Military and Federal Pensions in an Alabama Divorce: USFSPA, the 10/10 Rule and Survivor Benefits

By the FigureMyTax Editorial Team · How we calculate

Alabama counts military retirement earned during the marriage in the marital estate. Federal law caps all court-ordered payments at 50 percent of disposable retired pay, and the military pays directly only after a 10-year marriage and service overlap.

Is military retirement divided in an Alabama divorce?

Yes. Alabama includes retirement benefits from military employment in the marital estate, unless the parties agree otherwise (Ala. Code 30-2-51(b)(1)). Federal law lets a court treat disposable retired pay as property of the member alone or of the member and spouse under the law of the court’s jurisdiction, but only if the court has jurisdiction over the member through residence other than because of military assignment, domicile or consent (10 U.S.C. 1408(c)).

What is the 50% federal limit?

The total amount of disposable retired pay payable under all court orders may not exceed 50 percent of the disposable retired pay (10 U.S.C. 1408(e)(1)). Alabama’s own 50% ceiling on the noncovered spouse’s total (30-2-51(b)(2)) points the same way, but the two rules are separate.

What is the 10/10 rule?

Direct payment from the military to a former spouse is not available, to the extent the order treats retired pay as property, unless the spouses were married for 10 years or more during which the member performed at least 10 years of service creditable for retired pay (1408(d)(2)). The rule limits payments made by the military under section 1408; it does not by itself say a court cannot divide the pay, so an order should say how a spouse who misses the test will be paid. The Alabama pension division calculator checks your overlap months.

How does a military order get paid?

After effective service on the Secretary concerned of a court order that specifically provides for payment of a share of disposable retired pay to a spouse or former spouse, the Secretary makes payments, subject to the section’s limits (1408(d)(1)). The order must say what amount or fraction is paid, so a general property award is not enough.

What about federal civilian pensions?

Federal law provides that payments under the Civil Service Retirement System and the Federal Employees Retirement System are paid, in whole or in part, to another person to the extent expressly provided in the terms of a court decree of divorce, annulment or legal separation or a court order or court-approved property settlement incident to one (5 U.S.C. 8345(j); 5 U.S.C. 8467). Alabama’s marital estate includes public employment retirement benefits.

Do Alabama state and local plans work differently?

They follow their own statutes. Benefits under the Employees’ and Teachers’ Retirement Systems are exempt from levy and unassignable except as provided, and a court may not enlarge the benefits a plan pays (30-2-51(e)).

What does this page not cover?

Survivor benefits for a former spouse and tax treatment are separate questions governed by federal law and the plan, and we did not read the survivor-benefit rules for this page. Ask the plan or a licensed attorney. Also see the Alabama property division calculator for the rest of the estate.

Frequently asked questions

Official sources

• Ala. Code 30-2-51: allowance on divorce; retirement benefits
• Ala. Code 30-2-40: legal separation
• Kleinatland v. Kleinatland, Alabama Court of Civil Appeals
• 10 U.S.C. 1408: military retired pay in divorce
• 26 U.S.C. 414(p): qualified domestic relations orders
• 29 U.S.C. 1056(d)(3): ERISA domestic relations orders
• 5 U.S.C. 8345(j): CSRS court orders
• 5 U.S.C. 8467: FERS court orders

This is general information, not legal advice. It is based on the cited Alabama statutes, rules and court opinions, and every case turns on its own facts. Confirm how the law applies to your situation with a licensed Alabama attorney.