This bill would allow veterans who have a service-connected disability rating of less than 50 percent to receive veterans’ disability compensation and retired pay simultaneously. It would also cover eligible retirees who had a service-connected disability rated at 30 percent or more and were forced to retire before attaining 20 years of service (also known as Chapter 61 retirement). These veterans may still be subject to some reduction in benefits due to concurrent receipts while they are phased into the system.
This would close a gap which prevents veterans from receiving the full amount of both their retirement pay and disability compensation, which is known as ‘concurrent receipt’. As the CBO explains: “Combat-related special compensation is exempt from federal taxes, but concurrent retirement and disability compensation is not; some veterans qualify for both types of payment, but they must choose between the two.”