M21-1 Manual / Part XII, Subpart i, Chapter 4, Section C

Survivor Benefit Plan (SBP) Offsets

M21-1, Part XII, Subpart i, Chapter 4, Section C

Overview

In This Section

This section contains the following topics:

Topic	Topic Name
1	General Information on the SBP and Dependency and Indemnity Compensation (DIC) Offset
2	A Surviving Spouse’s Benefit and Potential Offset
3	Retired Pay Centers’ (RPCs’) Handling of SBP Payments
4	Award Action for Claims Involving SBP

1. General Information on the SBP and DIC Offset

Introduction

This topic contains general information on the SBP and DIC offsets, including

provisions of SBP
payments to a claimant entitled to both SBP and DIC benefits
handling an overpayment of SBP
effective dates of DIC and SBP
reviewing for potential entitlement to SBP
paying full DIC benefits without withholding in certain cases, and
handling cases with no potential entitlement to SBP.

Change Date

April 18, 2023

XII.i.4.C.1.a. Provisions of SBP

Effective September 21, 1972, the Survivor Benefit Plan (SBP) was established under Public Law 92-425 for
retired service personnel, and
commissioned officers of the
Public Health Service (PHS), and
National Oceanic and Atmospheric Administration (NOAA).
SBP is handled by the following Retired Pay Centers (RPCs):
Defense Finance and Accounting Service (DFAS) for survivors of Army, Navy, Air Force, Space Force, and Marine Corps retirees, and
the Coast Guard for survivors of Coast Guard, PHS, or NOAA retirees.
Reference: For more information on the exchange of information between the Department of Veterans Affairs (VA) and RPCs, see M21-1, Part VI, Subpart ii, 4.C.3.

XII.i.4.C.1.b. Payments to a Claimant Entitled to Both SBP and DIC Benefits

Use the table below to determine whether the surviving spouse is entitled to receive the full amount of SBP and Dependency and Indemnity Compensation (DIC) benefits.

If the period of entitlement is …	Then the surviving spouse …
prior to January 1, 2021	is not entitled to receive the full amount of SBP and DIC benefits concurrently per 10 U.S.C. 1450(c)(1)(A).
during the period beginning on January 1, 2021, and ending on December 31, 2022	is entitled to receive a phased amount of SBP per 10 U.S.C 1450(c)(1)(B) and (C).
on or after January 1, 2023	is entitled to the full amount of SBP and DIC benefits concurrently, without offsets per 10 U.S.C. 1450(c)(1)(D).

Exception:

There is no bar to full payment of SBP and DIC benefits to a child or parent.
There is no bar to full payment of SBP and DIC when a surviving spouse is entitled to DIC by virtue of having remarried after attaining a qualifying age per Sharp, et al. v. United States, 580 F.3d 1234 (Fed. Cir. 2009).

References: For more information on

when there is no bar to receive the full amount of SBP and DIC when remarriage occurs, see 38 U.S.C. 1311(e)
entitlement to DIC when remarriage occurs, see M21-1, Part VII, Subpart i, 2.E, and
DIC rates for spouses and dependents, see the DIC rate tables.

XII.i.4.C.1.c. Handling an Overpayment of SBP

If SBP was paid to a surviving spouse entitled to DIC, VA offsets any overpayment of SBP from the DIC award in an amount not greater than the basic DIC payable. References: For information on

determining whether the surviving spouse is entitled to receive the full amount of SBP and DIC benefits, see M21-1, Part XII, Subpart i, 4.C.1.b
the full amount of SBP and DIC when remarriage occurs, see 38 U.S.C. 1311(e)
entitlement to DIC when remarriage occurs, see M21-1, Part VII, Subpart i, 2.E, and
DIC rates for spouses and dependents, see the DIC rate tables.

XII.i.4.C.1.d. Effective Dates of DIC and SBP

The effective dates of DIC and SBP do not coincide, because the effective date of

an SBP annuity is always the day following the date of death, and
DIC is determined under 38 CFR 3.400.

XII.i.4.C.1.e. Reviewing for Potential Entitlement to SBP

Due to the potential for large overpayments in DIC awards to surviving spouses also entitled to SBP, a review of SBP entitlement should be completed prior to generating an original DIC award to a surviving spouse for payment dates prior to January 1, 2023, that require an offset.Review the claims folder and electronic systems to determine whether the surviving spouse is potentially eligible for SBP benefits. Potential eligibility exists if the deceased Veteran was

retired, or
on active duty but eligible for retirement.

References: For more information on
determining whether the surviving spouse is entitled to receive the full amount of SBP and DIC benefits, see M21-1, Part XII, Subpart i, 4.C.1.b
a surviving spouse's benefit and potential offset, see M21-1, Part XII, Subpart i, 4.C.2, and
action to take to complete an SBP offset, see M21-1, Part XII, Subpart i, 4.C.4.c.

XII.i.4.C.1.f. Paying Full DIC Benefits Without Withholding in Certain Cases

In certain cases, VA can pay full DIC benefits without withholding. After a review of the Veterans Information Solution (VIS), if the surviving spouse is in receipt of SBP pay full DIC benefits without withholding or awaiting a response from DFAS if the following is true:

the surviving spouse has been receiving SBP for 12 months or less, andthecurrent SBP effective date is 10 years or more from the date of the Veteran’s death

the Veteran paid SBP premiums for 120 months, and the DIC award is no greater than 12 months retroactive, or

the payment date is on or after January 1, 2023, and the surviving spouse is entitled to the full amount of SBP and DIC benefits concurrently per 10 U.S.C. 1450(c)(1)(D).

Important:
For claims with an entitlement date prior to January 1, 2023, claims processors are required to submit the Phone Transaction Interface Veterans Affairs (PTIVA) form to DFAS notifying them that DIC has been paid in full.
For claims with an entitlement date on or after January 1, 2023, claims processors do not need the PTIVA submitted to DFAS.
See the SBP NUMBER OF MONTHS PAID field in VIS in the SBP INFORMATION segment under the DFAS PAYMENTS tab for the number of months the SBP premiums were paid.
Example: Notes:
This does not apply to Coast Guard Veterans, as per M21-1, Part XII, Subpart i, 4.C.2.h.
In all other cases regarding potential entitlement to SBP, VA must await a response from DFAS. However, claims processors may pay DIC as of the date last paid and continue the claim at authorization until a response is received. After a response is provided by DFAS, finalize the DIC award appropriately.
The current SBP effective date can be found in VIS under the SURVIVOR BENEFIT PLAN INFORMATION section, under the CURRENT SBP EFFECTIVE DATE field.
References: For more information on
determining whether the surviving spouse is entitled to receive the full amount of SBP and DIC benefits, see M21-1, Part XII, Subpart i, 4.C.1.b
coordinating the payment of DIC with DFAS, see M21-1, Part XII, Subpart i, 4.C.2.d, and
the PTIVA case form, see M21-1, Part XII, Subpart i, 4.C.2.e.

XII.i.4.C.1.g. Handling Cases With No Potential Entitlement to SBP

If there is no potential entitlement to SBP, the claims processor should enter No SBP payable in the REMARKS field of the DIC award.Note: If there are any questions as to whether or not SBP is payable and coordination is required because the payment date for DIC is prior to January 1, 2023, then take action as described in M21-1, Part XII, Subpart i, 4.C.2.d.Reference: For more information on determining whether the surviving spouse is entitled to receive the full amount of SBP and DIC benefits, see M21-1, Part XII, Subpart i, 4.C.1.b.

2. A Surviving Spouse’s Benefit and Potential Offset

Introduction

This topic contains information on a surviving spouse’s benefit and potential offset, including

VA and RPC policies concerning payment of DIC and SBP
replying to RPC inquiries regarding SBP
actions taken at the time of the RPC inquiry
coordinating the payment of DIC with DFAS
template for requesting information from DFAS
urgent PTIVA requests
sending sensitive documents through DFAS, and
coordinating the payment of DIC with the Coast Guard.

Change Date

January 12, 2026

XII.i.4.C.2.a. VA and RPC Policies Concerning Payment of DIC and SBP

VA and RPCs have no regulation preventing a surviving spouse from receiving DIC based on the death of one Veteran while also receiving SBP based on the death of another Veteran. There is no SBP offset in this case as the SBP offset is not related to the Veteran upon which the surviving spouse is receiving DIC. Note: Per Sharp, et al. v. United States, 580 F.3d 1234 (Fed. Cir. 2009), there is no bar to full concurrent payment of the SBP and DIC, without offset of either benefit, when a surviving spouse is entitled to DIC by virtue of having remarried after attaining a qualifying age. References: For more information on
payment of DIC when remarriage occurs, see M21-1, Part VII, Subpart i, 2.E, and
full concurrent payment of SBP and DIC when remarriage occurs, see 38 U.S.C. 1311(e).

XII.i.4.C.2.b. Replying to RPC Inquiries Regarding SBP

RPCs submit requests to VA regarding a surviving spouse’s DIC payments. When replying to RPC inquiries, furnish the

basic DIC rate per 38 CFR 3.5, and
award effective date (for example, the first day of the month of the Veteran’s death).

Note: The basic DIC rate
means the rate payable to the surviving spouse as if there were no children (total dependency code 10) based on the Veteran’s pay grade or the rate specified under 38 U.S.C. 1311(a)(1), as applicable, excluding any allowance for aid and attendance, and
includes the additional allowance payable under 38 U.S.C. 1311(a)(2) to the surviving spouse of a Veteran who was
rated as totally disabled for at least eight continuous years, and
married to the surviving spouse for the same period of time.
Important:
In an apportionment case, if the amount paid to the surviving spouse is less than the basic DIC rate, consider the lesser amount to be the basic DIC rate for the purposes of this section.
Do not consider the Veteran’s rate for the month of death as the DIC rate for reporting purposes.
Reference: For more information on the DIC rate payable, see M21-1, Part XII, Subpart i, 1.A.

XII.i.4.C.2.c. Actions Taken at the Time of the RPC Inquiry

If at the time of the RPC inquiry, a DIC claim

is pending, wait to respond until after the claim is complete, or
has not been filed or has been denied, upload the form to the electronic claims folder (eFolder).

XII.i.4.C.2.d. Coordinating the Payment of DIC With DFAS

Before paying the full DIC rate to a surviving spouse with potential eligibility for SBP benefits based on service in the Army, Navy, Air Force, Space Force, and Marine Corps, determine whether

the surviving spouse is receiving SBP benefits, and (if so)
payment of DIC will create an overpayment.

Many pension management center (PMC) employees have access to DFAS’ Defense Retiree and Annuitant Pay System-Annuitant Pay Subsystem (DRAS-APS). PMC employees also have access to VIS, which is a web-based application that provides a consolidated view of eligibility and benefits data from the Veterans Benefits Administration and Department of War (DOW). This system often contains the information required to make the determinations referenced above without making direct contact with DFAS. When it does not, or when access to DRAS-APS or VIS does not exist, either the finance activity or PMC must send a request to DFAS through the Safe Access File Exchange, using the template shown in M21-1, Part XII, Subpart i, 4.C.2.e. If a request is sent to DFAS, claims processors may pay DIC as of the date last paid and continue the claim at authorization until a response is received. After a response is provided by DFAS, finalize the DIC award appropriately. If DFAS does not respond within 10 workdays, follow up by telephone at 1-866-622-4602, option 2. Exception: Do not postpone payment of full DIC benefits for a response from DFAS if the criteria of M21-1, Part XII, Subpart i, 4.C.1.f has been met. Important: Claims processors must still send the PTIVA to DFAS notifying them that DIC has been paid in full.Notes:
It is acceptable to request information from DFAS by telephone, using the number provided above, but only when an expeditious response is required.
Document any telephone contact with DFAS on VA Form 27-0820, Report of General Information.
The Manila Regional Office (RO) contacts DFAS by email rather than by telephone.
SBP is not paid to the surviving spouse through DFAS for Veterans of the Coast Guard, PHS, or NOAA. For SBP payments for Veterans of the Coast Guard, PHS, or NOAA, see M21-1, Part XII, Subpart i, 4.C.2.h.
Reference: For more information on VIS, see
M21-1, Part VI, Subpart ii, 4.C.2, and
VIS User Guide.

XII.i.4.C.2.e. Template for Requesting Information From DFAS

Use the template below (PTIVA Case Form) when sending a request to DFAS for information about the payment of SBP benefits to a surviving spouse. All of the fields under each of the following headings must be completed:
VETERAN INFORMATION
SPOUSE INFORMATION
VA POINT OF CONTACT FOR OVERPAYMENT INFORMATION, and
DIC INFORMATION.
Note: Some of the fields listed below have drop-down boxes. Users must select the appropriate drop-down option or, when required, a typed response for each box below:
BRANCH OF SERVICE
VARO
BASED ON VA HIGHEST GRADE HELD (YES/NO)
VA HIGHEST GRADE HELD (PLEASE TYPE)
INITIAL BASIC SPOUSAL RATE
PTIVA ATTEMPT NUMBER, and
DIC RETRO PAYMENT DISPOSITION.
Important: When completing the fields under the VA POINT OF CONTACT FOR OVERPAYMENT INFORMATION heading, users must provide the following:
appropriate area code for the phone number
local PMC fax number, and
statement in the COMMENTS field informing DFAS of the alternative option to submit a response via QuickSubmit such as, DFAS may now respond to VA’s request via QuickSubmit at https://access.va.gov.

XII.i.4.C.2.f. Urgent PTIVA Requests

Urgent PTIVA requests will be handled using the existing points of contact (POCs) between the PMCs and DFAS and do not have to follow the identified schedule. If the PTIVA request has already been sent to DFAS, then the PMC POC should call the DFAS POC. Re-sending the PTIVA should not be necessary unless requested by DFAS.

XII.i.4.C.2.g. Sending Sensitive Documents Through DFAS

Follow the steps in the table below for sending sensitive documents through DFAS.

Step	Action
1	Access the DFAS website.
2	On the DFAS home page, select the AskDFAS icon in the upper right-hand corner of the page. *Example*: -
3	Click on the Retirees and Annuitants picture. *Example: A drop-down will appear with links. Under Ask a Question Online, click on the Submit a question* link.Example:
4	The Submit a question link will take the user to the AskDFAS website. A DOW consent prompt will appear. Read the prompt and click the Agree button. Click the Submit A Ticket button to start the ticket process. *Example*:
5	The Submit A Ticket button will take the user to the category and subcategory section. Click on the arrows next to Used Only by BoS/Fed Agency Partners-Form Uploads. A list of subcategories will populate. Click on the arrows next to PTIVA - Upload to open a ticket. *Example*:
6	The Category will show Used Only by BoS/Fed Agency Partners-Form Uploads and the Subcategory will show PTIVA - Upload.Example:
7	After verifying the correct Category and Subcategory, the user will begin to complete the form. The required fields to complete the form are NAME (first and last) EMAIL RE-ENTER EMAIL PASSCODE Note: The same passcode can be used for all tickets BOS / FEDERAL AGENCY Note: The drop-down selection will be VA PHONE NUMBER AND EXTENSION Note: If no extension is available, input NA UNIT, INSTALLATION, OR OFFICE Note: Enter the division and location that you work in, and NUMBER OF UNIQUE CUSTOMERS INCLUDED. Note: Users will also be prompted to check the box under PAY PARTNER CONFIRMATION confirming that they understand the requirements and that they are eligible to submit a ticket.
8	Click Choose File and navigate to the required documents to be submitted. Click on the document and then click Open. Repeat this step to attach up to 10 documents to the Attachment Section.*Example: Notes: The maximum number of attachments is set to 10. The size of the 10 attachments cannot exceed 35 MB. Each attachment must be for a separate Social Security number. Each attachment must be in Single PDF* format. The PDF cannot contain embedded attachments within the PDF.
9	Click Upload File(s) to upload the files to the ticket. A green check will appear next to the attachment as a confirmation. *Example*:
10	Submit the ticket. *Example*:
11	After the ticket is submitted, an email notification will be sent to the user that a ticket has been opened.
12	The user will need to regularly check the link provided in the email. Once the ticket is closed, a response will be provided in the link from the email notification.

XII.i.4.C.2.h. Coordinating the Payment of DIC With the Coast Guard

SBP is not paid to the surviving spouse through DFAS for Veterans of the Coast Guard, PHS, or NOAA. Therefore, the SBP information cannot be found in VIS or DRAS-APS. Before paying DIC to a surviving spouse based on the Veteran’s service in the Coast Guard, PHS, or NOAA, claims processors must contact the Coast Guard to obtain the following information:

whether the surviving spouse is receiving SBP benefits, and (if so)
whether payment of DIC will create an overpayment.

The contact numbers for the Coast Guard are

1-866-772-8724 for telephone, and
1-785-339-3770 for fax.

Notes:

Document any telephone contact with the Coast Guard on a VA Form 27-0820.
The Manila RO contacts the Coast Guard by email rather than by telephone.
Claims processor can request the Coast Guard submit the response through the local RO fax line or an approved VA claims submission service website such as QuickSubmit.

3. RPCs’ Handling of SBP Payments

Introduction

This topic contains information on RPCs’ handling of SBP payments, including

initial action taken by RPCs
action taken when no claims folder exists, and
how the PMC of jurisdiction is determined.

Change Date

July 12, 2015

XII.i.4.C.3.a. Initial Action Taken by RPCs

RPCs

begin payment, regardless of whether or not DIC is payable, if a surviving spouse is entitled to SBP, and
sends notification to the PMC of jurisdiction that provides information as to when SBP payments begin.

Note: RPCs are not required to send VA a signed authorization from the surviving spouse to offset DIC based on SBP payments. By signing the application for SBP, the surviving spouse authorizes VA to offset DIC based on SBP payments.

XII.i.4.C.3.b. Action Taken When No Claims Folder Exists

If notification is received from the RPC and the Beneficiary Identification and Records Locator Subsystem shows that no claims folder exists

establish an eFolder, and
include sufficient information to alert the next person who reviews the folder of a potential DIC-SBP payment overlap should DIC be awarded to the annuitant at a later date.

XII.i.4.C.3.c. How the PMC of Jurisdiction Is Determined

The PMC of jurisdiction is

indicated by the RPC’s records, and
determined, if not of record, based on
- beneficiary's residence, or
- the address to which the payments are provided.

4. Award Action for Claims Involving SBP

Introduction

This topic contains information on award action for claims involving SBP, including

Veterans Benefits Management System (VBMS) award processing
considering a DIC claim not timely filed
action to take to complete an SBP offset, and
providing notice to a claimant.

Change Date

November 17, 2022

XII.i.4.C.4.a. VBMS Award Processing

Use the Veterans Benefits Management System (VBMS) to process awards for DIC. Reference: For more information on processing awards in VBMS, see the VBMS Awards User Guide.

XII.i.4.C.4.b. Considering a DIC Claim Not Timely Filed

Deductions for an SBP overpayment can be made only from the effective date of the DIC award, instead of the effective date of SBP payments, if

a DIC claim is not filed within one year from the date of death of a Veteran, and
the claimant is receiving SBP.

Reference: For more information on completing an SBP offset, see M21-1, Part XII, Subpart i, 4.C.4.c.

XII.i.4.C.4.c. Action to Take to Complete an SBP Offset

The table below describes the stages for completing an SBP offset.

Stage	Who Is Responsible	Description
1	Claims Processor	Generates DIC award, and forwards to authorizer for review.
2	Authorizer	Reviews award for accuracy, and forwards the RPC payment information to the finance activity to request a deduction (offset) to recoup the SBP overpayment. *Note*: When sending a memorandum to the finance activity for the creation of an offset, the amount must not exceed the retroactive amount.
3	Finance	Creates a deduction (offset) in the amount requested, and notifies authorizer of completion.
4	Authorizer	Reviews corporate to verify that the deduction (offset) was created, and authorizes the award.

Notes:

If the pay grade is required to generate the DIC award, but not known, the claims processor should check DRAS-APS and VIS to see if the pay grade is available. If the pay grade is unavailable, contact the Retired Pay Coordinator. The Retired Pay Coordinator must telephone DFAS to obtain the correct pay grade.
Do not complete SBP offsets to DIC payments after the retroactive payment has already been paid. When an SBP overpayment is discovered after the DIC award is finalized, DFAS should establish arrangements with the annuitant to reduce future SBP payments to recoup the overpayment.

Reference: For more information on SBP overpayment, see the M24-2, Chapter 7.

XII.i.4.C.4.d. Providing Notice to a Claimant

In all DIC awards involving an SBP deduction, prepare a locally-generated award letter per 38 CFR 3.103(f) that fully advises the claimant

of the award, and
that the award is subject to offset for concurrent payments of the SBP annuity.

In initial or supplemental DIC awards involving SBP benefits, enclose VA Form 21P-8765, Service-Connected Death Award Attachment, with the locally generated award letter.

Source: VA M21-1 Adjudication Procedures Manual, M21-1, Part XII, Subpart i, Chapter 4, Section C (U.S. government work, reproduced for reference). Browse all sections →