Divorce is an emotionally and legally challenging endeavor, but it becomes especially complex when one or both spouses are active or former members of the military with significant military benefits. Determining how to divide assets and debts in a Colorado divorce is often the most contentious aspect of the case. Under Colorado’s divorce law, spouses must divide their assets in a way that is fair and equitable. However, military divorces in Denver are subject to different guidelines and requirements under federal law.
What Military Benefits are Subject to Division During Divorce?
Serving in the military entails substantial personal sacrifice and risk, but it also confers significant benefits. Marriage is a partnership, and military spouses share in the personal sacrifice. Still, many service members are surprised to learn that their military retirement plan is a marital asset. Like other assets, military benefits may be considered marital property and subject to division during a divorce. Common military benefits considered during divorce include the following:
- Military retirement pension
- Thrift Savings Plan (TSP) funds (similar to the civilian’s 401(k) plan)
- Survivor Benefit Plan (SBP), which provides a continued income to a beneficiary after the military member’s death
Tricare is the military’s health insurance benefit. A non-military spouse may be able to keep access to some of their Tricare benefits, depending on the duration of the marriage and the length of their spouse’s military service.
What are the 10/10 and 20-20-20 Rules for Military Divorce in Colorado?
Under the 10/10 rule established by federal law, a spouse has the right to claim a portion of the military spouse’s retirement benefits if they’ve been married for at least 10 years, and the military member has 10 or more years of active-duty service that overlaps with the duration of the marriage. The Defense Finance and Accounting Service makes payments directly to the spouse awarded a portion of the retirement plan rather than requiring the military member to write monthly checks or arrange payments.
Under the 20-20-20 rule for military divorce in Colorado, a non-military spouse retains access to Tricare medical coverage, full retirement benefits, and other benefits, such as access to the commissary, as long as the marriage lasted at least 20 years and overlaps with their spouse’s 20 years or more of service.
What Is the Frozen Benefit Rule In a Colorado Military Divorce?
Once the court issues the final dissolution of marriage (divorce decree), the non-military spouse’s share of the military retirement benefits freezes. Under this rule, even if the military member increases their retirement plan through promotions or by remaining on active duty for an extended period, the spouse cannot claim a portion of the increased retirement benefit. Instead, their portion is “frozen” at the rate during the time the Denver divorce was finalized.
Distributing Military Benefits After a Colorado Military Divorce
There are several options for the division of military benefits, such as a retirement pension plan. The Defense Finance and Accounting Service may pay the spouse’s share of the benefit to them monthly after they reach retirement, or the court could award a lump-sum payment at the net present value (NPV).