Concurrent Receipt (CRDP) vs CRSC: November Checklist for Retirees

For military retirees, November isn’t just about Thanksgiving; it’s the start of “Open Season” for your benefits. This is the time of year when DFAS (Defense Finance and Accounting Service) finalizes your pay for the next year, and it’s the perfect time to review your retirement and disability pay.

The biggest question for many retirees is how to handle the two types of “concurrent receipt”: CRDP and CRSC.

You can not receive both at the same time. You must choose the one that pays you more. Here is your November checklist to make the right choice.

What is the “VA Waiver”? (The Problem)

By law, you cannot be paid twice for the same service. Because VA disability pay is tax-free, you must “waive” an equal amount of your military retirement pay (which is taxed) to receive it.

• Example: Your monthly retirement pay is $2,000. Your VA disability pay is $700. You will receive $700 from the VA (tax-free) and $1,300 from DFAS ($2,000 – $700).
• The Result: Your total income doesn’t change, but your tax burden gets lower.

CRDP and CRSC are the two major exceptions to this rule.

What is CRDP (Concurrent Retirement and Disability Pay)?

• What It Is: An automatic program that restores your VA waiver. You get your full military retirement pay and your full VA disability pay.
• Who is Eligible:
  1. You are a 20+ year (“blue water”) retiree.
  2. You have a VA disability rating of 50% or higher.
• How it Works: It’s automatic. If you meet the criteria, DFAS should enroll you.
• Tax Status: Your retirement pay is taxed. Your VA disability pay is tax-free.

What is CRSC (Combat-Related Special Compensation)?

• What It Is: A special tax-free payment that reimburses you for the VA pay that was waived from your retirement check.
• Who is Eligible:
  1. You are a retiree (20+ years, TERA, or medical).
  2. You have a VA rating for disabilities that are “combat-related.” This includes injuries from combat, training, or “instrumentalities of war” (like exposure to Agent Orange or burn pits).
• How it Works: You must apply using DD Form 2860. This is not automatic.
• Tax Status: The entire CRSC payment is 100% tax-free.

Your November Checklist: CRDP vs. CRSC

For most retirees, this is an easy choice.

• If your VA rating is below 50%, CRSC is your only option.
• If your VA rating is 50% or higher and your disabilities are not combat-related, CRDP is your only option.

The choice comes when you are a 20+ year retiree, rated 50% or higher, and some or all of your disabilities are combat-related.

1. Check Your DFAS “Open Season” Letter: DFAS will mail you a letter (or you can check MyPay) that outlines your options for the next year. It will show you the dollar amounts for CRDP vs. CRSC.

2. Compare the Dollar Amounts:

• CRDP: The amount is easy—it’s your full VA disability payment.
• CRSC: The amount is only for the disabilities that are approved as combat-related.
  • If your VA rating is 100% ($3,900) but only 30% ($550) of that is “combat-related,” your CRSC payment will only be $550.

3. Analyze the Taxable Difference:

• Scenario: You’re a 20-year retiree at 100% VA ($3,900), and 80% ($2,200) of it is combat-related.
• CRDP Choice: You get your full retirement pay (taxed) + $3,900 from the VA (tax-free).
• CRSC Choice: You get your full retirement pay (taxed), minus the $3,900 VA waiver. Then you get a $2,200 CRSC payment (tax-free).
• The Math:
  • CRDP gives you $3,900 (tax-free).
  • CRSC gives you $2,200 (tax-free).
  • Winner: CRDP is the clear winner by $1,700 per month.

When is CRSC better? CRSC is often better for retirees with lower combat-related ratings (under 50%) or for “Chapter 61” medical retirees with less than 20 years, who are not eligible for CRDP.

Review your pay, check your is combat related special compensation taxable status (it’s not!), and make sure you’ve chosen the option that puts the most money in your pocket.