The Survivor Benefit Plan (SBP): A Guide for Military Widows

What the Survivor Benefit Plan Is

The Survivor Benefit Plan (SBP) is a Department of Defense annuity that pays an eligible surviving spouse a monthly, lifelong portion of a military member's retired pay. It is not a VA benefit, and it is not Social Security. It is administered separately by the Defense Finance and Accounting Service (DFAS), which handles military retired pay.

SBP exists to solve a specific problem: military retired pay normally stops the moment the retiree dies. Without SBP, a surviving spouse who relied on that monthly retirement check would suddenly lose all of it. SBP replaces a portion of that lost income with a guaranteed monthly annuity that continues for the survivor's lifetime and is adjusted each year for inflation through a cost-of-living adjustment (COLA).

Because it is an annuity tied to the retiree's own retired pay — not a payment based on cause of death or wartime service — SBP can be received in addition to other survivor benefits. Understanding how it fits alongside VA Dependency and Indemnity Compensation (DIC) and Social Security is one of the most important things a military widow can do, and it is covered in detail below.

One way to picture SBP is as an insurance policy on the retirement income itself. During the retiree's lifetime, the government pays them their retired pay each month. SBP is the mechanism that lets a portion of that income continue flowing to the surviving spouse after the retiree is gone, so the household does not face a sudden and permanent drop in income on top of the loss of a loved one. That continuity is the whole purpose of the program, and it is why the decision to enroll matters so much at the time of retirement.

Who Has SBP Coverage?

Not every surviving spouse of a service member is automatically covered by SBP. Coverage generally comes from one of two situations.

1. A Retiree Who Elected SBP at Retirement

When a service member retires, they decide whether to enroll in SBP and at what level. This is an election made at the time of retirement, with premiums paid from the retiree's monthly retired pay throughout retirement.

Federal law protects spouses here: a married member who wants to elect less than full SBP coverage, or decline it entirely, generally needs the spouse's written concurrence. In other words, a retiree usually cannot quietly opt out of, or reduce, the coverage that would protect their spouse without the spouse knowing and agreeing in writing.

2. Survivors of a Member Who Died on Active Duty

If a service member dies on active duty in the line of duty, eligible survivors are generally covered by SBP automatically. In these cases there is no prior "election" to worry about — coverage is provided so the family is not left without protection.

How Much SBP Pays

The SBP annuity for a surviving spouse is calculated as up to 55% of the member's elected "base amount" of retired pay. The base amount is the portion of retired pay the member chose to insure when they enrolled. A member could elect full coverage (the entire retired pay as the base amount) or a smaller base amount.

Key features of the payment:

• Monthly and lifelong — the annuity is paid every month for the surviving spouse's lifetime (subject to the remarriage rules below).
• Inflation-adjusted — the annuity receives annual cost-of-living adjustments (COLA), so it keeps pace with inflation over time.
• Pre-paid through premiums — the coverage was funded by premiums deducted from the retiree's retired pay during their retirement, not from the survivor.

The Repealed "Widow's Tax" (SBP-DIC Offset)

This is one of the most important — and most misunderstood — points for military widows, so please read it carefully.

For many years, SBP was reduced dollar-for-dollar by any VA Dependency and Indemnity Compensation (DIC) a survivor received. If you got DIC from the VA, your SBP annuity was cut by the same amount. Survivors and advocates called this the "Widow's Tax" because it effectively penalized families who were entitled to both benefits, treating two separate, earned benefits as if you had to choose one.

If you believe you are entitled to both SBP and DIC and are not receiving the full amount of each, contact DFAS about your SBP annuity and the VA about your DIC. A free accredited Veterans Service Officer (VSO) can help you sort out which benefit comes from which agency and confirm you are receiving everything you are owed.

The reason this point deserves so much emphasis is that the repeal phased in gradually, and a great deal of older guidance, paperwork, and well-meaning advice still describes the world as it was before 2023. A widow who read about SBP a decade ago, or who was counseled at the time of her spouse's death years earlier, may carry the outdated belief that she has to "choose" between SBP and DIC. That is no longer how it works. If anything you have read or been told predates 2023, treat it with caution and verify the current rules directly with DFAS and the VA.

Remarriage Rules

As with several survivor benefits, age 55 is the key threshold for SBP and remarriage:

• Remarriage before age 55: The SBP annuity is suspended while you are remarried.
• Remarriage at age 55 or older: Your remarriage does not affect your SBP annuity — it continues.
• If a remarriage before age 55 later ends by death, divorce, or annulment: the SBP annuity can be reinstated.

Is the SBP Annuity Taxable?

Yes. The SBP annuity is taxable income for federal income tax purposes, and DFAS will issue tax documents reporting what it paid you each year.

This is an important contrast with VA DIC: VA DIC is tax-free. So if you receive both benefits, one (SBP) is taxable and the other (DIC) is not. Keep this distinction in mind when you plan for taxes and estimate your after-tax income. Our guide on taxes after losing a spouse walks through filing status and other tax issues that surviving spouses face.

SBP vs. DIC vs. Life Insurance

It is easy to confuse these three benefits because they all involve money paid after a service member's death. They are separate programs from separate sources, and they can stack — receiving one does not disqualify you from the others.

Because these stack, a surviving military spouse may be eligible for an SBP annuity, VA DIC, a life insurance payout, and Social Security survivor benefits at the same time. Don't assume claiming one rules out another — claim each through its own agency.

How to Claim an SBP Annuity

Step 1: Report the Death to DFAS

Notify the Defense Finance and Accounting Service that the retiree has died. This stops the retired pay (which ends at death) and starts the survivor annuity process.

• Call DFAS: 1-800-321-1080

Step 2: Complete DD Form 2656-7

The surviving spouse completes DD Form 2656-7, Verification for Survivor Annuity. This form establishes your eligibility and provides DFAS the information it needs to start paying the annuity.

Step 3: Submit a Certified Death Certificate

Include a certified copy of the death certificate with your claim. Order several certified copies up front, because many agencies and institutions require their own original certified copy.

Step 4: DFAS Manages the Payments

Once your claim is processed, DFAS manages and pays the SBP annuity to you each month. Keep your contact and direct-deposit information current with DFAS, and watch your annual account statements.