Senate passes NDAA
In an 85 to 10
vote, the Senate on Monday passed its version of the FY 2019 National Defense
Authorization Act. The sprawling legislation must now be reconciled with the
House, which passed its
version of the bill in May.
authorizes a 2.6 percent military pay raise, matching both the administration's
request and what House lawmakers passed. The raise, consistent with
private-sector wage growth, would be the biggest pay raise for servicemembers
in eight years. This also aligns with MOAA's 2018 Storming the Hill
(* indicates MOAA's support)
House position: No new fees*
Senate position: Repeal grandfathering
MOAA Position: The most controversial provision in the Senate bill
unwinds an important TRICARE grandfathering provision from last year's defense
bill. The move repeals protections for health care beneficiaries who entered
into the service prior to Jan. 1 from a new cost share structure, one with
higher fees and pharmacy copays.
MOAA strongly opposes the Senate provision. According to the nonpartisan
Congressional Budget Office, higher out-of-pocket costs will push 20,000
beneficiaries out of TRICARE.
House position: “Sense of Congress” to end the widows tax ASAP*
Senate position: Nothing
MOAA position: While the Senate remained silent on survivors
benefits, the House included a language providing a “sense of Congress” that
they “must work together to find a way to eliminate the widows' tax entirely.”
It may seem like a small gesture, but the language provides a line in the sand
for us to return to lawmakers and say “You've admitted this is wrong. Now let's
work towards a solution.”
House position: No change to BAH
Senate position: No change to BAH
MOAA position: BAH is an essential part of Regular Military Compensation
and should not be reduced.
hundreds of amendments to the bill, including several MOAA-supported proposals
to eliminate the widows tax, expand concurrent receipt, and to provide
transition assistance to military spouses, but only a handful of amendments
were voted on.
Paul (R-Kent.) and Lindsay Graham (R-S.C.) had a public intraparty feud of the
amendment process, each accusing the other of holding up debate on the bill.
led Sen. Jim Inhofe (R-Okla.), who shepherded the defense bill while Sen. John McCain
(R-Ariz.) remains home battling brain cancer, to say he's considering changing
the rules for next year's defense bill.
Last week, the
administration issued a tepid statement on the bill saying, given the short
time between the bill's release and when it was voted on, it was not providing
feedback at this time. The statement said the White House would continue to
work with Congress as the defense bill goes through the legislative process.
The bill now
moves to conference committee for House and Senate lawmakers to iron out
differences between the two bills. Lawmakers say they expect to complete their
work on the bill by the end of July.
Trusts and VA Home Loans Don’t Mix
If you’re a veteran nearing full retirement or getting your estate
in order, you might be establishing a living trust instead of preparing a
simple will. But are you also considering taking out a new VA Home Loan?
Beware: One MOAA life member recently found out
the hard way that because he and his wife had transferred their home into an
irrevocable living trust, they were ineligible for a new VA Home Loan on this
property. The VA Home Loan Office told them that if a home is placed in trust,
then both of the individuals had to qualify for the home loan — meaning both had to be veterans.
The Code of Federal Regulation section on
veteran loan guaranty (38 CFR § 36.4354 “Estate of Veteran in Real
Property”) states, “The title of the estate in the realty acquired by
the veteran, wholly or partly with the proceeds of a guaranteed or insured loan
… shall be not less than: a life estate, provided that the remainder and
reversionary interests are subject to the lien; or a beneficial interest in
a revocable Family Living Trust …, provided the lien
attaches to any remainder interest and the trust arrangement is valid under
In layman’s terms: You can put your home in a
trust, but you can’t get a loan if you’ve put your home in an irrevocable trust. Unfortunately, this member and
his spouse had done exactly that and were denied a refinancing VA Home Loan.
Generally, what is a
trust? A property owner passes some or all of their property to a trust. The
trustee manages the trust until such time that it can be transferred to the
beneficiary, typically upon the death of the owner(s).
What are some of the benefits of a living trust?
Two main benefits entice individuals and families toward a trust. The
first is a trust avoids probate, which typically means a faster transfer of
assets to your beneficiaries. The second is that trusts provide privacy over
the matter of asset distribution; wills do not. A will’s provisions are made
public after death.
For a more detailed list of characteristics of trusts and wills please visit