What are the main differences between CRSC and concurrent receipt (CRDP), and why might veterans choose one over the other?
Executive summary
Combat-Related Special Compensation (CRSC) and Concurrent Retirement and Disability Pay (CRDP) are two separate federal programs that let eligible military retirees receive both VA disability compensation and retired pay, but they differ sharply in eligibility rules, tax treatment, application requirements, and how benefits are calculated [1] [2] [3]. Choosing between them usually comes down to whether disabilities are combat-related, whether a retiree meets CRDP’s rating threshold, and whether tax-free income or a larger gross payment matters more to the individual [4] [5] [6].
1. What CRDP is and who it helps
CRDP restores retired pay that was reduced because a retiree elected to receive VA disability compensation, effectively eliminating the historical “VA waiver” for many retirees and allowing those eligible to receive both payments concurrently; CRDP is an automatic entitlement for retirees who meet its criteria and does not issue a separate “CRDP check” but instead restores service pay directly [2] [7] [3]. The FY2004 NDAA phased in full concurrent receipt for retirees with at least a 50% VA disability rating, so CRDP generally benefits retirees with higher overall VA ratings regardless of whether injuries were combat-related [4] [5].
2. What CRSC is and who it helps
CRSC is a DoD program targeted at retirees whose disabilities are attributable to combat, combat training, or similar hostile activity; it is awarded through an application process to the branch of service and pays a separate, non-taxable compensation designed to replace a portion of the retired pay lost to the VA offset [3] [4] [8]. Unlike CRDP, CRSC focuses on the combat-related portion of a disability rating and can cover service-connected conditions arising during combat or qualifying training events [9] [1].
3. Eligibility, tax treatment, and the mechanics that matter
The two programs differ in three practical ways that usually decide which is preferable: eligibility scope (CRDP applies broadly to those meeting the VA-rating threshold; CRSC is limited to combat-related conditions) [4] [5], tax status (CRSC payments are non-taxable while CRDP restorations are taxable as restored retired pay) [3] [6], and process (CRDP is generally automatic once eligible, while CRSC requires an application and a DoD determination) [3] [2].
4. Why veterans might choose one over the other
Veterans will typically choose the program that yields the higher after-tax benefit: someone with a high overall VA rating and few combat-attributable conditions often does better under CRDP because it restores a larger portion of retired pay, whereas a veteran with lower overall rating but significant combat-attributable impairments may prefer CRSC because its tax-free payments can produce a higher net benefit [6] [10]. Financial circumstances—tax bracket, other income, and the presence of combat nexus documentation—drive the decision as much as statutory eligibility [6] [2].
5. Interaction, switching, and administrative notes
A retiree cannot receive both CRDP and CRSC at the same time; for those who qualify for both, DFAS (and DoD rules) will assess which program produces the greater payment and pay that amount, and retirees have an annual opportunity during open season to change their election if eligible [1] [2] [7]. Calculating CRSC can be more complex than CRDP—CRSC benefits are commonly thought of as a three-part calculation that separates retired pay, VA compensation, and the CRSC payment based on combat-related percentages—so careful documentation and often service-branch adjudication are required [1].
6. The practical takeaway and limits of reporting
In practice the choice reduces to three questions: is the disability combat-related (CRSC only), does the retiree meet CRDP’s rating rules (CRDP eligibility), and which program yields better after-tax income; the literature and official guidance stress comparing dollar-for-dollar outcomes and keeping thorough records for CRSC applications [4] [3] [2]. This analysis relies on the sources cited above; if specific case numbers or recent policy tweaks are needed, official DFAS or service-branch guidance should be consulted because program details and thresholds have been subject to legislative and administrative updates [11] [1].