Collins wants to eliminate tax inequity for surviving spouses of military members killed in action

U.S. Sen. Susan Collins (R-ME) on Tuesday advocated for U.S. Senate approval of the bipartisan Military Widow’s Tax Elimination Act of 2019 during a press conference at the U.S. Capitol.

“We seek to correct an inequity in our law that has existed for many years,” Sen. Collins said during the May 21 press conference that included several colleagues, as well as surviving military spouses and military family advocates.

Sen. Collins is an original cosponsor of S. 622, introduced in February by U.S. Sen. Doug Jones (D-AL) to repeal federal law that prevents up to 65,000 surviving military spouses from receiving their full Department of Defense and Veterans Affairs (VA) survivor benefits. The bill currently has 69 cosponsors.

The related bill in the U.S. House of Representatives, the Military Surviving Spouses Equity Act, H.R. 553, currently has 316 cosponsors.

According to information provided by Sen. Collins’ office, the surviving spouse of a retired member who dies of a service-connected cause or a service member killed in active duty is entitled to benefits from the VA’s Dependency and Indemnity Compensation (DIC) program.

If a military retiree also was enrolled in the Survivors Benefits Plan (SBP), then the surviving spouse’s SBP benefits are reduced by the DIC amount. While each case varies depending on rank and the year of a service-related death, the average DIC offset to SBP pay is $925 per month, the senator’s staff explained in a March statement after the bill was introduced.

Sen. Collins pointed out that in some cases, this leads to a “total elimination” of the annuity’s benefit and in other cases, it greatly reduces it. “In either case, it is out-and-out unfair,” she said.

S. 622 would repeal the required offset and authorize payment of both SBP and DIC in the case of a service-connected death.

“It makes absolutely no sense that there is an offset that applies to military families’ survivor benefits when service members used their own funds to purchase this extra insurance,” said Sen. Collins. “That is the inequity that we are trying to correct.”