SBP and RCSBP Factors
Should the surviving spouse remarry before age 55, the annuity is paid in equal
shares to eligible children under age 18, or under age 22 if a full-time student, unless handicapped. The coverage
stops when there are no eligible children. A dependent child may be an adopted child, stepchild, grandchild, foster
child, or recognized natural child who lived with the member in a regular parent-child relationship. A child disabled
before age 18, or before age 22 if a full-time student when the disability occurred, is an eligible beneficiary
so long as the disability exists and the child remains incapable of self-support. DFAS-DE reinstates a child’s
annuity when
a child between the ages of 18 and 22 reenters school on a full-time basis, or a disabling condition recurs making
the child incapable of self-support. Marriage at any age terminates a child’s eligibility. The monthly annuity
for children is 55 percent and is not reduced by DIC or when a disabled child attains age 62. Marriage at any age
terminates a child’s eligibility.
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Tax Implications. Survivor annuities are taxable income. You will receive a tax statement from DFAS-DE at the end of the year. The statement will show the full amount of the annuity payments you received and the total amount of tax withheld during the year. |
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Unless you elect otherwise, the amount of federal income tax withheld (FITW) will be as if you were a married individual claiming three exemptions. If you want your FITW changed at a later date, you must complete a new TD-Form W-4P, Withholding Certificate for Pension or Annuity Payments, showing the changes, and mail it to DFAS-DE/FRB, 6760 E. Irvington Place, Denver CO 80279-6000. |
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DFAS-DE withholds a 30 percent Federal income tax on annuities paid to nonresident aliens unless the beneficiary resides in a country that has a tax treaty with the United States specifying a different withholding rate. Address questions to the Internal Revenue Service, Assistant Commissioner (International), ATTN: IN:C:TPS, 950 L’Enfant Plaza South, SW, Washington DC 20024-2123, or contact the nearest American Embassy. |
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Annuities may be subject to Federal estate taxes. Beneficiaries should address tax questions to a legal assistance officer or the nearest Internal Revenue Service office. |
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A certificate of continued eligibility form will be sent to you each year prior to your birthday. Complete and return the form promptly so DFAS-DE can continue your annuity without interruption. Read the instructions on the form and make sure you have completed it correctly. Sign and date the form and send it to DFAS-DE/FRB, 6760 E. Irvington Place, Denver CO 80279-6000. |
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Dependency and Indemnity Compensation (DIC) Offset. DFAS-DE reduces a surviving spouse’s annuity by the amount of DIC the VA awards and pays the surviving spouse. The SBP annuity is not reduced by the amount of a child’s DIC entitlement. |
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The claim forms required to apply for this benefit are DD Form 1884, Application for Annuity Under the Retired Serviceman’s Family Protection Plan (RSFPP) and/or Survivor Benefit Plan (SBP), TD-Form W-4P, Withholding Certificate for Pension or Annuity Payments, and SF 1199A, Direct Deposit Sign-Up Form. DFAS-DE may require additional documents in order to establish an annuity (i.e., Representative Payee documentation; school certification; physician’s statement for disabled child over age 18). |
