submitted the usual way before I was allowed to file an amended return for that year. In each case, it took another nine months or more to collect my refund. I got back around $15,000 altogether.
For 2015, the IRS gave me back more than they were supposed to. There’s more about that in another story about honesty. It’s so sad that people know just one little part of the whole, and when confronted with a pretty unique situation, can’t reason it out.
*Agent Orange was a tactical herbicide the U.S. military used to clear leaves and vegetation for military operations mainly during the Vietnam War.