VA Pension, Military Retirement, and Combat Pay

Three different checks. Different rules. Often confused for each other. This guide walks through each one in plain English: VA Pension (a needs-based program for wartime veterans), military retirement pay from DoD, and the two combat-related restoration programs called CRDP and CRSC.

Which of these might apply to you?

Wartime service + low income → VA Pension At least 90 days active duty (24 months if enlisted after Sept 7, 1980), one day during a wartime period, age 65+ or permanently disabled, income below MAPR, net worth under $163,699.
20+ years of military service → Military retirement (DoD) Pay from DoD via DFAS, calculated by years of service. Tax matters; combat doesn't matter for the base check.
Military retirement + VA disability rating 50%+ → CRDP path Restores the dollar-for-dollar offset that used to reduce retirement pay by the VA disability amount. Auto-enrolled.
Any military retiree with combat-related disability 10%+ → CRSC path Tax-free monthly payment for the combat-related portion of disability. Application required (DD Form 2860).

More than one can apply. Most retirees end up on either CRDP or CRSC (you can't take both at once), and VA Pension is rare for retirees because military retirement counts as income against the pension limit.

1. VA Pension (the needs-based program)

VA Pension is a monthly check from the Department of Veterans Affairs paid to low-income wartime veterans who are 65 or older or permanently disabled. It is not related to a service-connected disability and it is not the same as VA disability compensation. You cannot draw both at the same time; VA pays the higher of the two.

Eligibility checklist

Wartime service. At least 90 days active duty (24 months if enlisted after Sept 7, 1980), with at least one day during a wartime period.
Discharge under conditions other than dishonorable.
Age 65+, OR permanently and totally disabled, OR receiving SSDI/SSI, OR a patient in a nursing home for long-term care.
Net worth under $163,699 (income + assets, with primary home and one acre excluded). FY 2026 limit, in effect Dec 1, 2025 – Nov 30, 2026.
Countable income below MAPR. See table below.

Wartime periods (Congressionally defined)

War / Conflict	Begin	End
World War II	Dec 7, 1941	Dec 31, 1946
Korean conflict	Jun 27, 1950	Jan 31, 1955
Vietnam era (in-country)	Feb 28, 1961	Aug 4, 1964 (then below)
Vietnam era (general)	Aug 5, 1964	May 7, 1975
Gulf War	Aug 2, 1990	open (no end date set)

Source: VA wartime periods.

FY 2026 MAPR rates (Dec 1, 2025 – Nov 30, 2026)

MAPR is the Maximum Annual Pension Rate. VA pays you the gap between MAPR and your countable annual income.

Veteran status	Without A&A or Housebound	With Housebound	With Aid & Attendance
Single, no dependents	$17,441	$21,312	$29,094
With 1 dependent	$22,839	$26,710	$34,494
Two married vets, both A&A	—	—	$46,143
Two married vets: one A&A, one Housebound	—	—	$38,350

Source: VA pension rates. Add about $2,975 per additional dependent. Verify against VA.gov for your exact configuration.

Aid & Attendance vs Housebound (you can only get one)

Aid & Attendance

You need help from another person with daily activities (bathing, dressing, eating, toileting), OR you are bedridden, OR you are a patient in a nursing home, OR your eyesight is severely impaired (5/200 visual acuity or worse, or 5° concentric field).

Housebound

You are substantially confined to your home (or the immediate premises) due to permanent disability. Lower pay than A&A but easier to qualify.

How payment is calculated

Take MAPR. Subtract your countable annual income (most income, including Social Security, but you can deduct unreimbursed medical expenses). The result is your annual VA Pension. Divide by 12 for monthly.

Example: Single vet, no dependents, with Aid & Attendance. MAPR is $29,094. Countable income (Social Security minus medical expenses) is $14,000. Pension = $29,094 − $14,000 = $15,094 per year, or about $1,257 per month.

Net worth and the 36-month look-back

Net worth includes most assets plus annual income. The primary home (with up to one acre) and a vehicle are excluded. The 2026 limit is $163,699.

Look-back rule: If you transferred assets at less than fair market value within the 36 months before applying, VA can treat those transfers as if you still owned them. The penalty period can delay or reduce pension payments. Common trap: gifting a house to a child to qualify for pension or A&A.

Quick MAPR calculator

Estimate your annual pension. This is pure MAPR math, not an eligibility determination.

Your status

Your gross annual income ($)

Annual unreimbursed medical expenses ($) — optional. Out-of-pocket after insurance pays. Includes assisted living, in-home aide, Medicare Part B premiums, etc.

Only the portion of UME above 5% of your MAPR is deductible (per 38 CFR §3.278). For a single A&A vet, that 5% threshold is $1,454. Source: VA pension rate methodology.

Old Law Pension, Section 306 Pension, and Special Monthly Pension

Three pension programs have existed over the decades. The current Pension program (called Improved Pension) replaced two earlier ones in 1979. A small population of veterans and survivors still receives the older versions at protected rates.

Program	In effect	Status today
Old Law Pension	Before July 1, 1960	Closed to new applicants. Existing recipients kept on fixed protected rates.
Section 306 Pension	July 1, 1960 – Dec 31, 1978	Closed to new applicants. Existing recipients kept on fixed protected rates.
Improved Pension (covered above)	Jan 1, 1979 – present	Current program. All new applications go here.

Audience: Mostly elderly survivors of WWII, Korea, and early Vietnam veterans who began drawing pension before 1979 and never elected to switch.
Switch is irreversible. Old Law and Section 306 recipients can elect to move to Improved Pension at any time. The switch usually pays more (Improved has the A&A and Housebound add-ons) but it is one-way: you cannot switch back.
Special Monthly Pension in this context = the A&A or Housebound add-on under Section 306 or Old Law rules. It uses different fixed-rate logic than the Improved Pension version. Current protected rates.

Source: M21-1 Section C: Section 306 and Old Law Pension.

2. Military retirement pay (from DoD, not VA)

Military retirement is paid by the Department of Defense through the Defense Finance and Accounting Service (DFAS). It is completely separate from VA. There are two main flavors.

Length-of-service retirement

20+ years active duty, or 20 "good years" Reserve/Guard. Pay = (years × multiplier) × base pay average. Which exact formula depends on when you entered (Final Pay, High-3, REDUX, or Blended Retirement System).

Chapter 61 disability retirement

Service-issued retirement when DoD finds you unfit for continued duty AND assigns a disability rating of 30% or higher. Doesn't require 20 years. Pay calculated on the higher of years-of-service OR disability percentage.

Tax treatment

Length-of-service retirement: taxable as ordinary income (federal; state varies, with about 30 states fully exempting military retirement and others partially).
Chapter 61 retirement: the portion equal to your VA disability rating is excludable under Internal Revenue Code §104(a)(4). Example: a 60% Chapter 61 retiree pays tax only on the over-60% portion of their pay.

The historical "VA waiver" offset

Before 2003, federal law (10 USC §1414) prohibited drawing full military retirement and full VA disability at the same time. DoD reduced retirement pay dollar-for-dollar by the VA disability amount. That reduction is called the "VA waiver". Veterans gave up retirement pay to get tax-free VA disability because the math usually worked out.

Two programs now restore that waiver for many retirees: CRDP and CRSC.

Reserve and National Guard nuances

Reserve and Guard retirement runs on a different track:

20 "good years" are required to qualify (a year with 50+ retirement points), per 10 USC § 12731. A good year is not the same as a full year of active duty.
Pay starts at age 60, not at retirement. The window between hitting 20 good years and starting to draw pay is called the Gray Area Retiree period.
Reduced age for post-9/11 mobilizations: under § 12731(f), every 90 days of qualifying active service in a fiscal year shaves 90 days off the age-60 trigger. Floor is age 50.
Notice of Eligibility (NOE) is the document the Service issues at the 20-good-year mark. Keep it; it's how DFAS confirms eligibility.

Sanctuary protection (the 18-year rule)

If a servicemember is within 2 years of retirement (i.e., has 18+ years of active service), they cannot be involuntarily separated. The Service must retain them through the 20-year mark.

Active component enlisted: 10 USC § 1176. Service must keep the member on active duty until they qualify for retirement.
Active component officers: 10 USC § 12646 applies the same retention rule.
Reserve / Guard on active orders: If a Reservist on Title 10 mobilization crosses 18 years of cumulative active service, Sanctuary kicks in. The Service must keep them on active duty until 20-year retirement, OR get a written Sanctuary waiver from the member declining the right.

Common scenario: A Guard or Reserve member on a long deployment crosses the 18-year active mark mid-tour. They're now under Sanctuary and cannot be released back to drilling status without their consent. Some members discover this only when their Service tries to demobilize them.

Source: DFAS Gray Area Retirees.

3. CRDP: Concurrent Retirement and Disability Pay

CRDP restores the VA waiver dollar-for-dollar. If you qualify, you receive your full military retirement plus your full VA disability with no offset.

Eligibility

20 or more creditable years of military service, AND
VA disability rating of 50% or higher (any cause, doesn't have to be combat-related)

How to apply

You don't. CRDP is automatic. DoD and VA share data, DFAS confirms eligibility, and your retirement pay is restored without any action on your part.

Tax treatment

CRDP is taxable. It is restored military retirement pay, so it is taxed the same as your regular retirement pay.

Chapter 61 retirees: the years-of-service cap

Important nuance: Medical (Chapter 61) retirees with 20+ years of service can get CRDP, but only up to the amount of retirement pay they would have received based on years of service, not based on their disability rating. So if your DoD disability rating gives you a higher retirement pay than your years would have (e.g. 30 years × 2.5% = 75% vs 90% disability rating = 90%), CRDP only restores you to the 75% level.

Source: DFAS CRDP overview.

4. CRSC: Combat-Related Special Compensation

CRSC is a tax-free monthly payment for retirees whose VA-rated disability is combat-related. Unlike CRDP, CRSC is available even to medical retirees with fewer than 20 years of service.

What counts as "combat-related"?

A disability qualifies if it was incurred in any of these four ways (per 10 USC §1413a):

As a direct result of armed conflict (combat, peacekeeping, or under direct enemy fire)
While engaged in hazardous service (parachute duty, demolition, flight ops, diving)
Caused by an instrumentality of war (combat vehicle, weapon, exposure to Agent Orange, burn pit smoke, contaminated water at Camp Lejeune, etc.)
Incurred under conditions simulating war (combat training exercises, live-fire exercises)

Important: "Combat-related" for CRSC purposes is broader than people expect. Burn pit illnesses, Agent Orange presumptives, and serious training accidents commonly qualify.

Eligibility

Any military retiree, including Chapter 61 medical retirees with fewer than 20 years
VA disability rating of 10% or higher that is combat-related
Receiving military retired pay from DFAS

How to apply

Submit DD Form 2860 to your branch of service (not to DFAS, not to VA). Each branch has its own CRSC review board:

Army: U.S. Army Human Resources Command CRSC Branch
Navy & Marine Corps: Department of the Navy CRSC Board (one board for both)
Air Force & Space Force: Air Force Personnel Center CRSC Board
Coast Guard: Coast Guard PSC CRSC

Filing deadline: 6 years from any VA rating decision OR the date you became entitled to retired pay, whichever comes first.

Tax treatment

CRSC is tax-free. The statute (10 USC §1413a) makes it explicitly excludable.

Source: DFAS Apply for CRSC.

5. CRDP vs CRSC: the choose-one rule

If you qualify for both programs, you must elect one. You cannot receive both at the same time. The election happens during an annual open season.

Side-by-side comparison

	CRDP	CRSC
Tax treatment	Taxable	Tax-free
Combat connection	Not required	Required (10%+ combat-related)
Years of service	20+ required	Any (incl. <20 Chapter 61)
VA rating threshold	50% or higher	10% or higher
Application	Automatic, no form	DD Form 2860 to your branch
Restores VA waiver	Up to 100% of waiver	Up to combat-related %
Filing deadline	None	6 years from VA decision or retirement

Annual open season: January 1–31

If you are eligible for both, DFAS sends a comparison letter each December showing what each program would pay you. You have January 1 through January 31 to elect or change. Outside the open season, your election locks in.

Filing CRSC even if you take CRDP: DFAS lets you have the CRSC determination on file even if you currently elect CRDP. That way, if your situation changes, you can switch during the next open season without re-applying. The branch review can take many months.

Source: DFAS CRDP/CRSC comparison page.

6. How the three checks interact

Pay close attention to which agency cuts each check. Veterans often get confused because the names overlap.

Visual: where each dollar comes from on a typical retiree's pay stub

Gross military retirement pay→DoD / DFAS

Minus VA waiver−DoD / DFAS

Plus CRDP (if elected)+DoD / DFAS

Plus CRSC (if elected, tax-free)+DoD / DFAS

Plus VA disability compensation (separate check, tax-free)+VA

= Total monthly income=—

Key interaction rules

You cannot draw VA Pension and VA disability compensation at the same time. VA pays the higher of the two (38 CFR §3.700).
Military retirement counts as countable income against VA Pension. So a vet receiving even modest military retirement usually exceeds the MAPR and gets no VA Pension.
VA disability compensation is never offset regardless of your CRDP/CRSC election. It always pays in full.
CRDP and CRSC are mutually exclusive. Pick one per year during the January open season.

Tax matrix

Income source	Federal tax
VA Pension	Tax-free
VA disability compensation	Tax-free
Military retirement (length-of-service)	Taxable
Chapter 61 disability retirement	Partially excludable (the disability % portion)
CRDP	Taxable
CRSC	Tax-free

State tax treatment varies. Many states fully exempt military retirement; some don't. Check your state.

7. State tax treatment of military retirement (FY 2026)

Military retirement pay is always taxable at the federal level (with the Chapter 61 exception). State treatment varies and has shifted dramatically over the last decade. As of 2026, only California and Washington D.C. tax military retirement pay as ordinary income with no special break. Every other state either has no income tax or provides a full or partial military retirement exemption.

The table below classifies each state into one of four buckets. Click a column header to sort.

State	Treatment	Notes

Why this matters for CRDP vs CRSC: CRDP is taxable, CRSC is tax-free. In a state that doesn't tax military retirement, that delta shrinks. In California or D.C., the tax-free advantage of CRSC is meaningfully larger. Your election math depends on where you file your state return, not where you served.

Sources: Military Wallet 2026 state tax, Military Retirement Tax by State, Military.com. Always verify with your state's department of revenue. Some partial-exemption states have age, income, or rank thresholds that change which veterans qualify.

8. Survivors

The survivor side has three programs. Quick map:

Survivors Pension: needs-based, for low-income surviving spouses or unmarried children of deceased wartime veterans. Same MAPR-style logic. Current rates.
DIC (Dependency and Indemnity Compensation): flat monthly payment to surviving spouse or children when the veteran's death was service-connected. See our DIC guide.
SBP (Survivor Benefit Plan): DoD annuity the retiree elects from their own retirement pay (typically 55% of the retiree's pay if elected at full coverage).

The "Widows Tax" repeal: SBP-DIC offset is gone

Before 2021, a surviving spouse who qualified for both SBP and DIC had her SBP annuity reduced dollar-for-dollar by the full DIC amount. Advocacy groups called this the "widows tax". Congress repealed it in the FY 2020 NDAA with a 3-year phase-in:

Effective	SBP reduction
Before 2021	Full DIC offset (entire DIC subtracted from SBP)
Calendar year 2021	Reduced by no more than 2/3 of DIC
Calendar year 2022	Reduced by no more than 1/3 of DIC
January 1, 2023 onward	No offset. Surviving spouse receives both SBP and DIC in full.

Effect today: If you are a surviving spouse eligible for both, DFAS pays the un-offset SBP automatically. Survivors who had previously made a "child option" election (re-routing SBP to a child to dodge the offset) may want to revisit that election now that the offset is gone.

Sources: DoD SBP-DIC Offset Repeal FAQ · MOAA SBP-DIC offset resources.

9. Forms reference

VA Form 21P-527EZ: Veterans Pension application VA.gov →
VA Form 21P-0969: Income and Asset Statement in Support of Claim for Pension VA.gov →
VA Form 21-2680: Examination for Household Status or Permanent Need for Aid & Attendance VA.gov →
VA Form 21P-534EZ: Survivors Pension / DIC application VA.gov →
DD Form 2860: CRSC claim (filed with your branch of service) DFAS →

10. Frequently asked questions

I'm getting military retirement and VA disability. Which one is bigger?

It depends on years of service, base pay, and disability rating. A 100% VA rating in 2026 pays roughly $46,000/yr tax-free for a single vet (more with dependents). A 20-year retirement at E-7 pay grade is roughly $35,000–$40,000/yr taxable. Many retirees have one larger than the other, but most want both. That's why CRDP and CRSC exist. Run the actual numbers using our VA Math calculator for your specific rating.

I served Vietnam era but only 60 days. Do I qualify for VA Pension?

No. The minimum is 90 days of active duty (or 24 months for post-Sept 1980 enlistees), with at least one day during a wartime period. 60 days falls short of the 90-day floor regardless of which era.

Can I switch from CRDP to CRSC mid-year?

No. Elections lock in outside the January 1–31 open season. DFAS sends a comparison letter each December showing what each would pay, and the election window is the following January.

Does my Social Security count against VA Pension?

Yes. Most income, including Social Security retirement, SSDI, and pensions of any kind, count as countable income against MAPR. You can deduct unreimbursed medical expenses above 5% of MAPR, which often pulls the countable number down significantly for veterans paying for nursing care.

Are burn pit illnesses "combat-related" for CRSC?

Generally yes. Burn pit exposure is considered an "instrumentality of war" under the four-bucket test. Same logic typically applies to Agent Orange presumptives, Camp Lejeune water exposures, and other named hazardous environments. The branch's CRSC board makes the final determination on a case-by-case basis.

I'm a Chapter 61 retiree with 12 years of service. Can I get CRDP?

No, CRDP requires 20+ years. But you may qualify for CRSC for any combat-related portion of your disability. CRSC was specifically expanded in the 2008 NDAA to cover Chapter 61 retirees with fewer than 20 years.

I'm a 100% disabled vet, age 67, never served during a wartime period. VA Pension?

No. Wartime service is a hard requirement for VA Pension; peacetime-only service does not qualify. Your VA disability compensation continues unchanged.

Can my spouse get Aid & Attendance based on my benefits?

A surviving spouse may qualify for Survivors Pension with A&A. While both spouses are alive, the A&A add-on attaches to the veteran's pension based on the veteran's medical needs (or the spouse's needs in some configurations). See VA Survivors Pension rates.

Sources

VA Pension rates (FY 2026 MAPR): current MAPR table
VA Pension eligibility: wartime, age, and disability rules
VA Pension FAQ (PDF, April 2025): net worth, look-back, countable income
DFAS CRDP overview
DFAS Apply for CRSC: DD Form 2860 process
DFAS CRDP vs CRSC comparison
38 CFR §3.700: concurrent receipt of pension and compensation
38 CFR §3.750: entitlement to concurrent military retired pay and disability compensation
VA: how are pension and disability compensation different?

This page is an educational guide, not legal or tax advice. Pension, retirement, and combat-pay rules contain edge cases that depend on individual facts. For help with your specific claim or election, find a VSO representative. Related tools: VA Math calculator · DIC guide · Letter Interpreter.