Division of Military Retirement Pay - Dual Coverture

© 2011 Brian Mork, Ph.D. [Rev 2.8]

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Divorce is a path many people have to live with, and under these situations, it is beneficial to pursue equity. In order to equitably divide the marriage asset of military retirement pay due to divorce, one must understand different issues than other types of retirement.  Issues discussed on this page apply to both Active Duty and Reserve military retirements.  If you are intested in Reserve military specific issues, please see another web page about dividing military reserve retirement pay.  If your concerns are more specific, see other web pages describing Promotion Enhancement or Dual Coverture Value calculations.

When dealing with normal civilian retirements, a coverture fraction method typically calculates what portion of a retirement was earned during the marriage, and then that portion is divided. Historically, this manifests as a "coverture fraction" that you are probably familiar with. Extending the coverture concept to a Dual Coverture fraction is required to equitably deal with military retirements. There have been nascent attempts by attorneys and courts to implement this concept, but without complete documentaion, attempts have been rife with litigation and confusion.

This page introduces the Dual Coverture formulaic method which accommodates situations where there is no military duty before marriage, and there is one spouse with divorce prior to retirement.  Downloadable resources demonstrate Dual Coverture utility and offer formulaic representation. Additional research has yielded a superior method called the Dual Coverture Value method which has wider scope of applicability than all previously published methods, while matching the results of well-known formulaic methods such as those published by DFAS.

Retirement Division Methods

Civilian retirements use calendar months as proration in the first coverture fractions because individuals work contiguous days.  For military with a Reserve retirement, duty points must be used in the place of calendar time in the coverture fraction because any period of calendar time may include many duty days varying down to none at all. Any Active Duty retirement can also be divided with point methods because each day of duty corresponds to one point (365 or 366 each year).

A January 2011 New Jersey Appellate Court ruling (see detailed discussion) confirms the inability of time-only or point-only coverture fractions to equitably divide a military retirement asset. A military retirement is different than civilian retirements because it is looked up in a 2-dimensional pay table, using 1) time of service, and 2) rank. Reference 10 USC 12739, and 10 USC 1406 or 1407. The two factors of time and rank are independent, and cannot be captured in one fraction; a proper coverture fraction is the result of two mathematical fractions multiplied together: the time or Duty Fraction, and the Rank Fraction. A blog entry from the lead defense attorney in the NJ case questions whether the single time fraction is viable any more. Several contract firms that generate military division orders for attorneys have picked up on the same court case and discuss it on their web pages.

If only one ratio is used, the non-military spouse would benefit from all military promotions outside the marriage, and this is contrary to equity. Unlike time-based promotions where the two issues can be comingled into one coverture ratio, military promotions are always unique, special, or outstanding based on stratification of eligible promotees, limited quotas, deployment records, testing results, advanced school degrees, competitive formal performance reports, and professional military education. An entire web page and white paper is dedicated to the topic of dividing military promotion enghancements equitably in a divorce.

Due to a Federal interest to have uniformity among the state's rulings and protect Federal interests, there is a sanctioned method of doing these calculations espoused by the Department of Defense, Senate, Congress, and Federal Defense Finance and Accounting (DFAS) office to ensure equitable division when additional military duty or promotions are done after a divorce. DFAS calls this method their Hypothetical Method, outlined step by step in Para 2, Page 9 of the January 4, 2010 version of the USFSPA Attorney Instructions Dividing Military Retired Pay.

In a Department of Defense report to Congress and the DFAS document, the precise method of calculable precision is given to separate the portion of indivisible non-marital enhancement due to promotions. The DFAS guide has several examples, so be sure to consider the examples suited to your particular situation.  All calculation methods and examples are not interchangeable, and some will be wrong for your situation.  Although DFAS cites the Hypothetical Method for Active Duty military members who receive a promotion after divorce, they fail to cite the same method again as applied to Reserve military members, leading some attorneys to incorrectly assume Reserve officers are never promoted after divorce.

In order to clarify the calculations involved, I have made available a detailed white paper memorandum titled Attorney Instructions - Dividing Reserve and Active Duty Military Retirement. This paper also includes discussion about a new Federal January 2008 law that applies to dividing Reserve Military Early Retirement.  The paper includes a derivation of the formulas, example legal order text, and calculation examples.  If you are taking military retirement issues to court, I recommend you print out a copy, have it reviewed by a CPA and then pay the CPA to show up as an expert witness. The "Hypothetical Method" the NJ Court refers to on pg 19 of its opinion, and the Dual Coverture method the NJ Court refers to on pg 22 are mathematically identical if you stipulate that COLA increases are about the same as military pay raises. Although the two methods yield the same result, you should read why the Dual Coverture method is better.

The Dual Coverture method uses two fractions multiplied together. One fraction is a time ratio (duty during marriage/total duty), and the other is a rank ratio (basepay of rank at divorce/basepay of rank at retirement). Be careful to use the same year's pay charts when looking up the numerator and denominator for the rank ratio--doesn't matter which year chart you use because you're calculating just a ratio, not the isolated values. Multiplying the time ratio and the rank ratios together gives the proper overall dual-coverture fraction to use in the court order sent to DFAS.

You can download a spreadsheet and try your numbers using a Dual Coverture Value calculator from the resources below.

Federal Opinion and DFAS Guidance

The Federal government has interest in allocating Federal retirement, and has given specific guidance. As a result of the DoD report to Congress, DFAS created the Hypothetical Method and explained it in their Instructions to Attorneys document. Remember, the DFAS assertions have been vetted through Dept Defense, Senate Armed Services Committee, House Armed Services Committee, and undergone countless hours of public scrutiny and debate. DFAS wrote the following text:
"We apply retired pay COLAs to the hypothetical retired pay amount up to the member’s actual retirement date to find a “present value” of the hypothetical retired pay as of the member’s actual retirement date. This adjustment does not result in the former spouse benefiting from the member’s additional service time or promotions after the hypothetical retirement date. It simply provides the former spouse with the amount he or she would have received had the member actually become eligible to receive retired pay on the hypothetical retirement date.
Notice the last two sentences mitigate the concern that it's biased against the military member!  It's clear that both spouses receive time-value of money while waiting for the payments to be delivered. Remember the Hypothetical Method and Dual Coverture methods create the same coverture fraction and are applied to retirement payments in the same way, so when you talk about one, you talk about the other. DFAS wrote the updated manual quoted above in response to direction in the DoD Report to Congress Concerning Federal Former Spouse Protection Laws, page 71-72, dated September 5, 2001:
"Congress should amend the USFSPA [laws] to provide that all awards of military retired pay be based on the member’s rank and years of service at the time of divorce. This provision should be exclusively prospective. For example, if a future divorce occurs when the member is an O-4 (i.e., Major/Lieutenant Commander) with 14 years of creditable service, the award of military retired pay must be based on that rank and time served. That the member retires as an O-6 (i.e, Colonel/Captain) with 24 years of service is irrelevant to the award of military retired pay as property.

"The pay increase attributable to the promotions and additional time served should be viewed as the member’s separate property. [emphasis mine] However, as a matter of equity, the former spouse should benefit from increases in the pay table applicable to the O-4 grade. Thus, as the pay for an O-4 with 14 years of service is increased due to increases in the pay table, so too is the value of the allocation to the former spouse. The objective in this regard should be to provide the former spouse, on a present value basis, with approximately the same amount of retired pay that he or she would have actually received had payments begun on divorce. DFAS should include a formula in its recommendations that could be used by parties who divorce while the member is still on active duty.
I would again emphasize that the only way to do what is written in the quote above with a formula in a court order is the Hypothetical Method or a Dual Coverture method, and the Dual Coverture Method is much simpler and better for both parties.

According to the last sentence recommendation quoted above from the Congressional report, DFAS did include a formula, and this formula gives results identical to the dual fraction method requested by the defendant in the New Jersey Appellate Court case, and supported by the Department of Defense, vetted through the Senate Armed Services Committee, House Committee on Armed Services, and Defense Finance and Accounting Services.


The resultant damages of using a single coverture when a dual coverture is the equitable answer are significant; rank promotions hover around 17% increase in base pay with some higher or lower (and retirement is proportional to base pay). Because the mistake comes from the military member to the non-military member, that creates a double, or 38%, error in equity.  This is huge -- much larger than 15% rule of thumb on income changes to change support payments, or the 5% threshold where medical insurance would be ordered for a child.

Multiply this error by the number of military in the nation and the number of divorces and the duration of a person's retirement time, and you'll see that this is a $Billion dollar issue misunderstood by the court system.  Ironically, vocational skills most fitting into a Reserve military way of life tend to include professional skills such as teacher, doctor, or ...lawyer. In a professional symposium, I recently met two civilian judges who are also Reserve military lawyers.  When they start to collect their personal military retirements, they will have a much larger vested interest in understanding these issues.


In summary, the NJ Appellate Court properly allowed that post-marriage promotion enhancement should not be divided, introducing the Dual Coverture method into case law. The Dual Coverture method is better than the Hypothetical Method for multiple reasons, and has been extended to a Dual Coverture Value method which is better than both because of its versatility and scope. When declining the defendant's proposed formulaic implementation of Dual Coveture, the Appellate Court made a factual error that led them to make a judicial error with great injustice to a military member.


  1. Barr v. Barr New Jersey Appellate Court ruling, January 2011, 418 N.J. Super. 18 (App. Div. 2011). Argued by Jennifer Millner and Eliana T. Baer and Robert A. Epstein v. Mr. Silber and David E. Alberts in front of Axelrad, R.B. Coleman, and Liholts. (FindLaw.com, Law.com #1Law.com #2, Leagle.comRutgers.edu, increa copy) (31 pgs, 106kb)
  2. "Be specific in divorce agreements to avoid future legal trouble", Jennifer Millner, Air Force Times, 24 March 2011.
  3. DFAS "Guidance on Dividing Military Retired Pay", 2 April 2012, 20 pgs, 119 KB pdf. (DFAS.mil, increa copy)
  4. DFAS "Attorney Instructions - Dividing Military Retired Pay", April 2001, 19 pgs, 74kb pdf. (DFAS.mil, increa copy).
  5. DoD Report to Committee on Armed Services of the US Senate and House of Representatives, 1998. (Defense.gov, increa copy) (84 pgs, 279kb pdf)
  6. Mork Attorney Instructions - Division of Reserve and Active Duty Military Retirement (increa copy).
  7. Blog post Dual Coverture is better than DFAS Hypothetical Method, February 2011.
  8. Excel spreadsheet for doing Dual Coverture Calculator spreadsheet, September 2012.

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This article originally appeared on the Increa.com blog.  The shell of this expanded document was created using AbiWord under the Linux Gnome desktop. Content was edited using Kompozer.