DEFENSE FINANCE AND ACCOUNTING SERVICE 

U.S. Military Retired Pay 

8899 E 56th Street 

Indianapolis, IN 46249-1200 

www.dfas.mil/retiredmilitary

Dear Retiree, 

This packet contains the form required to process a request to withdraw from the Survivor Benefit Plan 

(SBP) due to qualifying VA disability, and a fact sheet with important information on withdrawing from SBP. 

What you need to know 

 Retirees who meet one of the following two criteria are eligible to withdraw from SBP: 

A) The retiree has had a service-connected disability rated by the VA as totally disabled for a continuous 

period of 10 or more years; or 

B) The retiree has had a total disability rating from the VA for at least five continuous years immediately 

following the last date of active duty. 

 Before you request to withdraw from SBP, we recommend you read the enclosed fact sheet, speak with 

your branch of service retiree services organization or a financial advisor, and consider your decision carefully. 

In addition, you should consider your legal obligations, such as a divorce decree or court order requiring you to 

maintain SBP coverage, before making your decision. 

What you need to do 

To request to withdraw from SBP, please fill out, sign and date the SBP Withdrawal Consent Form (DFAS 

CL Form 1077). A request for withdrawal requires the written consent of the beneficiary or beneficiaries. 

Consent for a dependent child may be given by a parent, step-parent, foster parent or guardian. Please note that 

if you have former spouse coverage, special rules may apply and you should seek assistance prior to requesting 

withdrawal. 

 If you have spouse coverage, your spouse will need to sign and date the form on or after the date you 

sign. 

 If you have child coverage and any eligible child is over 18 and not incapacitated, the eligible child 

beneficiary(s) over 18 will need to sign and date the form on or after the date you sign. 

Keep a photocopy of your completed form and mail the original to the address above or fax to: 800-469-

6559. When we receive your completed form, we will review your request to withdraw and notify you with the 

results of the review. If you change your mind after sending your form, you may withdraw your request by 

notifying us in writing within 30 days of the date of your signature on the SBP Withdrawal Consent Form. 

If you have questions 

We thank you for your service to our country. If you have additional questions about SBP, please visit our 

website at: https://www.dfas.mil/providesbp 

You can also contact one of our customer care representatives at 800-321-1080 or 317-212-0551 (8:00 a.m. 

to 5:00 p.m., Eastern, Monday through Friday) or write to us at the address above. 

 Sincerely, 

 Retired and Annuitant Pay 

Enclosures: 

Survivor Benefit Plan Withdrawal Fact Sheet 

DFAS-CL Form 1077 
SURVIVOR BENEFIT PLAN WITHDRAWAL FACT SHEET 

ADVANTAGES OF PARTICIPATING IN SBP/ 

DISADVANTAGES OF WITHDRAWING FROM SBP 

 There are a limited number of circumstances in which a military retiree who has elected to participate in the 

Survivor Benefit Plan may choose to withdraw from the plan. He or she may withdraw from the plan between 

the 25th and 36th months of his or her coverage. He or she may withdraw from the plan when he or she loses 

their designated beneficiary due to death or, in some circumstances, due to divorce. Finally, he or she may 

withdraw from the plan when his or her disability rating remains at 100% for at least 10 years (or 5 years from 

the date of retirement). 

 This fact sheet is intended to inform military retirees with 100% disabililty ratings regarding plan provisions 

and other considerations affecting a decision to withdraw from the Survivor Benefit Plan. 

 However, before you begin this decision process, you should consider carefully whether any personal legal 

obligations, such as a court order or divorce decree requiring you to maintain SBP coverage, limit your ability to 

withdraw from the plan. 

 In the event that there are no personal legal obligations limiting your ability to withdraw from the plan, there 

are three reasons a retiree rated 100% disabled might think withdrawing from SBP could be in his or her 

interest. These reasons are: 

I. Because benefit payments to his or her spouse under the Survivor Benefit Plan were previously offset by 

the amount of the benefits paid to his or her surviving spouse under the VA DIC program; 

II. To recover premiums previously paid for SBP coverage in order to address a pressing financial need; 

and 

III. To increase his or her monthly take home retirement pay by eliminating SBP premium deductions. 

 We will discuss some of the factors affecting each of those situations below. In addition, we will cover a few 

additional considerations and the steps you would need to take to withdraw. 

 If, once you have read this fact sheet, you would like further assistance in making your decision about 

withdrawing, please contact your branch of service retiree services organization.

I. WITHDRAWAL BECAUSE OF THE SURVIVOR BENEFIT PLAN (SBP) DIC OFFET 

 Historically, withdrawing from the Survivor Benefit Plan because of the DIC offset made some sense for 

retirees once their disability rating rose to 100%. However, the tradeoffs involved changed significantly when 

Public Law 116-92, the National Defense Authorization Act (NDAA) for Fiscal Year 2020 was passed, creating 

a phased elimination of the offset to the Survivor Benefit Plan due to receipt of DIC. 

 Now, beginning in 2023, surviving spouses are able to receive the full SBP annuity without any offset due to 

receipt of DIC. 

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SURVIVOR BENEFIT PLAN WITHDRAWAL FACT SHEET 

Page - 2 

Dependency and Indemnity Compensation (DIC) 

 Dependency and Indemnity Compensation (DIC) is a tax-free, monetary benefit paid by the VA under 38 

U.S.C. § 1311(a) to eligible survivors of military service members who die in the line of duty or eligible 

survivors of veterans whose death resulted from a service-related injury or disease. The benefit is paid monthly. 

The DIC benefit may be increased by cost-of-living adjustments (COLAs) after the member’s death. 

Survivor Benefit Plan (SBP) 

 SBP provides up to 55 percent of a service member's retired pay as an annuity to an eligible beneficiary upon 

the death of the member. The amount of the SBP annuity is a percentage of retired pay. The percentage depends 

upon whether the member chooses full or reduced coverage at the time of election (generally at retirement or at 

20-year qualification). The annuity is paid monthly. The SBP annuity may be increased by cost-of-living 

adjustments (COLAs) after the member’s death. 

 Withdrawal from SBP will result in no SBP annuity monthly payments after the member’s death, even if 

there is no DIC benefit. 

Spouse SBP Coverage 

 The amount of the SBP annuity and the DIC benefit that would be paid to a surviving spouse should be 

carefully considered before requesting withdrawal. 

How Remarriage May Impact a Spouse SBP Annuity 

Remarriage before age 55 

 Spouses maintain their eligibility for an SBP annuity until death, as long as they do not remarry before the 

age of 55. If the annuitant remarries before age 55, annuity payments will stop. Eligibility for DIC payments 

would also end. However, if the annuitant's marriage later ends for any reason, even after age 55, the annuity 

payment will restart from the date the marriage ends, once DFAS is notified. 

II. WITHDRAWAL TO RECOVER PREVIOUSLY PAID PREMIUMS 

 If SBP coverage is withdrawn due to disability, a refund of previously paid premiums is not immediately 

given. The reason for this is a withdrawal from the Plan remains in effect as long as you are rated as totally 

disabled. If your rating is reduced, the coverage can be reinstated by you only if you request it within one year 

of the effective date of the reduction of VA disability rating to less than 100% (total). If you do not request the 

coverage to be reinstated, or if your disability rating is never decreased, then the surviving spouse will be 

entitled to a refund of spouse premiums paid at the time of the member’s death and they will not be entitled to a 

monthly annuity payment under SBP. 

III. WITHDRAWAL TO ELIMINATE ONGOING SURVIVOR BENEFIT PLAN PREMIUMS 

 If you withdraw from the plan, your premium deduction will in fact stop. However, you will irrevocably lose 

a monthly annuity payment for your spouse or children that is inflation-protected, and for eligible spouses is a 

benefit that would be paid for the rest of their life. You should carefully consider your total estate planning to 

ensure that your family will have adequate financial protection in the future. For this reason, an election to 

withdraw requires consent from all beneficiaries. 

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SURVIVOR BENEFIT PLAN WITHDRAWAL FACT SHEET 

Page – 3 

IV. ADDITIONAL CONSIDERATIONS 

Spouse and Child SBP Coverage 

 With SBP Spouse and Child coverage, the annuity is payable first to the surviving spouse. If the surviving 

spouse dies or otherwise becomes ineligible for the annuity (such as when the spouse remarries before age 55), 

eligible children equally divide the monthly annuity. 

 A child is generally eligible for the SBP annuity through age 18, if unmarried; or through age 22 if unmarried 

and attending school full-time. Incapacitated or disabled children are eligible under special rules. 

 A child’s annuity is not reduced by any DIC benefit that may be awarded to the child. 

Child Only Coverage 

 The cost for child only coverage is, in most cases, a minimal amount. 

 The child may be awarded a DIC benefit in his or her own right and, as stated above, the payments are not 

reduced by the amount of the DIC. 

 It is especially important to consider continued participation in the Plan when spouse and child or child only 

coverage includes an incapacitated child. 

V. SUBMITTING YOUR REQUEST TO WITHDRAW 

 To withdraw, please see the instructions in the cover letter to this packet and on the form. A request for 

withdrawal requires the written consent of the beneficiary or beneficiaries. 

 If you change your mind after you have submitted your SBP Withdrawal Consent Form, you may withdraw 

the request by notifying us in writing within 30 days of the date of your signature on the SBP Withdrawal 

Consent Form. 

IMPORTANT NOTE: Withdrawal from the Plan remains in effect as long as you are rated as totally disabled. 

If your rating is reduced, the coverage will be reinstated only if you request it within one year of the effective 

date of the reduction of VA disability rating to less than 100% (total). 

DFAS-CL 1741/115A