For those who have been following for a long time, I know I have explained SCAADL (Special Compensation for Assistance with Activities of Daily Living) before but this deserves repeating. For those new to WW (wounded warrior) battle, let me explain a few things to you. When your service member is injured, you (the caregiver) are first put on ITO (Invitational Travel Orders) to come be here with them. Once you arrive at their MTF (Medical Treatment Facility) you begin receiving $71 per day Per Diem (this is amount is based on your geographic location, $71 is for the DC/VA/MD area). Once your soldier discharges you then receive NMA (Non-Medical Attendant) orders which entitles you to continue to receive the Per Diem. You are on those orders until someone decides to stop them. It is truly unclear as to why the NMA orders end. I have asked many, many times and each time I get a different answer. The most recent one was "Well you've been here for a year." I have also heard, "You're warrior doesn't need an NMA." "They end once you are assigned here." "You're his wife, we shouldn't pay you to be here." I have several more comments like this. Funny thing is Chaz and many other service members will need a NMA for the rest of their lives. But I guess that fact is irrelevant?!
This past fall the SCAADL policy was passed. Here's the link to learn a little more about it. http://warriorcare.dodlive.mil/files/2011/09/20110919_SCAADL-Slick-Sheet-2-pager.pdf
SCAADL is a great way to help our wounded but a couple of little details were missed. The intent of SCAADL is to give the service member money to help pay for assistance to help them in their daily living activities. What I see is this. SCAADL was a way to justify terminating NMA orders and an attempt to save money from a very costly war. I pray that I am wrong.
Here's why I have that assumption. ITO/NMA Per Diem is non-taxable because it is a payment to help the caregivers with their expenses while caring for their loved one. In other words, it's a travel allowance. Caregivers are receiving $2,130 per month (tax-free) to be here. ITO/NMA funds are paid directly to the caregiver. On average, SCAADL pays the service member just over $1,000 and is fully taxable and is paid to the service member. So those funds are cut in half and fully taxable. I raise the question why?
First I question the taxation part. The IRS wrote Publication 3 specifically for the military taxpayer. It outlines all of our tax benefits in great detail. I call your attention to http://www.irs.gov/pub/irs-pdf/p3.pdf Please look at page 4 Table 1- Included items. You will see all the special pays that are fully taxable to the military members. Please read the list carefully. Note that all the special pays listed, except SCAADL have an active component to them. For example Optometry pay refers to the fact that you are working in the Optometry field for the military. Veterinarian pay means you will be working as a Veterinarian for the military. Now someone please explain to me what out wounded warriors are actively doing to earn SCAADL? Their Caregivers are actively working to help their warriors, but the funds go to the warriors and are taxable to the wounded?! I am all sorts of confused.
Next on page 5 you'll find table 2- Excluded items. In this list you will find one pay listed as Disability, including payments received for injuries incurred as a direct result of a terrorist or military action. Doesn't SCAADL match this description?! Aren't we paying our warriors SCAADL to help them recover from their disability that occurred in military action?! Compare the description of SCAADL from the first link to this one. We have an apparent contradiction don't we?! Hmm...this is in Table 2 and listed as excluded from taxation.
Why do I care so much? Here's why. I have been completing tax returns for over 11 years now. I speak IRS very fluently. I know when something with good merits ends up with bad results. Take the Making Work Pay Credit that we've all had for the past 2 years for an example. If you did not adjust your withholding last year to compensate for that credit, your refund will be $400 (or $800 if Married filing Joint) less than what it was last year and you could owe taxes this year. Making Work Pay was designed to help you get ready for how the IRS readjusted the with holding tables two years ago. The grace period ended last year so you'll feel it soon. If you had a good preparer then they were watching this trend for you and advised you appropriately.
Now let's look at the typical wounded warrior and his taxes. The average wounded warrior is in their 20s and is single or is married with one small child. Since the tax laws are in their favor they never owe taxes. Those with children get a very nice tax return which includes earned income credit, additional child tax credit. If SCAADL is added to their pay then they are adding $10,000 to $20,000 to their taxable income. That additional taxable income will disqualify them for those tax credits and if they have not adjusted their with holdings appropriately then they will owe taxes when they go to file their return.
So I ask why are we going to allow our wounded to pay the taxes for their injuries? Their tax credits should not be in jeopardy because someone didn't read Pub 3 like they should have. So let's fix it while we can. There's a new National Defense Authorization Act that will be coming up in the Fall. the NDAA of 2011 put SCAADL in place for fiscal year 2012. So why can't we add a paragraph to correct the taxation of SCAADL in the 2012 and make it retroactive (Congress has made things retroactive many times before). We can fix this now and prevent all of this.
I had a Senator's Aide tell me that if we make SCAADL non-taxable then we have to find the money elsewhere because our country depends on that revenue. I would like to slap my BS card on the table right now. Here's why. 240 service members became amputees last year. The average person is receiving around $1000 from SCAADL and has an average tax rate of 10-15%. That equates to $100 to $150 and if you multiply that times the 240 and you have $24,000 to $36,000 per month or $288,00 to $432,000 for the year. There are so many variables that play into my figures and they are all worst case scenario. You are telling me that our whole country will cease from function if we don't make up for the lost revenue of the taxation of our wounded?! Really you guys spend that on a bomb?! Senator Paul from KY just gave $500,000 back to the Treasury just a few months ago. There see I already found your money for you! Problem solved, let's fix this! I bet if we ask a few people to foot the bill for our guys they would. Someone call Gary Sinise, I but Lt Dan would help us find that money somewhere s our amputees aren't paying taxes on their injuries.
My next counter to this "we have to put the taxes back" argument is found in the WTU policy. If you go to www.armyg1.army.mil/wtu/docs/WTUConsolidatedGuidanceAdministrative.pdf and go to page 75 to letter d, you'll see if our warriors are re-hospitalized because of their wounds from combat then their entire pay is non-taxable. So we can make their entire pay (which would include SCAADL) non-taxable while they are in the hospital and we don't have to replace those tax dollars? But it is vital we replace all the out-patient taxable income which might add up to $36,000 per month?! I am confused?! So we pick and choose which dollars to replace?! Wait, no that sounds about right. But the argument remains why are we making our wounded pay taxes on the SCAADL pay. They pay their taxes through the base pay.
Here's another piece to my argument. When service members are in a combat zone all of their pays are excluded from income. So there's more missing revenue that needs to be replaced?! Let me assure if we can make a Colonel's pay non-taxable while in combat, then we can afford to make SCAADL non-taxable period. Our Colonels generate way more in tax revenue then our wounded do. Military personnel have tax laws in their favor that have been there for over a decade. Someone just didn't take the time out to review them carefully.
My next problem with SCAADL is the fact it goes to the warrior not the caregiver. I have been blessed to hear the stories of the other families and how they have sacrificed everything to be here. Numerous caregivers have lost jobs, houses, friends, their freedoms, everything to stand by their warrior's side and help them heal. Wives, parents, siblings and friends depend on that little bit of income to pay their bills and eat while they are here caring for their warriors.
To me, the WTB here is way too quick to cut those NMA orders off. And I will tell you right now, if I hear one more person from WTB say, "We pay you to be here to do this job." I swear I'll scream. First you personally didn't pay me squat. You did not personally pull out your check book and write a check to me. Second we did not sign a contract of employment with you, nor the US Army. Third, we fill out a travel voucher and file it was Department of Defense Accounting Service after we've been here for 15 days. If we take our soldier anywhere we lose that little bit of income we had. So tell me again how you pay me to be here to do a job, but when we take them home we continue to do that same job?! If you were paying me to do a job wouldn't you pay me no matter where I am doing that job?!
I am curious how you can justify the claim, "You pay me to be here." Instead of dangling a carrot over our faces like we are work horses, you should be thanking us for helping take care of our wounded together. Please remember we did not ask to be here. We are here because we love our service members. Our warriors need us to work together. So your threats and condescending attitudes need to stop. We sacrificed everything just to help our warriors move on. Our sacrifices and hard work need to be appreciated not taken for granted and belittle. I would love to see these people who are so condescending spend one hour in our shoes. I would say a whole day, but my money says they wouldn't make it an hour.
You know what's funny?! The Nurse Case Managers are the ones who help maintain those NMA orders. You know I have never ever heard one of them say "We pay you to be here." I got to tell you, I love the Nurse Case Managers here. They are so compassionate and caring. Ours have been just awesome. I have never heard anyone complain about NCMs. That says a lot huh?!
So how can you help me fix this problem. You can contact your representatives and tell them to fight for our wounded. Tell them our wounded shouldn't pay taxes for their injuries. Here's the link for the House http://www.house.gov/ and here's the one for the Senate http://www.senate.gov/ so contact them today! Feel free to send them this link. They might not be aware SCAADL is taxable and they might not realize the ramifications of this policy. So please educate them, don't yell at them for this misunderstanding. I will tell you right now it was a simple over sight. But it is an over sight we need to catch right now before it ends in disaster.