B-205929 L/M, JAN 25, 1982, OFFICE OF GENERAL COUNSEL

B-205929 L/M: Jan 25, 1982

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DIGEST: RETIRED MILITARY OFFICER'S QUESTION REGARDING COMMUNITY PROPERTY ASPECT OF MILITARY RETIRED PAY AS IT MAY RELATE TO INCOME TAX IS QUESTION FOR INTERNAL REVENUE SERVICE NOT GENERAL ACCOUNTING OFFICE. DISCUSSION OF CHARACTERISTICS OF RETIRED MILITARY PAY IN A COMMUNITY PROPERTY STATE IS FOUND IN MCCARTY V. RETIRED: THIS IS IN RESPONSE TO YOUR RECENT LETTER REQUESTING AN EXPLANATION OF THE CIRCUMSTANCES BEHIND THE DECISION IN 23 COMP.GEN. 284 (1943).AS YOU INDICATE. YOUR INTEREST IS TO ASCERTAIN WHETHER "THE DECISION PRECLUDES THE CHARACTERIZATION OF MILITARY RETIRED PAY AS COMMUNITY PROPERTY UNDER CALIFORNIA COMMUNITY PROPERTY LAWS ON INCOME TAX RETURNS FILED IN THE YEARS 1977 THROUGH 1980.".

B-205929 L/M, JAN 25, 1982, OFFICE OF GENERAL COUNSEL

DIGEST: RETIRED MILITARY OFFICER'S QUESTION REGARDING COMMUNITY PROPERTY ASPECT OF MILITARY RETIRED PAY AS IT MAY RELATE TO INCOME TAX IS QUESTION FOR INTERNAL REVENUE SERVICE NOT GENERAL ACCOUNTING OFFICE. FURTHERMORE, DISCUSSION OF CHARACTERISTICS OF RETIRED MILITARY PAY IN A COMMUNITY PROPERTY STATE IS FOUND IN MCCARTY V. MCCARTY, 101 S.CT. 2728 (1981).

COLONEL WILLIAM J. WARREN, USAF, RETIRED:

THIS IS IN RESPONSE TO YOUR RECENT LETTER REQUESTING AN EXPLANATION OF THE CIRCUMSTANCES BEHIND THE DECISION IN 23 COMP.GEN. 284 (1943).AS YOU INDICATE, YOUR INTEREST IS TO ASCERTAIN WHETHER "THE DECISION PRECLUDES THE CHARACTERIZATION OF MILITARY RETIRED PAY AS COMMUNITY PROPERTY UNDER CALIFORNIA COMMUNITY PROPERTY LAWS ON INCOME TAX RETURNS FILED IN THE YEARS 1977 THROUGH 1980."

THE FOLLOWING INFORMATION MAY BE OF ASSISTANCE TO YOU.

THE CIRCUMSTANCES BEHIND ISSUANCE OF THE DECISION IN 23 COMP.GEN. 284 (1943) ARE SET FORTH ON PAGES 284 AND 285 OF THE DECISION (COPY ENCLOSED). THE SECRETARY OF WAR WISHED CLARIFICATION AS TO THE EFFECT OF SEVERAL ACTS OF CONGRESS ON THE DETERMINATION OF THE LONGEVITY OF CERTAIN OFFICERS OF THE ARMY FOR RETIREMENT PURPOSES. THE DECISION WAS ISSUED SINCE THE QUESTION WAS SUBMITTED BY THE HEAD OF AN EXECUTIVE DEPARTMENT AND INVOLVED A PAYMENT TO BE MADE UNDER HIS JURISDICTION. SEE 31 U.S.C. SEC. 74 (1976).

THE STATEMENTS IN THAT DECISION AS TO THE CHARACTER OF MILITARY RETIRED PAY WERE A REITERATION OF THE LONGSTANDING RULE THAT RETIRED PAY OF MILITARY PERSONNEL IS GENERALLY TO BE TREATED AS PAY FOR SERVICES RENDERED. THE CHARACTERIZATION OF MILITARY RETIRED PAY FOR INCOME TAX PURPOSES IS A MATTER WITHIN THE JURISDICTION OF THE INTERNAL REVENUE SERVICE AND ANY QUESTIONS SHOULD BE DIRECTED TO THEM. SEE B-147153, NOVEMBER 21, 1961.

HOWEVER, YOUR ATTENTION IS DIRECTED TO THE RECENT CASE OF MCCARTY V. MCCARTY, 101 S.CT. 2728 (1981), WHEREIN, AMONG OTHER THINGS, THE SUPREME COURT DISCUSSES THE NATURE OF MILITARY RETIRED PAY AS IT RELATES TO THE COMMUNITY PROPERTY CONCEPT IN CALIFORNIA.

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