NDAA-'17 Court Order Requirements

Defense Finance
and Accounting Service
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NOTICE OF STATUTORY CHANGE

A change to the law has occurred that affects the manner in which court orders submitted to the Defense Finance and Accounting Service (DFAS) as part of an application for division of military retired pay pursuant to the Uniformed Services Former Spouses’ Protection Act (USFSPA) must be formatted.  The following information provides notification of these statutory changes:

The National Defense Authorization Act (NDAA) of 2017, in Section 641, signed by the President on December 23, 2016, and revised in Section 624 of the NDAA of 2018, amended the definition of disposable pay in the Uniformed Services Former Spouses’ Protection Act (USFSPA), 10 U.S.C. § 1408-- In the case of a division of military retired pay as property (that becomes final prior to the date of a member’s retirement),  the military member’s disposable income is limited to "the amount of retired pay to which the member would have been entitled using the member's retired pay base and years of service on the date of the decree of divorce, dissolution, annulment, or legal separation" and increased by the cost-of-living amounts granted to military retirees from the time of the (divorce) to the date the member retires.

In order to enable the designated agent (the Defense Finance and Accounting Service (DFAS), Garnishment Law Directorate) to calculate the “new” disposable retired pay amount, a court order entered after December 23, 2016, (in a case where the order becomes final prior to the member’s retirement) that provides for a division of military retirement pay must provide the below listed three (3) variables.

If the member entered the service before September 8, 1980:

  1. A fixed amount, a percentage, a formula, or a hypothetical that the former spouse is awarded;
  2. The member’s pay grade at the time of divorce;
  3. The member’s years of creditable service at the time of divorce; and in the case of a reservist, the member’s creditable reserve points at the time of divorce.

If the member entered military service on or after September 8, 1980:

  1.  A fixed amount, a percentage, a formula or a hypothetical that the former spouse is awarded;
  2. The member’s high-3 amount at the time of divorce (the actual dollar figure);
  3. The member’s years of creditable service at the time of divorce; or in the case of reservist, the member’s creditable reserve points at the time of divorce.

If the award language in the court order is missing any of the above listed variables, we will not be able to approve the order and the court will have to clarify the award.  For additional information please see our web page at https://www.dfas.mil/garnishment/usfspa/legal.html .

For Sample language, please see "Sample Order Language" document.

Page updated June 21, 2018