The Concurrent Retirement and Disability Pay (CRDP) program allows eligible military retirees to receive a full military retirement pension and full VA disability compensation benefits at the same time.
Before CRDP and the Combat-Related Special Compensation (CRSC) programs were created, it was illegal for military retirees to claim both VA disability and military retirement pay. Now, if you are eligible for either program, you can claim the full amounts of both types of compensation.
What is the difference between CRSC and CRDP?
The core difference between CRDP and CRSC is how the veteran’s injury or injuries were sustained.
CSRC is only available to military retirees who sustained an injury in combat and have received a VA disability rating of 10% or higher. It’s tax-free and requires an application from the servicemember that includes proof of injury.
CRDP, on the other hand, is available to military retirees who have a service-connected injury and have a VA disability rating of 50% or higher. Your ratings may be based on a single injury or a combination of injuries.
Unlike CSRC, CRDP is applied automatically, does not require an application and is taxable.
If your injury is combat-related and you have a VA disability rating of 50% or higher, you are eligible for CRDP and CRSC. However, this does not mean you can enroll in both programs. In a case of dual eligibility, the Defense Finance and Accounting Service (DFAS) will enroll you in the program that results in a higher gross pay. You can change the program they select during their annual enrollment period.
CRDP Eligibility
CRDP is available for military retirees from all branches as long as they meet the eligibility requirements.
If you have a VA disability rating of 50% or higher and you meet one or more of the following criteria, you are eligible to claim CRDP:
- You are an active component military retiree.
- You are retired under the Temporary Early Retirement Act (TERA).
- You are a Guard or Reserve retiree with 20 or more Good Years and have met retirement age (60 in most cases, but some Reservists are eligible for early retirement).
- You are medically retired under Chapter 61 with 20 years or more.
Note: You may also be eligible for CRDP if you are a disability retiree who is entitled to retired pay under any provision of law other than solely entitled by disability. If you suspect you may be eligible under this provision, you can submit a written claim to DFAS.
To qualify for CRDP, you must have a service-connected disability, individual or combined, of 50% or higher. However, if your injury is combat-related, you may qualify for CSRC with a lower disability rating.
How much is CRDP pay?
The CRDP program began in 2004 and was rolled out over ten years to prevent a sudden increase to the national budget.
Most military members who retired between 2004 and 2014 had their military retirement pay increased by 10% each year until reaching full military retirement pay. The only exception was for retirees with a 100% disability rating. These retirees began receiving full military retirement pay immediately.
Servicemembers who retire after 2014 should automatically be enrolled in CRDP upon receiving an eligible VA disability rating and should automatically begin receiving the full amount of their military pension along with their VA disability compensation.
To calculate your CRDP, you simply add your awarded VA disability compensation to your monthly pension payment.
Let’s work through an example:
Let’s consider a retired E-7 with 20 years of service, a VA disability rating of 30%, and no dependents.
Military retirement pay is calculated using the highest average of 36 months of base pay and then multiplied by a rate that changes depending on your retirement plan.
We’ll assume that this veteran retired under the Blended Retirement System and use 2024 military pay and 2024 disability rates for our example.
According to the 2024 pay rates table, an E-7 with 20 years of experience would receive $5,758 in monthly base pay.
To find the estimated monthly retirement pay, we’ll take:
Base Pay × BRS Retirement Multiplier × Years of Service ($5,758 × 0.02 × 20) and get $2,303.20.
We can then find the pay for a veteran with a 30% disability rating and no dependents.
Then, we’ll add the full VA disability compensation for our example veteran’s disability rating and get the total monthly income under CRDP:
$2,303.20 (Military Retirement Pay) + $524.31 (VA Disability) = $2,827.51
Of course, taxes still need to be considered. Remember, military retirement pay is subject to federal income tax and is taxed by some states. However, VA disability is tax-free.
CRDP Back Pay
When you become eligible for CRDP, DFAS will run an automatic audit to determine if you are due back pay. CRDP back pay is payments made to military retirees to compensate for the gap between the date they became eligible for CRDP and the date they started receiving pay.
If DFAS finds that you are eligible for CRDP back pay (also called retroactive pay), they will forward your information to the VA, who is responsible for paying you.
DFAS states that their first priority is to start sending monthly CRDP payments, and that they will calculate and send back pay after. DFAS states that processing and delivering back pay can take between 60 to 90 days and, in some cases, require additional research in the form of an audit. If an audit is conducted, receiving your back pay may take even longer.
VA Audit for Back Pay
A VA Audit for Back Pay is when DFAS and the VA review your records to determine if the VA owes you money.
A common scenario for a VA audit for back pay is when retirees’ disability ratings change, entitling them to more CRDP. Sometimes, the DFAS system will not automatically take these changes into account. You can contact DFAS customer service between Monday and Friday, 8:00 a.m. to 5:00 p.m., at 1(800) 321-1080 to check the status of your back pay or request an audit.
VA Back Pay Limitations
CRDP retroactive pay only backdates to January 1, 2004. However, DFAS will only go back to the day you first received a 50% disability rating. If your 50% disability rating was retroactive, your eligibility will extend to that date, provided it isn’t before January 1, 2004.
Recently, the VA has begun extensive reviews of disability benefits ratings for military personnel from the Vietnam Era. Many veterans have begun receiving retroactive disability benefits for Agent Orange exposure and PTSD. If you are a military retiree who received retroactive disability compensation, then you may be eligible for retroactive back pay through the CRDP as well.
Other examples of back pay would be someone who retired and began receiving VA disability compensation several months after their disability compensation package was approved. In many cases, this can take some months.
Back pay awards may also be common for those whose disability claims were denied and later approved on appeal.
What if you don’t qualify for CRDP?
If you are a military retiree with a service-connected disability of 40% or lower, you don’t qualify for CRDP. In this case, your retirement pay is still subject to a disability offset or VA disability waiver.
The VA disability offset requires military members to waive part of their military retirement pay in order to receive VA disability compensation benefits.
This is usually a smart move because VA disability compensation is considered non-taxable income, whereas military retirement pay is taxable income.
To see how the VA offset affects pay, let’s work through an example.
VA Disability Offset Example
Assume a retired servicemember receives a monthly military retirement pay of $2,000, has been given a 20% disability rating by the VA, and has no dependents. This servicemember would receive $338.49 per month in disability (based on 2024 rates).
Calculation:
- Original Military Retirement Pay: $2,000 (taxable income)
- VA Disability Compensation: $338.49 (non-taxed income)
- VA Disability subtracted from Retirement Pay: $2,000 – $338.49 = $1661.51
In this example, the servicemember will receive $1,661.51 per month in retirement pay plus $338.49 per month as VA disability compensation. Their total monthly income from these sources remains $2,000, but now $338.49 of it is tax-free.
Retirees can elect not to waive military retirement pay and forgo receiving VA disability pay. However, waiving military retirement pay makes sense because the VA disability benefit is a non-taxable benefit, and military pensions are taxable income. Receiving VA disability pay will help retirees receive a larger net income.
The Value of CRDP
To understand the true value of CRDP, let’s use an example to show how much a retiree’s pay increases depending on their disability rating.
Let’s use the same example from above to show how the servicemembers’ pay would grow upon an increased disability rating.
| Example 2024 CRDP Monthly Pay with Increased Disability Rating | |||
| Disability Rating | Retirement Pay (taxable income) | Disability Pay (non-taxable income) | Total |
| 0% | $2,000 | $0 | $2000 |
| 10% | $2,000 | $171.23 | $2000 |
| 20% | $2,000 | $338.49 | $2000 |
| 30% | $2,000 | $524.31 | $2000 |
| 40% | $2,000 | $755.28 | $2000 |
| 50% | $2,000 | $1,075.16 | $3,075.16 |
| 60% | $2,000 | $1,361.88 | $3,361.88 |
| 70% | $2,000 | $1,716.28 | $3,716.28 |
| 80% | $2,000 | $1,995.01 | $3,995.01 |
| 90% | $2,000 | $2,241.91 | $4241.91 |
| 100% | $2,000 | $3,737.85 | $5,737.85 |
The takeaway is that a disability rating of 40% or less will offset taxable income with non-taxable income, resulting in large tax savings. However, a VA disability rating of 50% or higher is worth considerably more — in tax savings and overall compensation.
You can run a similar scenario with your own situation to get an idea of what concurrent receipt would be worth for your specific situation based on your retirement pay, years of service, and VA disability rating.
How to Submit a Claim for CRDP
If you are not receiving CRDP but believe that you are entitled to it, you can submit a written claim to DFAS.
To submit a claim, you must complete a DD Form 827, also known as an Application for Arrears in Pay. You can submit a signed form by mail, fax, or upload it through the askDFAS online tool.
To mail the form, send it to:
DFAS Retired and Annuitant Pay
8899 E 56th Street
Indianapolis, IN 46249-1300
You can also fax it to 1(800) 982-8459.
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CAPT Jim Booth, USN (Ret.) says
Hello Ryan,
Great web site and explanations. Thanks.
I have/had the same question as LTC Martin and have called DFAS without getting a solid answer. I think I understand your response to be that if a retiree was receiving compensation at 40% or less disability, SBP will be paid to a surviving spouse as though there was never an offset to retirement pay (i.e., 100% of previous retirement pay). To me, saying “55% of full military retirement pay” could mean 100% of retirement pay without disability compensation or 100% of what’s left after being paid disability compensation. Will you please clear this up?
I’ve searched high and low for an understandable reference with no luck. Thanks again for a great site!