--- title: "Part VI, Subpart ii, Chapter 4, Section B Preparing and Adjusting Awards in Military Retired Pay (MRP) Cases" document: "M-21-1" section: "Part VI, Subpart ii, Chapter 4, Section B" canonical: "https://veteranai.co/va-regulations/m21-1/vi.ii.4.b-preparing-and-adjusting-awards-in-military-retired-pay-mrp" source: "https://www.knowva.ebenefits.va.gov/system/templates/selfservice/va_ssnew/help/customer/locale/en-US/portal/554400000001018/content/554400000179488/M21-1-Part-VI-Subpart-ii-Chapter-4-Section-B-Preparing-and-Adjusting-Awards-in-Military-Retired-Pay-MRP-Cases" updated: "2026-09-06T14:37:00.524812Z" --- | ** **| June 5, 2025 ### VI.ii.4.B.1.a. Identifying an Award Requiring a Waiver of MRP The retired pay indicator in the corporate record identifies a compensation or Section 306 Pension award of a Veteran who * must waive military retired pay (MRP) in order to receive compensation or pension, or * has waived MRP for the purpose of computation of civil service annuity, which is payable concurrently with Department of Veterans Affairs (VA) benefits. **Important:** * Do **_not_** activate the retired pay indicator for a Veteran in receipt of current-law pension, per [M21-1, Part VI, Subpart ii, 4.A.4.a](). * When MRP has been waived for civil service annuity, MRP changes will continue to populate in the Veterans Information Solution (VIS) and the Beneficiary Identification and Records Locator Subsystem (BIRLS). However, do _**not**_ withhold compensation for MRP after the date shown in VIS that MRP stopped. **References:** For more information on * elections and waivers in MRP cases, see [M21-1, Part VI, Subpart ii, 4.A]() * activating the retired pay indicator in the corporate record, see M21-1, Part VI, Subpart ii, 4.B.1.c, and * using VIS, see the[ _VIS User Guide_](). ### VI.ii.4.B.1.b. Confirming the Retired Pay Indicator Is Active When processing an award to a Veteran whose service department awarded or will award MRP, confirm that the retired pay indicator is active by selecting the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen in the award-processing system. * If data regarding the Veteran’s MRP is displayed on the RETIRED PAY tab, and at least one entry under the RETIRED PAY TYPE field is _**other than**_ DMDC, the retired pay indicator is _active_. * If **_no_** MRP data is displayed on the RETIRED PAY tab, activate the indicator by following the instructions in M21-1, Part VI, Subpart ii, 4.B.1.c. _**Note**_ : Once the retired pay indicator is activated, a banner reflecting receipt of retired pay will be displayed in the Veterans Benefits Management System – Awards (VBMS-A).**Reference:** For information on using VBMS-A, see the _VBMS Awards User Guide_. ### VI.ii.4.B.1.c. Instructions for Activating the Retired Pay Indicator in the Corporate Record Follow the instructions in the table below to activate the retired pay indicator in the corporate record.**Important:** Activate the retired pay indicator even if VA is not withholding or will not withhold benefits based on the Veteran’s receipt of MRP.| **Step**| **Action** 1| Select the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen in VBMS-A.**Important:** Do _not_ delete any historical information displayed on the RETIRED PAY tab unless it is inaccurate. 2| Click on the ADD button and manually enter the MRP data or click on the RETRIEVE BIRLS DATA button, which will automatically populate the fields on the tab with data pulled from BIRLS.**Note:** When the RETRIEVE BIRLS DATA button is utilized, it automatically populates the * EFFECTIVE DATE field with the first day of the month which must be edited to reflect the date MRP began when it is other than the first of the month (such as disability retirement or reaching retirement age for Veterans who retired from a Reserve component), and * RETIRED PAY TYPE field with an entry of _DMDC_. At least one entry must be edited to reflect the appropriate retired pay type (e.g. _Regular Retired Pay_). Follow the instructions in the table below when a manual entry is required for any field on the RETIRED PAY tab.| **Field**| **Instructions** RETIRED PAY TYPE| A variety of sources/means exist for determining the proper entry. They include: * the Veteran’s _DD Form 214_ ,_Certificate of Uniformed Service_ * VIS * the Defense Personnel Records Information Retrieval System (DPRIS) * the entry in the FAN CD (functional account number code) field on the ENTIT and MBRENT screens in the Defense Finance and Accounting Service (DFAS) Retired and Casualty Pay Subsystem (RCPS) (Army, Navy, Air Force, Space Force, and Marine Corps only) * telephone contact with DFAS (Army, Navy, Air Force, Space Force, and Marine Corps only) at 866-622-4602, and/or * telephone contact with the Coast Guard Retiree and Annuitant Services Branch (CGRASB) (for all uniformed services **_other than_** the Army, Navy, Air Force, Space Force, and Marine Corps) at 866-772-8724. GROSS AMOUNT| If the Veteran’s service department has not yet determined the amount of MRP, * leave the GROSS AMOUNT field blank, and * follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3. **Important:** Do **_not_** enter _0.00_ , as doing so _deactivates_ the retired pay indicator. EFFECTIVE DATE| Enter the date of entitlement to disability compensation (**_not_** the payment date) in the EFFECTIVE DATE field. _**References**_ : For more information on * updating the RETIRED PAY tab in VBMS-A, see the _VBMS Awards User Guide_ , and * using * VIS, see the [_VIS User Guide_]() * DPRIS, see the _DPRIS User Guide_ , and * RCPS, see the [_Hunt User’s Guide_](). ### VI.ii.4.B.1.d. Removing the Retired Pay Indicator When Entitlement to MRP Is Terminated The retired pay indicator must be deactivated if a service department discontinues the payment of MRP to a Veteran because entitlement to MRP has terminated, for example, removal of the Veteran from the Temporary Disability Retirement List (TDRL). Deactivate the retired pay indicator by * selecting the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen * clicking the ADD button * entering the type of MRP that was terminated in the RETIRED PAY TYPE field * entering the date payment of MRP ended in the EFFECTIVE DATE field, and * entering _0.00_ in the GROSS AMOUNT field. **Important:** If a service department awards a Veteran discharge pay after discontinuing MRP, it will be necessary to update the fields on the DISCHARGE PAY tab, as well.**References:** For more information on * taking the actions described in this block, see the _VBMS Awards User Guide_ , and * removal of a Veteran from the TDRL, see M21-1, Part VI, Subpart ii, 4.B.6. ### VI.ii.4.B.1.e. Ensuring the Veteran’s Branch of Service and SSN Are Recorded in the Corporate Record A Veteran’s branch of service and Social Security number (SSN) _must_ be recorded in the corporate record to ensure the proper exchange of information between VA and retired pay centers (RPCs). Ensure the branch of service in the corporate record is the same as the branch that is paying MRP.**Reference:** For more information on making entries and updates to the corporate record, see the _Share Online Help_. ### VI.ii.4.B.1.f. Data VA Provides to Military RPCs The data VA provides to RPCs includes data pertaining to all original and reopened awards and any supplemental award actions if _all_ of the following criteria are met: * the entitlement type is disability compensation or Dependency and Indemnity Compensation * authorization of an award (including automated cost-of-living adjustments), and * the Veteran’s SSN is recorded in the corporate record. ## 2. Adjusting an Award Affected by MRP This topic contains information on adjusting awards that are affected by MRP, including * processing an award to a Veteran in receipt of MRP * determining the effective date of entitlement and the effective date of payment * deadline for authorizing awards * RPC action when the rate of compensation exceeds the rate of MRP * processing an award when the rate of compensation exceeds the rate of MRP * determining the effective date for a reduced award, and * tax exemption of MRP and notifying the Veteran of eligibility. January 26, 2026 ### VI.ii.4.B.2.a. Processing an Award to a Veteran in Receipt of MRP Withhold benefits to prevent the concurrent payment of VA benefits and MRP when concurrent payment is prohibited.To calculate the amount of benefits to withhold, use the [Retired Pay Withholding Calculator](), which is accessible on the _[Military Pay]()_ webpage.**Exceptions:** Do **_not_** withhold for MRP when * processing the **__initial compensable disability rating__** _and_ the Veteran meets full Concurrent Retirement and Disability Pay (CRDP) requirements described in [M21-1, Part VI, Subpart ii, 4.A.2.f]() (claims processors must upload the documentation described in the first row of the table in [M21-1, Part VI, Subpart ii, 4.A.2.g]()), _or_ * restoring benefits VA previously reduced (e.g., restoring the payment of additional compensation for dependents that were removed for failure to return [_VA Form 21-0538, Mandatory Verification of Dependents_]()), _and_ written correspondence is obtained from the RPC certifying no retroactive adjustments to MRP were completed to account for the reduction of VA benefits. Certification from the RPC may **_not_** be obtained from RCPS or by telephone. **Notes:** * For the purposes of this block, the term **_initial compensable disability rating_** means the _first_ rating decision that VA * grants entitlement to special monthly compensation (SMC), **_and/or_** * assigns a service-connected (SC) evaluation of 10 percent or higher. * When restoring benefits VA previously reduced and withholding for MRP _is_ required, in the decision notice, invite the Veteran to submit proof from the respective RPC, showing no retroactive adjustments to MRP were completed to account for the reduction of VA benefits for the time period of the reduction. If the Veteran submits the evidence requested, adjust the withholding of compensation for MRP accordingly. **References:** For more information on * the circumstances under which concurrent payment of VA benefits and MRP is prohibited, see [M21-1, Part VI, Subpart ii, 4.A.1.a]() * the manual calculation of MRP withholdings, see the [_Guide to Calculating Military Retired Pay Withholdings Following the Rescission of Fast Letter 07-01_]() * making award adjustments, based on a Veteran’s receipt of MRP, in VBMS-A, see the _VBMS Awards User Guide_ * CRDP, see * [M21-1, Part VI, Subpart ii, 4.A.6]() * [38 CFR 3.750](), and * [10 U.S.C. 1414]() * SMC, see [M21-1 Part VIII, Subpart iv, 4.A](), and * failure to return [_VA Form 21-0538_](), see [M21-1, Part VII, Subpart i, 1.B.4](). ### VI.ii.4.B.2.b. Determining the Effective Date of Entitlement and the Effective Date of Payment Apply the provisions of * [38 CFR 3.400]() when determining the effective date of _entitlement_ to a benefit, and * [38 CFR 3.31]() when determining the effective date of _payment_ of a benefit. **Reference:** For an explanation of the difference between the effective date of payment and effective date of entitlement, see [M21-1, Part VI, Subpart i, 1.A.2.b](). ### VI.ii.4.B.2.c. Deadline for Authorizing Awards On [Compensation Service’s online calendar](), the following entry will appear monthly, usually around the middle of each month: __Stop retired pay withholding effective_ _[**month/day/year**]_,_if award authorized before_ _[**cutoff time**]._ _Awards with a retired pay withholding shall not be authorized from_ _[**cutoff time**]__to_ _[**one hour following cutoff time**]__on_ _[**month/day/year**]. __On or after_ _[**one hour following cutoff time**]__on_ _[**month/day/year**]__stop retired pay withholding with a_ _[**month/day/year**] __effective date_._All awards that increase a Veteran’s compensation effective the first day of the current month, based on a corresponding reduction in the Veteran’s MRP, must be authorized by the cutoff time on the date referenced in the above paragraph.If authorization is not accomplished by the cutoff time on the referenced date, the award must be regenerated to reflect the increase in compensation (and reduction in MRP) from the first day of the _following_ month.**Rationale:** If the award is authorized _after_ the cutoff time on the referenced date without regenerating the award as described, the Veteran’s RPC will not have sufficient time to reduce the Veteran’s MRP from the first day of the current month. The one-hour moratorium allows the Hines Information Technology Center time to start the file that is used by the RPCs for this purpose.**Note:** For quality review purposes, the timestamp on award prints is shown as Eastern Standard Time (or Eastern Daylight Time, when in effect). ### VI.ii.4.B.2.d. RPC Action When the Rate of Compensation Exceeds the Rate of MRP Any time RPCs receive data showing a Veteran’s monthly rate of compensation exceeds the monthly rate of MRP, the RPC automatically releases to the station of origination (SOO) * a certification of the gross MRP, and * the effective dates of any rate changes in the Veteran’s MRP for the previous two years. Upon receipt of the notice described above from an RPC, the SOO must * review the military payment history, and * initiate payment of any previously withheld compensation that exceeds the amount of MRP for the same period. **Note:** If the information referenced in this block does not exist in the claims folder but is relevant to award processing, it may be obtained * through RCPS (for Air Force, Army, Navy, Space Force, and Marine Corps retirees only) * by calling CGRASB at 1-866-772-8724, or * through VIS. **Reference:** For more information on using * RCPS, see the [_HUNT User’s Guide_](), and * VIS, see the [_VIS User Guide_](). ### VI.ii.4.B.2.e. Processing an Award When the Rate of Compensation Exceeds the Rate of MRP When processing an award and the monthly rate of compensation exceeds the monthly rate of MRP, * begin the award effective the earliest date that entitlement is established, as determined under the basic rules of [38 CFR 3.400]() and [38 CFR 3.31](), and * pay the difference between the rate of compensation and the rate of MRP from the start of the award until the date that the payment of compensation at the full rate may be authorized, as determined by M21-1, Part VI, Subpart ii, 4.B.2.c. For the periods authorizing the differential rate, * show the amount not paid because of receipt of MRP as a retired pay withholding, and * zero out the MRP withholding on the award line that reflects payment of compensation at the full rate. **Reference:** For more information on making award adjustments involving MRP in VBMS-A, see the _VBMS Awards User Guide_. ### VI.ii.4.B.2.f. Determining the Effective Date for a Reduced Award Retroactively reduce benefits in accordance with existing laws and regulations ([38 CFR 3.501]()). ### VI.ii.4.B.2.g. Tax Exemption of MRP and Notifying the Veteran of Eligibility Anytime VA pays a Veteran less than the full rate of disability compensation because the Veteran was in receipt of MRP, VA must notify the Veteran that MRP in an amount equal to the amount of compensation VA withheld (because of the Veteran’s receipt of MRP) is tax exempt. Include the following text in the corresponding decision notice to notify the Veteran of the tax exemption: Include the following text in the corresponding decision notice to notify the Veteran of the tax exemption:_Because VA compensation is not taxable, you may be entitled to a tax exemption during the period VA withheld your compensation; the amount of the exemption would be the amount of compensation VA withheld based on your receipt of military retired pay. __ __Subsequent changes in the amount of compensation VA withholds based on your receipt of military retired pay may affect the tax exemption. Please contact the Internal Revenue Service with questions about your tax liability._ ## 3. Handling Cases in Which a Service Department Has Not Yet Calculated the Amount of MRP It Will Pay a Veteran This topic contains instructions for handling cases in which a service department has not yet calculated the amount of MRP it will pay a Veteran, including * actions to take prior to authorization when the amount of a Veteran’s MRP is unknown * updating the award-processing system based on data displayed in RCPS * awarding benefits after determining the amount of a Veteran’s MRP has not yet been calculated * review and processing of * end product (EP) 290, and * EPs 290 that involve a Veteran who retired from the Coast Guard, National Oceanic and Atmospheric Administration (NOAA), or U.S. Public Health Service (PHS) * handling cases in which the date of retirement or separation falls on the 31st day of a month, and * adjusting a running award of disability compensation when the amount of a Veteran’s MRP was previously unknown. June 5, 2025 ### VI.ii.4.B.3.a. Actions to Take Prior to Authorization When the Amount of a Veteran’s MRP Is Unknown Follow the instructions in the table below _immediately prior to_ authorization of an award to a Veteran when the amount of MRP to which the Veteran is entitled is unknown. | **Step**| **Action** 1| Follow the instructions in the table below. | **If the Veteran retired from the …**| **Then go to …** * Army * Navy * Air Force * Space Force, or * Marine Corps | Step 4. * Coast Guard, * National Oceanic and Atmospheric Administration (NOAA), or * U.S. Public Health Service (PHS) | the next step. 2| Contact CGRASB at 866-772-8724 and ask whether the amount of the Veteran’s MRP has been calculated. 3| Has the amount of the Veteran’s MRP been calculated? * If _yes_ , * ask CGRASB for the amount(s) and the effective date(s) of payment(s) of MRP * document the information obtained from CGRASB on [_VA Form_ _27-0820, Report of General Information_](), and upload the form into the Veteran’s electronic claims folder (eFolder) * update the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen in the award-processing system based on information CGRASB provided, and * disregard the remaining steps in this table. * If _no_ , * disregard the remaining steps in this table, and * follow the instructions in **_Step 2_** of the procedure outlined in M21-1, Part VI, Subpart ii, 4.B.3.b. 4| Access RCPS by logging into the [Defense Information Systems Agency (DISA) Multi-Host Internet Access Portal (MIAP)](). 5| Once RCPS opens, enter the following text in the upper, left-hand corner of the screen: _HUNT_**[enter a space _or_ comma, the Veteran’s nine-digit SSN, and a comma]**_ENTIT_. **Example:** _HUNT 999999999,ENTIT_ 6| Press _Enter_ on the keyboard. 7| Does the SELECTED ENTITLEMENT DATA screen appear after pressing _Enter_? * If _yes_ , the Veteran’s service department _has_ calculated the amount of MRP it will pay the Veteran. * Follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.b, for updating the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen in the award-processing system. * Pay compensation in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.2. * If _no_ , the Veteran’s service department has _not_ yet calculated the amount of MRP it will pay the Veteran. Follow the instructions in the table below. | **If the message …**| **Then …** _THE REQUESTED DATA FIELDS ARE BLANK FOR THIS SSN_ appears at the bottom of the NRPS INQUIRY DIRECTORY screen| follow the instructions in **_Step 2_** of the procedure outlined in M21-1, Part VI, Subpart ii, 4.B.3.b. _THE REQUESTED INFORMATION DOES NOT EXIST FOR THIS SSN_ appears at the bottom of the NRPS INQUIRY DIRECTORY screen| * request the Veteran’s retirement orders through DPRIS to confirm the Veteran retired * upload the orders into the Veteran’s eFolder when they arrive, and * follow the instructions in **_Step 2_** of the procedure outlined in M21-1, Part VI, Subpart ii, 4.B.3.b. **Notes:** * In order to gain access to RCPS, users must navigate to the [_Military Pay_]() webpage and follow the access request instructions found in the _How to Register for an AMPS Account – External User Only_. * Upon completion, the access request is automatically routed to the following individuals/destinations, in sequential order: * the user’s immediate supervisor * the information security officer or human resource (HR) office, and * DFAS. * User guides for supervisors and information security/HR officers are also available on the [_Military Pay_]() webpage. * When necessary, users may * reset RCPS by pressing the _Pause/Break_ key on the keyboard, or * unlock a frozen RCPS screen by pressing the _Esc_ key on the keyboard. * Do not log out of the DISA MIAP in order to maintain access throughout the day. * Claims processors may also obtain RCPS data by contacting DFAS via telephone at 1-866-622-4602. **References:** For more information on using * RCPS, see the [_Hunt User’s Guide_](), and * DPRIS, see the _DPRIS User Guide_. ### VI.ii.4.B.3.b. Updating the Award-Processing System Based on Data Displayed in RCPS The table below contains instructions for updating the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen in the award-processing-system based on data displayed on the SELECTED ENTITLEMENT DATA screen in RCPS. | **Step**| **Action** 1| Has the Veteran’s service department calculated the amount of MRP it will pay the Veteran? * If _yes_ , go to Step 3. * If _no_ , go to the next step. 2| * On the RETIRED PAY tab, * enter the retirement date (separation date plus one day) in the EFFECTIVE DATE field, and * leave the GROSS AMOUNT field blank. * Disregard the remaining steps in this table and follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. **Important:** Do **_not_** enter _0.00_ in the GROSS AMOUNT field, as doing so deactivates the retired pay indicator. 3| Look at the fields that appear along the right side of the SELECTED ENTITLEMENT DATA screen in RCPS. Is the amount displayed in the PR GP (prior gross pay) field $0.00? * If _yes_ , * enter the date displayed in the CURR GP EFF DT (current gross pay effective date) field and the amount displayed in the CURR GP (current gross pay) field into the EFFECTIVE DATE and GROSS AMOUNT fields, respectively, on the RETIRED PAY tab in the award-processing-system, and * disregard the remaining step in this table. * If _no_ , go to the next step. 4| Follow the instructions in the table below. | **If …**| **Then …** the _same_ date is displayed in the CURR GP EFF DT and PR GP EFF DT (prior gross pay effective date) fields| enter the date displayed in the CURR GP EFF DT field and the amount displayed in the CURR GP field into the EFFECTIVE DATE and GROSS AMOUNT fields, respectively, on the RETIRED PAY tab in the award-processing-system. _different_ dates are displayed in the CURR GP EFF DT and PR GP EFF DT fields| * enter the date displayed in the PR GP EFF DT field and the amount displayed in the PR GP field into the EFFECTIVE DATE and GROSS AMOUNT fields, respectively, on the RETIRED PAY tab in the award-processing-system * click on the ADD button on the RETIRED PAY tab * enter the date displayed in the CURR GP EFF DT field and the amount displayed in the CURR GP field into the EFFECTIVE DATE and GROSS AMOUNT fields, respectively, on the RETIRED PAY tab, and * click on the DONE button on the RETIRED PAY tab. **Reference:** For more information on using VBMS-A, see the _VBMS Awards User Guide_. ### VI.ii.4.B.3.c. Awarding Benefits After Determining the Amount of a Veteran’s MRP Has Not Yet Been Calculated Withhold **_all_** disability compensation when a withholding for MRP is required in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.2.a-c, _and_ fewer than six months have passed since the Veteran retired without the service department calculating the amount of MRP. When a withholding for MRP is required, establish end product (EP) 290 after authorizing the award by * using the current date as the date of claim and the claim label * _IDES Retired Pay Waiver/Election_ when processing an Integrated Disability Evaluation System (IDES) case, or * _BDD Retired Pay Waiver/Election_ when processing any other type of case * entering _Awaiting MRP Information_ as an associated contention, and * adding the appropriate tracked item as identified in [M21-4 Appendix D](), with a suspense date that is 10 days from the current date. **Exception:** Do _not_ withhold _all_ disability compensation if a Veteran is already receiving disability compensation on the date of retirement. Under such circumstances, withhold only the amount of any _increase_ in compensation to which the Veteran is entitled. **Important:** Do _not_ withhold for MRP if * six or more months have passed since the Veteran retired and the Veteran’s service department has not yet calculated MRP, or * the effective date and authorization of the award is before the corresponding retired pay cutoff date/time, as described in M21-1, Part VI, Subpart ii, 4.B.2.c. ### VI.ii.4.B.3.d. Review and Processing of EPs 290 Follow the instructions in the table below for every EP 290 that was established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. | **Step**| **Action** 1| Follow the instructions in the table below. | **If the Veteran retired from the …**| **Then …** * Army * Navy * Air Force * Space Force, or * Marine Corps | go to the next step. * Coast Guard * NOAA, or * PHS * disregard the remaining steps in this table, and * follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.e. 2| Access RCPS by logging into the [DISA MIAP](). 3| Once RCPS opens, enter the following text in the upper, left-hand corner of the screen: _HUNT_**[enter a space _or_ comma, the Veteran’s nine-digit SSN, and a comma]**_ENTIT_. **Example:** _HUNT 999999999,ENTIT_ 4| Press _Enter_ on the keyboard. 5| Does the SELECTED ENTITLEMENT DATA screen appear after pressing _Enter_? * If _yes_ , * follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.b to update the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen, and * go to Step 10. * If _no_ , go to the next step. 6| Have six months passed since the date of separation? * If _yes_ , go to the next step. * If _no_ , go to Step 9. 7| Remove the withholding for MRP effective the date the withholding first began on or after the last retirement date. **Important:** Do **_not_** enter _0.00_ in the GROSS AMOUNT field when updating the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen, as doing so deactivates the retired pay indicator. Leave the field blank instead. 8| * Notify the Veteran of the action taken, and * disregard the remaining steps in this table. 9| Follow the instructions in the table below. | **If the message …**| **Then …** _THE REQUESTED INFORMATION DOES NOT EXIST FOR THIS SSN_ appears at the bottom of the NRPS INQUIRY DIRECTORY screen| * disregard the remaining steps in this table * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in this table during the next review of the EPs 290 that were established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. _THE REQUESTED DATA FIELDS ARE BLANK FOR THIS SSN_ appears at the bottom of the NRPS INQUIRY DIRECTORY screen| go to the next step. 10| In RCPS, enter the following text in the upper, left-hand corner of the screen: _HUNT_**[enter a space _or_ comma, the Veteran’s nine-digit SSN, and a comma]**_VA_. **Example:** _HUNT 999999999,VA_ 11| Are the ACTUAL DED DT (actual deduction date) and ACTUAL AMT (actual amount) fields on the VA WAIVER screen populated with data? * If _yes_ , go to Step 16. * If _no_ , go to the next step. **Notes:** * The amount displayed in the ACTUAL AMT field represents the amount of MRP waived. If the amount in this field equals or exceeds the amount of the Veteran’s MRP, then the Veteran’s MRP has been waived in full. * The number displayed in the ACTUAL DED DT field represents the effective date (YYYYMMDD) of the waiver. * If _0.00_ appears in the ACTUAL AMT field, the MRP waiver was $0.00 as of the date displayed in the ACTUAL DED DT field. * If two or more columns of data are displayed on the VA WAIVER screen, * disregard the data in all but the _first_ column of data if the date displayed in the ACTUAL DED DT field is the same in all columns, or * use the data displayed in _all_ of the columns if at least one of the dates displayed in the ACTUAL DED DT field does not match. 12| Have 10 working days passed since the award action described in M21-1, Part VI, Subpart ii, 4.B.3.c, was authorized? * If _yes_ , go to Step 15. * If _no_ , go to the next step. 13| Did the SELECTED ENTITLEMENT DATA screen referenced in Step 5 appear after taking the actions described in Steps 3 and 4? * If _yes_ , go to the next step. * If _no_ , * stop here * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in this table during the next review of the EPs 290 that were established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. 14| Does the amount of MRP the Veteran receives exceed the gross monthly amount of the Veteran’s disability compensation? * If _yes_ , * clear the EP 290, and * disregard the remaining steps in this table. * If _no_ , * withhold from the Veteran’s award the gross monthly amount of MRP from the date compensation is payable following separation to the date the withholding for MRP ended * notify the Veteran of the action taken, and * disregard the remaining steps in this table. 15| * Send an email to [VAVBAWAS/CO/MILPAY]() that includes (in the body of the email message) the * Veteran’s claim number, and * statement _Sending per instructions in Step 15 of the procedure outlined in M21-1 VI.ii.4.B.3.d_. * Take no further action until the Military Pay Staff responds with further instructions. 16| Follow the instructions in the table below. | **If the …**| **Then …** * date in the ACTUAL DED DT field matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased, and * amount of the Veteran’s MRP is unknown * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in this table during the next review of the EPs 290 that were established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. * date in the ACTUAL DED DT field matches an effective date of the award of disability compensation, and * amount in the ACTUAL AMT field is greater than $0.00 * make the appropriate entries on the RETIRED PAY tab of the AWARD ADJUSTMENTS screen in the award-processing system to reduce the amount of disability compensation VA withheld by the amount displayed in the ACTUAL AMT field, effective the date displayed in the ACTUAL DED DT field, and * notify the Veteran of the action taken. **Caution:** Do **_not_** adjust the Veteran’s award for any periods _prior_ to the date displayed in the ACTUAL DED DT field. **Notes:** * After making the award adjustment described in this cell, * paste a copy of a screenshot of the VA WAIVER screen into a Word document * follow the instructions in [M21-1, Part II, Subpart ii, 2.A.1.b](), for converting the Word document into a portable document format (PDF) file * index the PDF file by entering, * _Retired Pay Screen_ in the DOCUMENT CATEGORY – TYPE field * _VA Waiver_ in the SUBJECT field, and * _DFAS_ as the CONTENT SOURCE, and * upload the file into the Veteran’s eFolder. * The award adjustment described in this cell releases to the Veteran disability compensation VA withheld from the date displayed in the ACTUAL DED DT field up to the amount displayed in the ACTUAL AMT field. * If the amount of MRP is known, and the amount displayed in the ACTUAL AMT field equals or exceeds the MRP amount, remove the withholding for MRP from the corresponding ACTUAL DED DT field. * If the amount of MRP is unknown and the amount displayed in the ACTUAL AMT field is _less_ than the amount of disability compensation VA withheld for MRP, * continue the EP 290 at authorization * notify the Veteran of the action taken * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in M21-1, Part VI, Subpart ii, 4.B.3.d, until all the actions required to close out the EP are completed. * date in the ACTUAL DED DT field matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased * amount in the ACTUAL AMT field matches the amount of disability compensation VA paid from the date in the ACTUAL DED DT field, and * Veteran’s MRP is _less_ than the amount of disability compensation to which the Veteran is entitled * make the appropriate entries on the RETIRED PAY tab of the AWARD ADJUSTMENTS screen in the award-processing system to reduce the amount(s) of disability compensation withheld for MRP to the gross monthly amount(s) of MRP the Veteran received prior to the date in the ACTUAL DED DT field, and * notify the Veteran of the action taken. **Note:** The award adjustment described in this cell releases to the Veteran all disability compensation that exceeds the amount of gross monthly MRP. * date in the ACTUAL DED DT field matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased * amount in the ACTUAL AMT field matches the amount of disability compensation VA paid from the date in the ACTUAL DED DT field, and * Veteran’s MRP is equal to or exceeds the gross amount of disability compensation to which the Veteran is entitled | no further action is necessary except to clear the pending EP 290. date in the ACTUAL DED DT field is _later_ than the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased **Note:** VA may have overpaid the Veteran in this case.| * send an email to [VAVBAWAS/CO/MILPAY]() that includes (in the body of the email message) the * Veteran’s claim number, and * statement _Sending per instructions in Step 16 of the procedure outlined in M21-1 VI.ii.4.B.3.d_, and * take no further action until the Military Pay Staff responds to the email. ### VI.ii.4.B.3.e. Review and Processing of EPs 290 That Involve a Veteran Who Retired From the Coast Guard, NOAA, or PHS Follow the instructions in the table below for every EP 290 that * was established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c, and * involves a Veteran who retired from the * Coast Guard * NOAA, or * PHS. | **Step**| **Action** 1| Contact CGRASB at 866-772-8724 and ask whether * the amount of the Veteran’s MRP has been calculated, and/or * a VA waiver has been posted. 2| Has the amount of the Veteran’s MRP been calculated, or has a VA waiver been posted? * If _yes_ , * ask CGRASB for the amount(s) and effective date(s) of * payment(s) of MRP, and/or * the VA waiver * document the information obtained from CGRASB on [_VA Form 27-0820_]() and upload the form into the Veteran’s eFolder, and * go to Step 6. * If _no_ , go to the next step. 3| Has the EP 290 been pending more than six months from the date of separation? * If _yes_ , go to the next step. * If _no_ , * stop here * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in this table during the next review of the EPs 290 that were established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. 4| Remove the withholding for MRP effective the date the withholding first began on or after the last retirement date. **Important:** Do **_not_** enter _0.00_ in the GROSS AMOUNT field when updating the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen, as doing so deactivates the retired pay indicator. Leave the field blank instead. 5| * Notify the Veteran of the action taken, and * disregard the remaining steps in this table. 6| Has the amount of the Veteran’s MRP been calculated? * If _yes_ , * follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.b, for updating the RETIRED PAY tab on the MILITARY PAYMENT INFORMATION screen, and * go to the next step. * If _no_ , go to the next step. 7| Was VA waiver information received from CGRASB as described in Step 2? * If _yes_ , go to Step 11. * If _no_ , go to the next step. 8| Have 10 working days passed since the award action described in M21-1, Part VI, Subpart ii, 4.B.3.c, was authorized? * If _yes_ , go to the next step. * If _no_ , go to Step 10. 9| * Send an email to [VAVBAWAS/CO/MILPAY]() that includes (in the body of the email message) the * Veteran’s claim number, and * statement _Sending per instruction_ _s in Step 9 of the procedure outlined in M21-1 VI.ii.4.B.3.e_. * Take no further action until the Military Pay Staff responds with further instructions. 10| Does the amount of MRP the Veteran receives exceed the gross monthly amount of the Veteran’s disability compensation? * If _yes_ , * clear the EP 290, and * disregard the remaining steps in this table. * If _no_ , * withhold from the Veteran’s award the gross monthly amount of MRP from the date compensation is payable following separation to the date the withholding for MRP ended * notify the Veteran of the action taken, and * disregard the remaining steps in this table. 11| Follow the instructions in the table below. | **If …**| **Then …** * the effective date of the VA waiver matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased, and * the amount of the Veteran’s MRP is unknown * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps in this table during the next review of the EPs 290 that were established in accordance with the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. * the effective date of the VA waiver matches an effective date of the award of disability compensation, and * the amount of the VA waiver is greater than $0.00 * make the appropriate entries on the RETIRED PAY tab of the AWARD ADJUSTMENTS screen to reduce the amount of disability compensation VA withheld by the amount of the VA waiver from the effective date of the VA waiver, and * notify the Veteran of the action taken. **Caution:** Do **_not_** adjust the Veteran’s award for any periods _prior_ to the effective date of the VA waiver. **Notes:** * The award adjustment described in this cell releases to the Veteran disability compensation VA withheld from the effective date of the VA waiver in the amount of the VA waiver. * If the amount of the VA waiver is _less_ than the amount of disability compensation VA withheld for MRP, * continue the EP 290 at authorization * notify the Veteran of the action taken * update the tracked item suspense date to reflect a date that is 10 days from the current date, and * repeat the steps described in M21-1, Part VI, Subpart ii, 4.B.3.e, until all the actions required to close out the EP are completed. * the effective date of the VA waiver matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased * the amount of the VA waiver matches the amount of disability compensation VA paid from the effective date of the VA waiver, and * the Veteran’s MRP is _less_ than the gross amount of disability compensation to which the Veteran is entitled * make the appropriate entries on the RETIRED PAY tab of the AWARD ADJUSTMENTS screen to reduce the amount(s) of disability compensation VA withheld for MRP to the gross monthly amount(s) of MRP the Veteran received prior to the effective date of the VA waiver, and * notify the Veteran of the action taken. **Notes:** The award adjustment described in this cell releases to the Veteran all disability compensation that exceeds the amount of gross monthly MRP. * the effective date of the VA waiver matches the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased * the amount of the VA waiver matches the amount of disability compensation VA paid from the effective date of the VA waiver, and * the Veteran’s MRP is equal to or exceeds the gross amount of disability compensation to which the Veteran is entitled | no further action is necessary except to clear the pending EP 290. the effective date of the VA waiver is _later_ than the date the withholding of disability compensation (as referenced in M21-1, Part VI, Subpart ii, 4.B.3.c) ceased **Note:** VA may have overpaid the Veteran in this case.| * send an email to [VAVBAWAS/CO/MILPAY]() that includes (in the body of the email message) the * Veteran’s claim number, and * statement _Sending per instructions in Step 11 of the procedure outlined in M21-1 VI.ii.4.B.3.e_, and * take no further action until the Military Pay Staff responds to the email. ### VI.ii.4.B.3.f. Handling Cases In Which the Date of Retirement or Separation Falls on the 31st Day of a Month If the date of a Veteran’s retirement (the day following the date of separation) falls on the 31st day of a month, enter the first day of the month that follows the date of retirement in the EFFECTIVE DATE field on the RETIRED PAY tab of the MILITARY PAYMENT INFORMATION screen in the award-processing system. **Rationale:** The 31st day of a month is _not_ a pay date for MRP purposes. Therefore, when the retirement date falls on this day, MRP starts on the first day of the following month. ### VI.ii.4.B.3.g. Adjusting a Running Award of Disability Compensation When the Amount of a Veteran’s MRP Was Previously Unknown The table below contains instructions that are unique to the adjustment of a running award of disability compensation when the amount of a Veteran’s MRP was unknown on the most recent award. **Important:** * Before taking the actions described in the table below, follow the instructions in M21-1, Part VI, Subpart ii, 4.B.3.a, to ensure the amount of MRP to which the Veteran is entitled remains unknown. * If six months have passed since the Veteran retired, and the Veteran’s service department has not yet calculated MRP, it is unnecessary to establish a withholding for MRP. | **Step**| **Action** 1| Follow the instructions in the table below. | **If the Veteran retired from the …**| **Then go to …** * Army * Navy * Air Force * Space Force, or * Marine Corps | the next step. * Coast Guard * NOAA, or * PHS | Step 3. 2| * Follow the instructions in the table below. * Disregard the remaining steps in this table. | **If the ACTUAL DED DT and ACTUAL AMT fields on the VA WAIVER screen in RCPS ...**| **Then ...** * contain _no_ data, and * the amount of MRP is _known_ | withhold any increase in disability compensation in accordance with M21-1, Part VI, Subpart ii, 4.B.2. * contain _no_ data, and * the amount of MRP is _unknown_ * withhold any increase in disability compensation, and * establish EP 290 by following the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. * contain data, and * the amount of MRP is _known_ * pay disability compensation in the amount displayed in the ACTUAL AMT field from the date in the ACTUAL DED DT field, and * withhold the remaining amount in accordance with M21-1, Part VI, Subpart ii, 4.B.2. **Important:** Do **_not_** withhold disability compensation that VA paid _prior_ to the date displayed in the ACTUAL DED DT field. * contain data, and * the amount of MRP is _unknown_ * follow the instructions in the preceding row, and * establish EP 290 after authorizing the award by following the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c 3| Contact CGRASB at 866-772-8724 and ask whether * the amount of the Veteran’s MRP has been calculated, and/or * a VA waiver has been posted. 4| Has the amount of the Veteran’s MRP been calculated, or has a VA waiver been posted? * If _yes_ , * ask CGRASB for the amount(s) and effective date(s) of * payment(s) of MRP, and/or * the VA waiver * document the information obtained from CGRASB on [_VA Form 27-0820_]() and upload the form into the Veteran’s eFolder, and * go to Step 6. * If _no_ , go to the next step. 5| * Withhold any increase in disability compensation * establish EP 290 by following the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c, and * disregard the remaining step in this table. 6| Follow the instructions in the table below. | **If the …**| **Then …** amount and effective date of MRP is known, but CGRASB reports no VA waiver has posted| withhold any increase in disability compensation in accordance with M21-1, Part VI, Subpart ii, 4.B.2. * amount and effective date of MRP are known, and * amount of the VA waiver is known * pay disability compensation in the amount of the VA waiver from the effective date of the VA waiver, an * withhold the remaining amount in accordance with M21-1, Part VI, Subpart ii, 4.B.2. **Important:** Do not withhold disability compensation that VA paid prior to the effective date of the VA waiver. amount and effective date of the VA waiver are known, but the amount of MRP is unknown| * follow the instructions in the preceding row * establish EP 290 after authorizing the award by following the instructions in M21-1, Part VI, Subpart ii, 4.B.3.c. ## 4. VA, Service Department, and RPC Responsibility for Avoiding and Collecting Overpayments This topic contains information on VA’s, the service departments’, and the RPCs’ responsibility for * avoiding overpayments, and * collecting an overpayment. April 26, 2021 ### VI.ii.4.B.4.a. Responsibility for Avoiding Overpayments To avoid the creation of an overpayment in a Veteran’s account, * VA is responsible for processing awards that use effective dates determined in accordance with M21-1, Part VI, Subpart ii, 4.B.2 * the service department is responsible for contacting VA to inquire whether or not a Veteran eligible for MRP is already in receipt of VA benefits, and * the RPCs are responsible for the timely processing of waivers based on VA awards. ### VI.ii.4.B.4.b. Responsibility for Collecting an Overpayment Use the table below to determine who is responsible for collecting an overpayment.| **If …**| **Then …** concurrent payments of MRP and compensation or Section 306 Pension are made without * an election, or * the establishment of an effective waiver | VA is responsible for collecting the overpayment.**Important:** VA is responsible for collecting the overpayment even if VA received no notice that MRP had been awarded. * VA benefits have already been awarded, and * the Veteran _later_ becomes entitled to MRP | the service department is responsible for sending an inquiry to VA and collecting any resulting overpayment. VA fails to award benefits from the proper date, resulting in a duplicate payment of compensation and MRP| VA is responsible for collecting the overpayment. * VA processes an award correctly, and * the RPC fails to make a timely waiver adjustment | the RPC is responsible for collecting the resulting overpayment. **Note:** A General Counsel memorandum for file, dated September 18, 1972, determined that 38 U.S.C. 3104(a) (now [38 U.S.C. 5304(a)]()), prohibiting concurrent payment of VA benefits and MRP, does not preclude the application of 38 U.S.C. 3012(b)(10) (now [38 U.S.C. 5112(b)(10)]()), which permits a reduction of VA benefits effective the date last paid (the date in the LAST PAID DATE field on the CURRENT AND HISTORICAL AWARD INFORMATION page in VBMS) if the previous payment was solely VA error. That General Counsel memorandum was found to be consistent with the decision in [VAOPGCPREC 2-1990](). ## 5. Handling an Election of VA Benefits, a Reelection of VA Benefits, and an Election of MRP This topic contains instructions for handling an election of VA benefits, a reelection of VA benefits, and an election of MRP, including * handling an election of MRP from a Veteran in receipt of 306 Pension * determining whether a Veteran may reelect Section 306 Pension after waiving the benefit * handling * an election of MRP from a Veteran in receipt of disability compensation, and * a reelection of disability compensation * determining the effective date of an award when VA denied the prior claim because the Veteran elected MRP * special consideration of Veterans hospitalized for an SC disability, and * awarding benefits when _VA Form 21-651_ is timely received from a Veteran in a VA or service hospital. January 26, 2026 ### VI.ii.4.B.5.a. Handling an Election of MRP From a Veteran in Receipt of Section 306 Pension A Veteran receiving Section 306 Pension may elect to receive MRP. An election of MRP does not bar subsequent election of other benefits administered by VA.**Note:** The effective date of reelection of VA benefits is governed by [38 CFR 3.401(e)(3)]().**Reference:** For more information on a Veteran’s right to elect MRP and reelect VA benefits, see [38 CFR 3.750](). ### VI.ii.4.B.5.b. Determining Whether a Veteran May Reelect Section 306 Pension After Waiving the Benefit Although a Veteran may waive Section 306 Pension in order to receive MRP, VA might not allow the Veteran to reelect the same VA benefit at a later date.Entitlement to Section 306 Pension is not protected under [38 CFR 3.960]() if the disability or annual income did not continuously meet protected pension eligibility criteria from the date pension was waived through the date of receipt of the reelection. Before paying Section 306 Pension to a Veteran who waived pension to receive MRP, request evidence to determine if the Veteran would have been continuously entitled to Section 306 Pension for the entire period that the pension payments were waived. Absent evidence of continuous entitlement, the Veteran can no longer receive Section 306 Pension. If entitlement to current-law pension exists, VA may pay this benefit to the Veteran. ### VI.ii.4.B.5.c. Handling an Election of MRP From a Veteran in Receipt of Disability Compensation Follow the steps in the table below when a Veteran in receipt of disability compensation checks a box on an application for VA benefits (such as the box in Block 26 of [_VA Form 21-526EZ, Application for Disability Compensation and Related Compensation Benefits_)]() _**rejecting**_ receipt of VA compensation in lieu of MRP.**Exceptions:** * As stated in [M21-1, Part VI, Subpart ii, 4.A.2.a](), a waiver of MRP is **_not_** required when a Veteran is eligible for full Concurrent Retirement and Disability Pay. * If a Veteran who is **_not_** eligible for MRP checks the box referenced in the preceding paragraph, * disregard the steps in the table below, and * notify the Veteran that VA cannot act on the election because there is no eligibility for MRP. | **Step**| **Action** 1| * Establish EP 290. * Add _Potential Under/Overpayment_ as a special issue. 2| Attempt to contact the Veteran by telephone to confirm the election of MRP over disability compensation. 3| Were attempts to contact the Veteran by telephone successful? * If _yes_ , go to the next step. * If _no_ , * clear the EP 290, and * go to Step 9. 4| Did the Veteran confirm the election of MRP over disability compensation? * If _yes_ , * discontinue the payment of disability compensation effective the date of receipt of the election * notify the Veteran of the action taken, and * disregard the remaining steps in this table. * If _no_ , go to the next step. 5| * Ask the Veteran to * complete [_VA Form 21-651_](), **_including_** Blocks 2 through 5 (even though the form indicates VA is responsible for completing those blocks), and * sign and return the form to VA within 24 hours. * Inform the Veteran that VA will initiate action to discontinue disability compensation if the form is not returned within 24 hours. **Note:** Inform the Veteran of the opportunity to provide the form electronically via use of VA claims submission service websites. 6| Create the appropriate tracked item for return of [_VA Form 21-651_](), as identified in [M21-4, Appendix D](), with a suspense date that is five business days from the current date. 7| Did the Veteran indicate an intent to provide the form electronically? * If _yes_ , * check the Veteran's eFolder for receipt of the [_VA Form 21-651_]() after the suspense date referenced in Step 6 passes, and * go to the next step. * If _no_ , go to the next step. 8| Did the Veteran return [_VA Form 21-651_]() __ within the allotted time period? * If _yes_ , * clear the pending EP 290 * notify the Veteran that VA received _[VA Form 21-651]()_ and, accordingly, will make no adjustments to the award, and * disregard the remaining steps in this table. * If _no_ , * clear the EP 290, and * go to the next step. 9| * Establish EP 600. * Add _Potential Under/Overpayment_ as a special issue. 10| Issue a notice of proposed adverse action that informs the Veteran that * VA intends to discontinue disability compensation effective the date VA received the election * the Veteran’s election will result in the creation of an overpayment, and * if the Veteran wishes to withdraw the election, [_VA Form 21-651_]() must be completed, signed, and returned within 60 days. **Rationale for providing due process:** * An election of MRP over VA benefits is _not_ listed as an exception (in [38 CFR 3.103(b)(3)]()) to the requirement that VA provide due process before reducing a beneficiary’s award. * Veterans often mistakenly check the box on VA forms that elects not to receive VA compensation in lieu of MRP. Providing due process ensures Veterans have an opportunity to confirm the election to waive disability compensation in order to receive MRP. **Reference:** For more information about issuing notice of a proposed adverse action, see [M21-1, Part X, Subpart ii, 3.A](). 11| Did the Veteran return [_VA Form 21-651_]() __ within 65 days? * If _yes_ , * clear the pending EP 600, and * notify the Veteran that VA will not take the action it proposed in Step 10. * If _no_ , * discontinue the payment of disability compensation effective the date of receipt of the election, and * notify the Veteran of the action taken.. **Important:** * Treat [_VA Form 21 -526EZ_]() or a signed statement (referenced in [M21-1, Part VI, Subpart ii, 4.A.2.e]()) as a completed [_VA Form 21-651_]() when submitted at any point in the process described in the table above. * Before treating [_VA Form 21 -526EZ_]() as a completed [_VA Form 21-651_](), ensure the Veteran did **_not_** check the box on the form that indicates * a desire to receive MRP instead of VA compensation, or * rejection of receipt of VA compensation in lieu of MRP. **References:** * [M21-1, Part XI, Subpart ii, 3.A.3](), contains instructions for handling an election that is pending when a Veteran dies. * Follow the instructions in [M21-1, Part VI, Subpart ii, 4.A.3.a](), if a Veteran to whom VA has _not_ yet awarded disability compensation files a claim for this benefit but elects MRP. ### VI.ii.4.B.5.d. Handling Reelection of Disability Compensation When a Veteran, whose disability compensation VA discontinued because the Veteran elected MRP, later _reelects_ disability compensation, * resume the payment of disability compensation, effective the date of receipt of the election, and * establish a withholding for the MRP according to the instructions in M21-1, Part VI, Subpart ii, 4.B.2.a. **Reference:** [M21-1, Part XI, Subpart ii, 3.A.3](), contains instructions for handling an election that is pending when a Veteran dies. ### VI.ii.4.B.5.e. Determining the Effective Date of an Award When VA Denied the Prior Claim Because the Veteran Elected MRP Follow the instructions in the table below when * VA denies a Veteran’s claim for disability compensation because the Veteran elected MRP, and * the Veteran files a subsequent claim on a form that includes a waiver of MRP one year or more after VA notified the Veteran of the denial. **Note:** Follow the instructions in the last sub-bullet in [M21-1, Part VI, Subpart ii, 4.A.3.c](), if VA receives the subsequent claim _within_ one year of the date VA notified the Veteran of the denial.| **If ...**| **Then award compensation for the disability (if otherwise in order) effective the first of the month following the date ...** the rating activity * granted SC for a new disability based on the subsequent claim, and * assigned a compensable disability rating to the disability | of entitlement shown on the new rating decision. the _initial_ rating decision included a grant of SC for a disability with a compensable disability rating and * the rating activity determined _in the initial rating decision_ that the disability was static (no future examination was required), or * the rating activity reevaluated the disability based on the subsequent claim but determined no change in the current disability rating is warranted. | VA received the subsequent claim. the rating activity granted an increase in the disability rating assigned to a disability based on the subsequent claim| the new rating decision shows the Veteran is entitled to the increased disability rating. **Important:** * The policies described in the table above also apply if * VA denies a Veteran’s claim for disability compensation because the Veteran elected MRP * the Veteran files a subsequent claim on a form that does **_not_** include a waiver of MRP one year or more after VA notified the Veteran of the denial, and * the Veteran waives MRP within one year of the decision notice regarding the _subsequent_ claim. * _Payments_ of disability compensation may be subject to the withholding referenced in M21-1, Part VI, Subpart ii, 4.B.2.a, until the Veteran’s RPC makes corresponding adjustments to MRP. ### VI.ii.4.B.5.f. Special Consideration of Veterans Hospitalized for an SC Disability When _all_ of the conditions listed below are met, notify the Veteran of the VA benefits that are payable and tell the Veteran that if a formal election is filed within one year of the date of the notice, eligibility for VA benefits will be established from the date of hospitalization: * VA receives notice from a VA medical center or military treatment facility of a Veteran’s hospitalization for an SC disability * a waiver of the Veteran’s MRP is not currently in effect, and * it appears the VA benefits that are payable would be greater than the Veteran’s MRP. **Note:** If a rating under [38 CFR 4.29]() or [4.30]() is involved, inform the Veteran of the temporary nature of the VA benefits.**Reference:** For more information on the forms a Veteran may submit to waive MRP, see [M21-1, Part VI, Subpart ii, 4.A.2](). ### VI.ii.4.B.5.g. Awarding Benefits When VA Form 21-651 Is Timely Received From a Veteran in a VA or Service Hospital If, after receiving the notice discussed in M21-1, Part VI, Subpart ii, 4.B.5.f, a Veteran submits _[VA Form 21-651]()_ within one year of the date of the notice, award benefits effective the date of hospitalization.**Notes:** * The award, in this case, is subject to a withholding for the MRP the Veteran received from the effective date of the award, as provided in M21-1, Part VI, Subpart ii, 4.B.2.a. * Apply the provisions of [38 CFR 3.31]() when determining the effective date of _payment_. ## 6. Removal of a Veteran From the TDRL This topic contains information on the effect of a Veteran’s removal from the TDRL, including * general information on the removal of a Veteran from the TDRL * removal from the TDRL of a Veteran * in receipt of VA benefits, and * who is not receiving VA benefits, and * awarding of severance pay following removal of a Veteran from the TDRL. January 26, 2026 ### VI.ii.4.B.6.a. General Information on the Removal of a Veteran From the TDRL VA may become aware of a Veteran’s removal from the TDRL through * notification from an RPC * notification from the Veteran, or * routine review of the Veteran’s claims folder. In any case, * follow the procedures in * M21-1, Part VI, Subpart ii, 4.B.6.b, if the Veteran is receiving VA benefits * M21-1, Part VI, Subpart ii, 4.B.6.c, if the Veteran is _not_ receiving VA benefits, or * M21-1, Part VI, Subpart ii, 4.B.6.d, if the Veteran was awarded severance pay, and * inform the Veteran of rights regarding the reinstatement of benefits. ### VI.ii.4.B.6.b. Removal From the TDRL of a Veteran in Receipt of VA Benefits If an RPC provides notice that a Veteran in receipt of compensation is no longer receiving MRP, follow the instructions in M21-1, Part VI, Subpart ii, 4.B.1.d for removing the retired pay indicator from the corporate record. ### VI.ii.4.B.6.c. Removal From the TDRL of a Veteran Who Is Not Receiving VA Benefits When a Veteran who never filed a claim for VA benefits or whose claim VA denied due to the Veteran’s receipt of MRP is removed from the TDRL, send a letter to the Veteran’s last known address of record that * acknowledges the Veteran’s removal from the TDRL * encourages the Veteran to file a claim for VA disability benefits, even if the Veteran * was placed on the permanent disability retired list, or * received disability severance pay, and * includes [_VA Form 21-526EZ_](). _**Note**_ : If VA received the notice of the Veteran’s removal from the TDRL from an RPC, the Veteran’s address will be displayed in the lower left-hand corner of the notice. ### VI.ii.4.B.6.d. Awarding of Severance Pay Following Removal of a Veteran From the TDRL RPCs occasionally notify VA that a Veteran in receipt of compensation has been * removed from the TDRL, and * awarded severance pay. In these cases, review the instructions unique to recoupment of disability severance pay, as discussed in [M21-1, Part VI, Subpart ii, 2.3](), and, if necessary, send the Veteran notice of proposed adverse action before adjusting benefits. Unless the Veteran submits evidence within 65 days that demonstrates VA should _not_ take the proposed action, follow the instructions in the table below.| **Step**| **Action** 1| Prepare an amended award in accordance with instructions in [M21-1, Part VI, Subpart ii, 2](). 2| Follow the instructions in M21-1, Part VI, Subpart ii, 4.B.1.d for removing the retired pay indicator from the corporate record. 3| Begin withholding VA benefits to recoup the severance pay effective the date in the LAST PAID DATE field on the CURRENT AND HISTORICAL AWARD INFORMATION page in VBMS. 4| Send a decision notice to the Veteran that fully explains the actions taken. **References:** For more information on * issuing notice of proposed adverse action, see [M21-1, Part X, Subpart ii, 3.A]() * preparing a decision notice, see [M21-1, Part VI, Subpart i, 1.B](), and * withholding benefits to recoup severance pay in VBMS-A, see the _VBMS Awards User Guide_. ## 7. Effect of a Reduction of Benefits Under 38 CFR 3.551 on MRP April 26, 2021 ### VI.ii.4.B.7.a. Handling the Reduction of a Veteran’s Award Under 38 CFR 3.551 Unlike pension, MRP is _not_ subject to reduction when a Veteran is hospitalized at VA expense.If a Veteran is hospitalized and has waived a portion of MRP to receive Section 306 Pension, * VA reduces the Veteran’s award under [38 CFR 3.551](), and * the Veteran’s RPC * makes the appropriate adjustment to the Veteran’s MRP based on the award data VA transmits to the RPC, and * notifies VA of changes in the Veteran’s hospitalization status if the RPC receives such information first. **Rationale:** This reciprocal action ensures the Veteran receives full entitlement, but not in excess thereof, on each benefit, per [38 U.S.C. 5305]().**Reference:** For more information on reducing a Veteran’s award under [38 CFR 3.551](), see [M21-1, Part X, Subpart iii, 1.D]().