Military Retirement Pay Veterans Benefits And Divorce Make For Tax Confusion
At the end of the day, this case is about how the benefit of converting from military retirement pay to veterans benefits should be divided. If the case had gone the other way, half the benefit would have gone to the ex-spouse. The simple guiding principles should be that when in doubt you go with the disabled veteran, but, of course, those judges can’t just come out and say that. As a practical matter, divorce agreements allocating military retirement payment should probably explicitly address what happens if the pay is reduced due to veterans benefits.
Windsor As A Precedent – Much More Than Taxes
Essentially what they are saying is that they don’t have a dog in this fight. They wanted to turn the money over to the Court and let the prospective beneficiaries argue about it. Cozen O’Connor knows it has to be pay somebody, but wants the Court to say whom. Since the Cozen O’Connor plan explicitly incorporated ERISA language in its plan document, the constitutionality of DOMA was critical to the decision.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.
