What Is Concurrent Retirement and Disability Pay (CRDP)?

Concurrent Retirement and Disability Pay is a Department of Defense program that restores the military retired pay a veteran would otherwise have to waive in order to collect VA disability compensation. Before January 1, 2004, retirees lost a dollar of taxable retired pay for every dollar of tax-free VA disability they received. CRDP eliminates that offset for retirees whose combined VA disability rating is 50 percent or higher, so both checks arrive in full.¹

Who Qualifies

Two thresholds control eligibility under 10 U.S.C. § 1414. You must be entitled to military retired pay, and your combined VA rating for service-connected conditions must be at least 50 percent.² Beyond that, you have to fit one of these retirement categories:

Regular retiree with 20 or more years of creditable active-duty service.
Reserve retiree with 20 qualifying years under the point system who has reached retirement eligibility age.
TERA retiree who left under the Temporary Early Retirement Authority with at least 15 years of active service.³

Reserve retirees should note that the eligibility age is not fixed at 60. Qualifying active duty performed after January 28, 2008 reduces the eligibility age by three months for each 90-day block served, with a floor of 50.⁴ If your age has been reduced and you are already drawing retired pay, CRDP can begin before 60.

Veterans paid at the 100 percent rate because of Individual Unemployability qualify on the same footing as those with a schedular 100 percent rating, as long as the service requirements are met.⁵

If the VA later drops your combined rating below 50 percent, CRDP stops immediately and the standard dollar-for-dollar waiver returns. There is no restoration available below the 50 percent line.²

The Chapter 61 Exception

Medical retirees under Chapter 61 face rules that trip up more veterans than any other part of the program. If you had 20 or more years of creditable service when you were medically retired, you qualify for CRDP, but the restoration is capped at the amount you would have earned through longevity alone. The extra retired pay tied to your military disability percentage stays subject to the VA offset.¹

If your Chapter 61 retirement came with fewer than 20 years of service, the statute excludes you from CRDP entirely.² Check your DD Form 214 or retirement orders for your creditable service years and retirement code before assuming you qualify.

How the Payment Actually Works

CRDP is not a separate check. It is an increase to your existing military retirement payment. DFAS normally reduces your retired pay by the exact amount the VA pays in disability compensation; when CRDP applies, DFAS adds that waived amount back into your retirement check.¹ The VA continues to pay your disability compensation as its own separate payment. You end up with both amounts in full.

No application is required. The VA and DFAS exchange rating data through automated matching, so most retirees are enrolled without submitting any paperwork. When your rating reaches 50 percent, DFAS audits your account and adjusts your pay.¹ The two agencies keep exchanging data going forward, so a change in your VA award triggers a recalculation of the waiver and the restoration.

Taxes

Because CRDP restores retired pay rather than creating a new benefit, it carries the same tax treatment as the rest of your retirement check. If your retired pay is taxable, your CRDP is taxable. If your retired pay is non-taxable, so is the restored portion.⁶ Your VA disability compensation stays tax-free regardless.

CRDP or CRSC

You cannot receive CRDP and Combat-Related Special Compensation at the same time. When you qualify for both, DFAS starts you on whichever program pays more in gross dollars and sends a letter giving you 45 days to switch. After that, you get one chance each year to change your election during an open season that typically runs through January.⁷

Gross dollars are not the whole story. Three differences drive the decision:

CRSC is non-taxable; CRDP is taxable. A smaller CRSC payment can leave more money in your pocket after withholding.³
CRSC requires combat-related disabilities rated at 10 percent or higher and a separate application through your branch of service. CRDP requires a 50 percent combined VA rating and no application.
CRDP restores retired pay that a state court can divide as marital property. CRSC is not subject to division with a former spouse.³

If you do nothing during open season, DFAS keeps you where you are. The election form has to be postmarked by the January deadline.⁷

Divorce and Garnishment Exposure

CRDP raises the amount of disposable retired pay a state court can divide under the Uniformed Services Former Spouses’ Protection Act. Disposable retired pay is gross retired pay minus certain authorized deductions, including amounts waived for VA disability.⁸ When CRDP shrinks or eliminates that waiver, the pool available for a former spouse grows. Electing CRSC removes that money from the divisible pool.⁹ CRDP can also be garnished for child support and alimony under the Consumer Credit Protection Act.¹⁰

Retroactive Pay

When a VA rating increase to 50 percent or higher carries a backdated effective date, DFAS owes CRDP from that date. Retroactive payments cannot reach further back than January 1, 2004, when the program took effect.¹ Your back pay actually starts on the latest of three dates: when the law took effect, when you retired, or when your rating first hit 50 percent.

DFAS starts your monthly payments before it computes the back pay. Retroactive calculations generally take 60 to 90 days after DFAS has everything it needs, and Chapter 61 cases or complex reserve retirements can run longer.¹¹

Verifying Your Pay and Fixing Problems

Three documents tell you whether CRDP is working correctly:

Your VA Rating Decision letter, available through VA.gov, shows your combined percentage and effective date.
Your DD Form 214 or retirement orders confirm your creditable service years and retirement code.
Your Retiree Account Statement from DFAS breaks down gross pay, deductions, and net pay each month.¹²

On the Retiree Account Statement, find the VA Waiver line. If you meet the 50 percent threshold and that line still shows a reduction, something is off. Compare the waiver amount to your VA disability payment to see whether CRDP is fully or only partially restoring your retired pay.

If your account has not caught up within 90 days of a rating change, or the math on your statement is wrong, contact DFAS with your VA Rating Decision letter, DD Form 214, and recent Retiree Account Statement in hand.¹³ Most discrepancies come from a data lag between the VA and DFAS, a miscoded retirement type, or an outdated rating in the system, and they resolve within a single audit cycle once DFAS has the correct records.

1
Defense Finance and Accounting Service. Concurrent Retirement and Disability Pay (CRDP)
2
Office of the Law Revision Counsel. 10 USC 1414 – Members Eligible for Retired Pay Who Are Also Eligible for Veterans Disability Compensation for Disabilities Rated 50 Percent or Higher
3
Defense Finance and Accounting Service. Comparing CRSC and CRDP
4
Office of the Law Revision Counsel. 10 USC 12731 – Age and Service Requirements
5
Defense Finance and Accounting Service. March 2025 Gray Area Disability Entitlements VA Waiver
6
Defense Finance and Accounting Service. Is It Taxable?
7
Defense Finance and Accounting Service. CRDP-CRSC FAQs
8
Office of the Law Revision Counsel. 10 USC 1408 – Payment of Retired or Retainer Pay in Compliance With Court Orders
9
Defense Finance and Accounting Service. Former Spouses Protection Act (USFSPA) Frequently Asked Questions
10
U.S. Department of Labor. Fact Sheet #30: Wage Garnishment Protections of the Consumer Credit Protection Act (CCPA)
11
Defense Finance and Accounting Service. Retired and Annuitant Pay Processing: How Long Does It Take?
12
Defense Finance and Accounting Service. Retiree Account Statement (RAS)
13
Defense Finance and Accounting Service. Customer Service