10 U.S.C. § 1415 — Lump sum payment of certain retired pay

Page 1336 TITLE 10—ARMED FORCES § 1415 EFFECTIVE DATE OF 2003 AMENDMENT Pub. L. 108–136, div. A, title VI, § 641(e), Nov. 24, 2003, 117 Stat. 1516, provided that: ‘‘The amendments made by subsections (a) and (b) [amending this section and repealing section 1413 of this title] shall take effect on January 1, 2004, and shall apply to payments for months beginning on or after that date.’’ PROHIBITION OF RETROACTIVE BENEFITS Pub. L. 107–107, div. A, title VI, § 641(d), Dec. 28, 2001, 115 Stat. 1150, provided that: ‘‘If the provisions of sub- section (a) of section 1414 of title 10, United States Code, becomes [sic] effective in accordance with sub- section (f) of that section, no benefit may be paid to any person by reason of those provisions for any period before the effective date specified in subsection (e) of that section.’’ § 1415. Lump sum payment of certain retired pay (a) DEFINITIONS.—In this section: (1) COVERED RETIRED PAY.—The term ‘‘cov- ered retired pay’’ means retired pay under— (A) this title; (B) title 14; (C) the National Oceanic and Atmospheric Administration Commissioned Officer Corps Act of 2002 (33 U.S.C. 3001 et seq.); or (D) the Public Health Service Act (42 U.S.C. 201 et seq.). (2) ELIGIBLE PERSON.—The term ‘‘eligible person’’ means a person who— (A)(i) first becomes a member of a uni- formed service on or after January 1, 2018; or (ii) makes the election described in section 1409(b)(4)(B) or 12739(f)(2) of this title; and (B) does not retire or separate under chap- ter 61 of this title. (3) RETIREMENT AGE.—The term ‘‘retirement age’’ has the meaning given the term in sec- tion 216(l) of the Social Security Act (42 U.S.C. 416(l)). (b) ELECTION OF LUMP SUM PAYMENT OF CER- TAIN RETIRED PAY.— (1) IN GENERAL.—An eligible person entitled to covered retired pay (including an eligible person who is entitled to such pay by reason of an election described in subsection (a)(2)(A)(ii)) may elect to receive— (A) a lump sum payment of the discounted present value at the time of the election of an amount of the covered retired pay that the eligible person is otherwise entitled to receive for the period beginning on the date of retirement and ending on the date the eli- gible person attains the eligible person’s re- tirement age equal to— (i) 50 percent of the amount of such cov- ered retired pay during such period; or (ii) 25 percent of the amount of such cov- ered retired pay during such period; and (B) a monthly amount during the period described in subparagraph (A) equal to— (i) in the case of an eligible person elect- ing to receive an amount described in sub- paragraph (A)(i), 50 percent of the amount of monthly covered retired pay the eligible person is otherwise entitled to receive dur- ing such period; and (ii) in the case of an eligible person electing to receive an amount described in subparagraph (A)(ii), 75 percent of the amount of monthly covered retired pay the eligible person is otherwise entitled to re- ceive during such period. (2) DISCOUNTED PRESENT VALUE.—The Sec- retary of Defense shall compute the dis- counted present value of amounts of covered retired pay that an eligible person is otherwise entitled to receive for a period for purposes of paragraph (1)(A) by— (A) estimating the aggregate amount of re- tired pay the person would receive for the period, taking into account cost-of-living ad- justments under section 1401a of this title projected by the Secretary at the time the person separates from service and would oth- erwise begin receiving covered retired pay; and (B) reducing the aggregate amount esti- mated pursuant to subparagraph (A) by an appropriate percentage determined by the Secretary— (i) using average personal discount rates (as defined and calculated by the Sec- retary taking into consideration applica- ble and reputable studies of personal dis- count rates for military personnel and past actuarial experience in the calculation of personal discount rates under this para- graph); and (ii) in accordance with generally accept- ed actuarial principles and practices. (3) TIMING OF ELECTION.—An eligible person shall make the election under this subsection not later than 90 days before the date of the retirement of the eligible person from the uni- formed services. (4) SINGLE PAYMENT OR COMBINATION OF PAY- MENTS.—An eligible person may elect to re- ceive a lump sum payment under this sub- section in a single payment or in a combina- tion of payments. (5) COMMENCEMENT OF PAYMENT.—An eligible person who makes an election under this sub- section shall receive the lump sum payment, or the first installment of a combination of payments of the lump sum payment if elected under paragraph (4), as follows: (A) Not later than 60 days after the date of the retirement of the eligible person from the uniformed services. (B) In the case of an eligible person who is a member of a reserve component, not later than 60 days after the earlier of— (i) the date on which the eligible person attains 60 years of age; or (ii) the date on which the eligible person first becomes entitled to covered retired pay. (6) NO SUBSEQUENT ADJUSTMENT.—An eligible person who accepts payment of a lump sum under this subsection may not seek the review of or otherwise challenge the amount of the lump sum in light of any variation in cost-of- living adjustments under section 1401a of this title, actuarial assumptions, or other factors used by the Secretary in calculating the amount of the lump sum that occur after the Secretary pays the lump sum. (c) RESUMPTION OF MONTHLY ANNUITY.— Page 1337 TITLE 10—ARMED FORCES § 1431 (1) GENERAL RULE.—Subject to paragraph (2), an eligible person who makes an election de- scribed in subsection (b)(1) shall be entitled to receive the eligible person’s monthly covered retired pay calculated in accordance with paragraph (2) after the eligible person attains the eligible person’s retirement age. (2) RESTORATION OF FULL RETIREMENT AMOUNT AT RETIREMENT AGE.—The retired pay of an eligible person who makes an election described in subsection (a) shall be recom- puted, effective on the first day of the first month beginning after the person attains the eligible person’s retirement age, so as to be an amount equal to the amount of covered retired pay to which the eligible person would other- wise be entitled on that date if the annual in- creases, in the retired pay of the eligible per- son made to reflect changes in the Consumer Price Index, had been made in accordance with section 1401a of this title. (d) PAYMENT OF RETIRED PAY TO PERSONS NOT MAKING ELECTION.—An eligible person who does not make the election described in subsection (b)(1) shall be paid the retired pay to which the eligible person is otherwise entitled under the applicable provisions of law referred to in sub- section (a)(1). (e) REGULATIONS.—The Secretary of Defense shall prescribe regulations to carry out the pro- visions of this section. (Added Pub. L. 114–92, div. A, title VI, § 633(a)(1), Nov. 25, 2015, 129 Stat. 847; amended Pub. L. 114–328, div. A, title X, § 1081(a)(4), Dec. 23, 2016, 130 Stat. 2417; Pub. L. 115–232, div. A, title X, § 1081(a)(14), Aug. 13, 2018, 132 Stat. 1984.) Editorial Notes REFERENCES IN TEXT The National Oceanic and Atmospheric Administra- tion Commissioned Officer Corps Act of 2002, referred to in subsec. (a)(1)(C), is title II of Pub. L. 107–372, Dec. 19, 2002, 116 Stat. 3082, which is classified principally to chapter 43 (§ 3001 et seq.) of Title 33, Navigation and Navigable Waters. For complete classification of this Act to the Code, see Short Title note set out under sec- tion 3001 of Title 33 and Tables. The Public Health Service Act, referred to in subsec. (a)(1)(D), is act July 1, 1944, ch. 373, 58 Stat. 682, which is classified generally to chapter 6A (§ 201 et seq.) of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under section 201 of Title 42 and Tables. AMENDMENTS 2018—Subsec. (e). Pub. L. 115–232 struck out ‘‘con- cerned’’ after ‘‘The Secretary of Defense’’. 2016—Subsec. (b)(1)(B)(ii). Pub. L. 114–328 inserted pe- riod at end. Statutory Notes and Related Subsidiaries EFFECTIVE DATE; IMPLEMENTATION Section effective Jan. 1, 2018, with certain implemen- tation requirements, see section 635 of Pub. L. 114–92, set out as an Effective Date of 2015 Amendment; Imple- mentation note under section 8432 of Title 5, Govern- ment Organization and Employees. CHAPTER 73—ANNUITIES BASED ON RETIRED OR RETAINER PAY Subchapter Sec. I. Retired Serviceman’s Family Protec- tion Plan ............................................ 1431 Subchapter Sec. II. Survivor Benefit Plan ............................ 1447 [III. Repealed] Editorial Notes AMENDMENTS 2004—Pub. L. 108–375, div. A, title VI, § 644(b)(2), Oct. 28, 2004, 118 Stat. 1961, struck out item for subchapter III ‘‘Supplemental Survivor Benefit Plan’’, effective Apr. 1, 2008. 1990—Pub. L. 101–510, div. A, title VI, § 631(1), title XIV, § 1484(l)(4)(A), Nov. 5, 1990, 104 Stat. 1580, 1719, amended Pub. L. 101–189, § 1404(a)(2), see 1989 Amend- ment note below. 1989—Pub. L. 101–189, div. A, title XIV, § 1404(a)(2), Nov. 29, 1989, 103 Stat. 1586, as amended by Pub. L. 101–510, div. A, title VI, § 631(1), title XIV, § 1484(l)(4)(A), Nov. 5, 1990, 104 Stat. 1580, 1719, added item for sub- chapter III, effective Apr. 1, 1992. 1980—Pub. L. 96–513, title V, § 511(54)(A), Dec. 12, 1980, 94 Stat. 2925, amended chapter heading to read: ‘‘ANNU- ITIES BASED ON RETIRED OR RETAINER PAY’’. 1972—Pub. L. 92–425, § 1(1), Sept. 21, 1972, 86 Stat. 706, added subchapter analysis and amended chapter head- ing by inserting ‘‘; SURVIVOR BENEFIT PLAN’’ after ‘‘PAY’’ which could not be executed as directed in view of amendment by Pub. L. 87–381. 1961—Pub. L. 87–381, § 1(1), Oct. 4, 1961, 75 Stat. 810, substituted ‘‘RETIRED SERVICEMAN’S FAMILY PROTECTION PLAN’’ for ‘‘ANNUITIES BASED ON RETIRED OR RETAINER PAY’’ in chapter heading. SUBCHAPTER I—RETIRED SERVICEMAN’S FAMILY PROTECTION PLAN Sec. 1431. Election of annuity: members of armed forces. 1432. Election of annuity: former members of armed forces. 1433. Mental incompetency of member. 1434. Kinds of annuities that may be elected. 1435. Eligible beneficiaries. 1436. Computation of reduction in retired pay; withdrawal for severe financial hardship. 1436a. Coverage paid up at 30 years and age 70. 1437. Payment of annuity. 1438. Deposits for amounts not deducted. 1439. Refund of amounts deducted from retired pay. 1440. Annuities not subject to legal process. 1441. Annuities in addition to other payments. 1442. Recovery of annuity erroneously paid. [1443. Repealed.] 1444. Regulations; determinations. 1444a. Regulations regarding payment of annuity to a representative payee. 1445. Correction of administrative deficiencies. 1446. Restriction on participation. Editorial Notes AMENDMENTS 1999—Pub. L. 106–65, div. A, title VI, § 655(b), Oct. 5, 1999, 113 Stat. 667, added item 1436a. 1991—Pub. L. 102–190, div. A, title VI, § 654(b)(2), Dec. 5, 1991, 105 Stat. 1390, added item 1444a. 1972—Pub. L. 92–425, § 1(2)(B), (C), Sept. 21, 1972, 86 Stat. 706, struck out item 1443 ‘‘Board of Actuaries’’, and struck out ‘‘reports to Congress’’ from item 1444. 1961—Pub. L. 87–381, § 6(2), (3), Oct. 4, 1961, 75 Stat. 812, inserted ‘‘; withdrawal for severe financial hardship’’ in item 1436, and added items 1445 and 1446. § 1431. Election of annuity: members of armed forces (a) This section applies to all members of the armed forces except—