PROCEEDINGS

	IN THE CASE OF:  

	BOARD DATE:           3 April 2001                   
	DOCKET NUMBER:   AR2000048160

	I certify that hereinafter is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in the case of the above-named individual.  

	Mr. Carl W. S. Chun		Director	
	Mrs. Nancy Amos		Analyst	

  The following members, a quorum, were present:

	Mr. Walter T. Morrison		Chairperson	
	Mr. Thomas F. Baxter		Member	
	Mr. John T. Meixell		Member	

	The applicant and counsel if any, did not appear before the Board.

	The Board considered the following evidence:

	Exhibit A - Application for correction of military 
                records
	Exhibit B - Military Personnel Records (including
	            advisory opinion, if any)

FINDINGS:

1.  The applicant has exhausted or the Board has waived the requirement for exhaustion of all administrative remedies afforded by existing law or regulations.

2.  The applicant requests that his records be corrected to show that he did not enroll in the Survivor Benefit Plan (SBP) and that Federal withholding from his retired pay be stopped.

3.  The applicant states that he did not understand what he was signing up for.  He thought he was continuing his military life insurance.  He was not aware that his retired pay was not taxable at the Federal level so he did not question that deduction either.  Since he is still looking for a job, these deductions are a financial hardship.  The applicant’s spouse concurs in his request to terminate the SBP.  

4.  The applicant’s military records are not available.  The information contained herein was obtained from alternate sources.

5.  On 1 June 2000, the applicant completed a Data for Payment of Retired Personnel form, DD Form 2656.  He elected to participate in the SBP for spouse coverage, full base amount.  Because he elected full spouse coverage, his spouse did not need to concur in his election and apparently she did not receive the SBP briefing.

6.  On 1 August 2000, the applicant retired.  On or about 1 September 2000, he received his initial Retiree Account Statement.  It showed an SBP deduction of $76.12 and a Federal income tax withheld (FITW) amount of $48.53.  On          15 September 2000, the applicant, with his spouse’s concurrence, applied to the Board for termination of the SBP.  On 19 September 2000, the applicant and his spouse “adjusted” their copy of the DD Form 2656 to show that he declined to participate in the SBP and that his spouse concurred in his decision.

7.  On 22 December 2000, the applicant was informed that retired pay is taxable by the Federal government and even if the Board took favorable action on his case the FITW deduction would still be taken out.  He indicated that he still wanted the SBP terminated.

8.  Public Law 92-245, the SBP, enacted 21 September 1972, provided that military members on active duty could elect to have their retired pay reduced to provide for an annuity after death to surviving dependents.  An election, once made, is irrevocable except under certain circumstances prescribed by law.

CONCLUSIONS:

1.  The Board concludes that there is no evidence of Government error or injustice in this case.  The Board believes that the SBP counselor properly briefed the applicant concerning the SBP; however, the Board also believes that the applicant did not understand the substance of the briefing or its financial implications.  Both he and his spouse took immediate steps after he received his first Retiree Account Statement to change his election and the Board concludes that it would therefore be appropriate to correct his records to show that he did not enroll in the SBP.

2.  The Board does not understand where the applicant got the impression that retired pay is not taxable by the Federal government unless he is confusing military retired pay (which is taxable) with VA disability compensation (which is not taxable).  Therefore, the Board will make no recommendation concerning his FITW deduction.

3.  In view of the foregoing, the applicant’s records should be corrected as recommended below.

RECOMMENDATION:

1.  That all of the Department of the Army records related to this case be corrected by showing that the applicant completed his DD Form 2656 on 1 June 2000 and declined, with his spouse’s concurrence, to enroll in the SBP.

2.  That so much of the application as is in excess of the foregoing be denied.

BOARD VOTE:  

__wtm___  __tfb___  __jtm___  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

			Walter T. Morrison
		______________________
		        CHAIRPERSON

INDEX

CASE ID	AR2000048160	
SUFFIX		
RECON		
DATE BOARDED	20010403	
TYPE OF DISCHARGE		
DATE OF DISCHARGE		
DISCHARGE AUTHORITY		
DISCHARGE REASON		
BOARD DECISION	(GRANT)	
REVIEW AUTHORITY		
ISSUES         1.	137.03	
2.		
3.		
4.		
5.		
6.