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Saturday 12 February 2011

Lingering Military "Widows' Tax" Angers Wives - To collect on insurance husbands bought, they must marry another man -

Lingering Military "Widows' Tax" Angers Wives - To collect on insurance husbands bought, they must marry another man -


Tens of thousands of the nation's war widows find it perplexing and downright disrespectful to their late military husbands: In order to fully collect on insurance their husbands bought for them when alive, they must marry another man.
And to qualify, the widows must remarry when they are 57 or older. Those who remarry earlier miss out, as do widows who never remarry.
At the heart of the issue is a government policy known as the "widows' tax." It says a military spouse whose loved one dies from a service-related cause can't collect both survivor's benefits and the full annuity benefits from insurance the couple bought from the Defense Department at retirement. Instead, the amount of the annuity payment is reduced by the amount of the monthly survivor benefit.
Time after time, members of Congress have promised to help the 55,000 affected widows, but laws passed to help them have only created a more complicated system that's left many of them confused and angry.
So what's remarriage got to do with it? Very little, as it turns out. The marriage condition was stuck into the law by Congress as it attempted to help the survivors retain certain benefits if they remarried late in life, as is the case with other similar federal annuities. Because Congress hasn't been able to come up with the money to help all the widows, relief has been limited to that group. The result is an all but incomprehensible mess.

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