Survivor Benefit Plan (SBP)

Army Reserve: Drilling

Benefit Fact Sheet

Tweet
Share

Summary:

Military pay, including active duty pay and allowances and retired pay, stops upon a Soldier's death. The Survivor Benefit Plan (SBP) is a program through which the Department of Defense provides monthly, cost-of-living-adjusted income to eligible survivors of Soldiers who die on Active Duty, including Reserve Soldiers and National Guard Soldiers who die on Federal Active Duty, and of Retirees who choose to continue participating in the program after they retire.

Soldiers who retire due to a service-connected disability incurred while on active duty, whether Regular or Reserve, may participate in SBP.

Reserve and National Guard Soldiers may participate in the Reserve Component-Survivor Benefit Plan (RCSBP) when they complete 20 years of qualifying service for non-regular retirement.

The following table illustrates which program applies to whom, depending on one's duty status and retirement eligibility:

 

Survivor Benefit Plan (SBP) Eligibility

Regular Army on active duty

SBP. Benefits calculated as if retired with 100% disability. Death must be in Line of Duty unless retirement-eligible If retirement eligible and LOD Not In Line of Duty, benefits based on years of active service.

Regular Army retired

SBP, if they enroll upon retirement. Line of Duty determination not applicable.

Reserve and National Guard Soldiers in non-drilling status with less than 20 years of service

No SBP or RCSBP.

Reserve and National Guard Soldiers on Inactive Duty Training

RCSBP. Benefits calculated based on points earned as of date of death. Death must be in Line of Duty. If retirement eligible and LOD Not In Line of Duty, benefits based on years of active service.

Reserve and National Guard Soldiers on Federal Active Duty, regardless of years of service

SBP. Benefits calculated as if retired with 100% disability. Death must be in Line of Duty. If retirement eligible and LOD Not In Line of Duty, benefits based on years of active service.

Reserve and National Guard Soldiers in non-drilling status with at least 20 years of service

RCSBP. Only if they enrolled with Option B or Option C when they received 20-Year Letter; or received the 20 year letter, are within the 90 day period, but have not made an RCSBP election; or should have received a 20 year letter. Death does not need to be in Line of Duty.

Reserve and National Guard Soldiers at age 60 who had enrolled in RCSBP with Options B or C

At age 60 RCSBP for non-regular Reserve Retirees becomes SBP. Line of Duty determination not applicable.

Reserve and National Guard Soldiers at age 60 who had not enrolled in RCSBP (elected Option A)

SBP. Only if they enroll in SBP upon receipt of retired pay. Line of Duty determination not applicable.

Reserve and National Guard Soldiers over age 60 who had not enrolled in either RCSBP or SBP

No SBP or RCSBP.

Eligibility:

Army Reserve Soldiers on Inactive Duty Training are covered under RCSBP. Army Reserve Soldiers on all types of Active Duty are covered under SBP. SBP benefits are calculated differently depending on a Reserve Soldier's duty status at time of death. After completing 20 years of creditable service, Reserve Soldiers become eligible to participate in the Reserve Component - Survivor Benefit Plan (RCSBP), which provides benefits to their survivors if they die outside of active duty. RCSBP also covers National Guard Soldiers who die on inactive dutyin the line of duty.

SBP Beneficiaries:

Benefits to survivors of Reserve Soldiers who die on Active Duty are paid SBP's Spouse-and-Child beneficiary category. Benefits to survivors of Reserve Soldiers who die on Inactive Duty Training are paid under unique provisions that differ from those applicable to Reserve Soldiers who die on Active Duty.

Eligibility of Survivors of Reserve Soldiers who die on Active Duty:

Survivors of Reserve Soldiers who die in the Line of Duty may be eligible to receive SBP benefits. There are six categories of survivors who may receive benefits:

1. Spouse
2. Child(ren) Only
3. Spouse-and-Children
4. Former Spouse
5. Former Spouse-and-Child(ren)
6. Insurable Interest

Eligibility of Survivors of Reserve Soldiers who die on Inactive Duty Training:

Eligibility of survivors of Reserve Soldiers who die on Inactive Duty Training differs from that for all other duty statuses in that:

** Benefits are paid to a former Spouse if there is a court order requiring the Soldier to name the former Spouse as beneficiary that existed prior to the Reserve Soldier's death even if the Soldier has a Surviving Spouse and/or children.

** If no former Spouse exists, benefits are paid to the Surviving Spouse, regardless of whether the Soldier had children. Benefits pass on to eligible children ONLY if the Surviving Spouse dies (which differs from all other duty statuses for which benefits also pass on to eligible children if the Surviving Spouse dies or remarries before age 55).

** Benefits are payable to eligible children ONLY if there is no Surviving Spouse or eligible former Spouse at time of death OR if the Surviving Spouse dies.

** Surviving Spouses do NOT have the option to forego SBP benefits for themselves and have them paid to the Soldier's Children to avoid the DIC offset.

** Benefits are NOT payable to anyone other than those listed above, i.e. benefits are NOT payable to a person who had an insurable interest in the Soldier by being dependent on the Soldier for more than half of their support.

Benefit Highlights:

On Active Duty: Benefits are 55 percent of what the Reserve Soldier's retired pay would have been if he or she had retired with 100 percent disability on date of death (i.e. 75 percent of the average of the highest 36 months of active duty base pay*). For example, if the average of the highest 36 months of base pay for a Soldier is $4,150, his or her retired pay would have been $3,112 if retired with 100 percent disability ($4,150 x 75% = $3,112). The SBP annuity would be $1,711 ($3,112 x 55% = $1,711).

On Inactive Duty Training: Benefits are 55 percent of what the Soldier's retired pay would have been based on years of service, including points. For example, if the Soldier above has 4,000 points, that equates to 11.11 years of service (4000 divided by 360 = 11.11). If the average of this Soldier's highest 36 months of base pay* is $4,150, retired pay would have been $1,152 ($4,150 x 2.5% (rate per year of service) x 11.11 = $1,152). The SBP annuity, if he or she died while on Inactive Duty for Training, would be $633 ($1,152 x 55% = $633).

*Retired pay for Service members who entered service before 8 September 1980 is based upon their final pay rather than on the average of their highest 36 months of base pay.

Non-Drill Status with 20 years or more of service, under age 60: Benefits would be dependent upon which RCSBP option the Soldier elected when he or she signed up for RCSBP upon receipt of his or her 20-Year Letter (Notice of Eligibility to receive retired pay at age 60). Option A would not pay any benefits because the Soldier deferred enrolling until age 60. See the "ARMY RESERVE: RETIRED" fact sheet in this series for more information about SBP.) Option B would pay an RCSBP annuity when the Reserve Soldier would have reached age 60. Option C would pay an RCSBP annuity immediately upon the Soldier's death. If Soldier does not make an election, they automatically receive Option C coverage for dependents at the time of receipt of Notice of Eligibility. The RCSBP annuity would be calculated the same way as the SBP annuity described above for a Soldier on Inactive Duty Training (based on points). However, if the Soldier elected a reduced "Base Amount" rather than full-retired pay, the SBP annuity would be 55 percent of that reduced "Base Amount". (A "Base Amount" can be any amount between $300 and full-retired pay.)

Beneficiaries:

Spouse-and-Child(ren): For survivors of married Soldiers with Children, benefits (referred to as an "annuity") are most often paid under the "Spouse-and-Child(ren)" category. Under this category, the Surviving Spouse is the primary beneficiary, and benefits pass on to eligible Children only if the Surviving Spouse dies or remarries before age 55. If the Surviving Spouse remarries before age 55, eligibility is "suspended", which means that eligibility is restored if the Surviving Spouse's marriage ends by death or divorce. Remarriage after age 55 has no effect on a surviving Spouse's eligibility to receive benefits.

Integration with Dependency and Indemnity Compensation (DIC): Surviving Spouses and minor Children of Soldiers or Retirees whose deaths are determined to be service-connected by the Department of Veterans Affairs (VA) are entitled to tax-free compensation from the VA. This benefit is called Dependency and Indemnity Compensation (DIC). Under current law, the SBP payment to a Surviving Spouse is offset (reduced) dollar-for-dollar by the amount of spousal DIC compensation. If a Surviving Spouse authorized both SBP and DIC remarries after age 57, a court case allows receipt of SBP without an offset by DIC.

If the SBP entitlement is $1,500 and the spousal DIC amount is $1,233 (effective December 1, 2013), then the SBP annuity is reduced to $267 ($1,500 - $1,233 = $267). The combined total of SBP and DIC is still $1,500, but $1,233 of it is tax-free. Children are also eligible to receive DIC, but their SBP annuities are not reduced by DIC.  Any premiums paid for SBP coverage by a retiree that is offset by DIC will be refunded to the Surviving Spouse.

A Surviving Spouse whose SBP annuity is offset by DIC is entitled to a monthly Special Survivor Indemnity Allowance (SSIA) from the Department of Defense. In Fiscal Year 2014, the monthly payment is $150. It will increase to $200 during FY 2015, to $275 during FY 2016, and to $310 during FY 2017. There are no provisions in current law to extend SSIA beyond FY 2017. SSIA is payable only to Surviving Spouses because Children's SBP annuities are not offset by DIC. SSIA does not apply to Spouses of Reservists who die on Inactive Duty for Training.

Child(ren) Only: Eligible Children are the beneficiaries. Benefits are divided equally among all eligible Children. If the SBP annuity is divided among multiple Children, as each Child ages beyond the eligibility limit, the annuity is reapportioned among the remaining Children. Ultimately, the youngest Child ends up receiving the entire annuity, which then terminates when the youngest Child reaches the eligibility limit. Eligible Children include natural Children, adopted Children, stepchildren, and foster Children who lived with the Soldier in a normal parent-Child relationship. Children may receive SBP benefits until age 18, or age 22 if enrolled full-time in high school, college, vocational or technical school, or another recognized educational institution. An exception is that if a Child reaches age 22 while in school, and his or her birthday is before 1 July or after 31 August, eligibility continues until the earlier of the Child's cessation of full-time studies or the . A Child who becomes incapable of self-support due to a physical or mental disability before age 18, or before age 22 while a full-time student, may receive benefits for life, as long as he or she remains unmarried. Prior to electing SBP coverage for an incapacitated Child, the retired or retiring Soldier should research the effect of the SBP income on other benefits to which the incapacitated Child may be eligible under state or local welfare or support programs.

Important Decision for Surviving Spouses: Because of the integration of SBP and DIC for a Surviving Spouse, Surviving Spouses of Soldiers who died on Active Duty may choose to forego receiving SBP benefits themselves and, instead, have benefits paid to surviving Children, whose benefits are not integrated with DIC. This permanent election cannot be reversed. When the last Child is no longer eligible for SBP, the SBP annuity stops and will not revert to the Surviving Spouse. Surviving Spouses, therefore, should give careful consideration before relinquishing this important benefit. Children's ages and health, and even the Surviving Spouse's likelihood of remarrying while the Children are young, should be considered (since benefits would pass on to eligible Children anyway if the Surviving Spouse remarries before age 55). When Surviving Spouses forego SBP benefits for themselves and, instead, have benefits paid to surviving Children, they will not receive Special Survivor Indemnity Allowance (SSIA).

Former Spouse: SBP benefits may be payable to the former Spouse of a Reserve Soldier who had Former Spouse RCSBP court ordered or voluntary. In this situation, the assignment of SBP benefits to the former Spouse would preclude payment of benefits to a Reservist's Surviving Spouse. Remarriage of the former Spouse before age 55 suspends the former Spouse's eligibility to receive SBP benefits, although eligibility is restored if that marriage ends by death or divorce. Former Spouses are not eligible to receive DIC from the VA, so they are, therefore, not eligible for SSIA. Likewise, since there is no DIC offset to their annuities, they do not have the option if reservist's death was on active duty to forego SBP benefits for themselves and have them paid to the Soldier's Children.

Former Spouse-and-Child(ren): If a former Spouse is awarded SBP benefits as described above, any eligible Children acquired by the Soldier during his or her marriage to the former Spouse may be included as successor beneficiaries. The same eligibility criteria for Children described above under the "Child(ren) Only" paragraph apply.

Insurable Interest: If, upon the active duty death of a Soldier, there is no eligible former Spouse, Spouse, or Children, benefits may be paid to a natural person who was either at the Soldier's death a dependent with a military Dependent ID card or would have been authorized a dependent ID card. Benefits are payable for life. The SBP annuity is calculated at 55 percent of what the Soldier's retired pay would have been if the Soldier had retired with a 100 percent disability on his or her date of death after first subtracting from the retired pay base the premium the Soldier would have paid for coverage if the Soldier had retired and elected such coverage. That premium is 10 percent of retired pay, plus an additional 5 percent for each full 5 years the beneficiary is younger than the Soldier. The annuity for qualifying parents is, effectively, 49.5 percent of what the Soldier's retired pay would have been.

Continuing Eligibility: Surviving Spouses and former Spouses are eligible to receive SBP benefits for life. Eligibility is suspended if a Surviving Spouse or former Spouse remarries before age 55, but eligibility is restored if that marriage ends by death or divorce. Remarriage after age 57 allows a Surviving Spouse authorized both SBP and DIC to receive SBP without an offset by DIC.

Surviving Children may receive SBP benefits until age 18, or age 22 if enrolled full-time in high school, college, vocational or technical school, or another recognized educational institution. An exception is that if a Child reaches age 22 while in school, and his or her birthday is before 1 July or after 31 August, eligibility continues until the earlier of the Child's cessation of full-time studies or the 1st day of July following that birthday. A Child who becomes incapable of self-support due to a physical or mental disability before age 18, or before age 22 while a full-time student, may receive benefits for life, as long as he or she remains unmarried.

SBP Beneficiaries receiving benefits under the "Insurable Interest" beneficiary category remain eligible for life, regardless of age, marital status, or receipt of any other government benefit.

Additional Information:

For more information, please contact your nearest installation RSO and or visit the SBP web page maintained by the Army Retirement Services Office (Army RSO), Army G-1: (A listing of installation RSOs is available on the Army RSO web page.)
http://soldierforlife.army.mil/retirement/sbp.html

To obtain a detailed estimate of your survivor benefits, including SBP payments to eligible dependents, visit the MyArmyBenefits Survivor Calculator (AKO account needed):
http://myarmybenefits.us.army.mil/Home/Benefit_Calculators/Survivor_Benefits.html

Office of the Secretary of Defense, Military Compensation SBP website:
http://militarypay.defense.gov/survivor/sbp/01_overview.html

Army Casualty:
https://www.hrc.army.mil/TAGD/CMAOC

DFAS "Manage your SBP Annuity" website:
http://www.dfas.mil/retiredmilitary/survivors/manage.html

Document Review Date: 27 February 2014