If you are a service member facing divorce in Nebraska, your military retirement pay is likely one of the most significant assets on the table. What you may not realize is that it may not stay yours entirely, and understanding how courts divide it can help you protect what you have earned.
Federal law governs how military retirement pay is divided
Military retirement pay is not divided the same way as a bank account or a house. A federal law called the Uniformed Services Former Spouses’ Protection Act (USFSPA) governs it, giving state courts the authority to treat retired pay as marital property in a divorce. That does not mean your spouse automatically receives a share. A court order is required, and Nebraska courts decide the division as part of the broader marital estate.
One important detail for active-duty service members: if you are still serving at the time of the divorce, federal law freezes the divisible portion based on your rank and years of service at that point, not at your eventual retirement date.
The 10/10 rule does not govern the division of your retirement pay
Many service members believe the 10/10 rule determines whether a court can divide their retirement in a divorce. It does not. It only affects how the military sends the payments.
Here is what it actually means: if you were married for at least 10 years overlapping with 10 years of military service, the Defense Finance and Accounting Service (DFAS) will send your former spouse their share directly each month. If that threshold is not met, the court can still divide your retirement; you just become responsible for making those payments yourself.
Not all of your retirement pay is on the table
Not all of your retirement pay is on the table. Courts can only divide what the law terms disposable retired pay — your gross retirement minus deductions like VA disability compensation and Survivor Benefit Plan premiums.
Federal law also caps how much DFAS can pay out directly. That limit is 50% for property division, though it can go up to 65% when child support or alimony is also involved.
Court order language can make or break your case
If the order dividing your retirement pay is vague or uses incorrect language, DFAS may reject it entirely. The order needs to clearly identify the award, specify the formula used and address whether you are already retired or still serving. Getting this language right the first time matters because fixing a defective order later can be costly and time-consuming.
If you are a service member in Nebraska navigating divorce, working with an attorney familiar with both Nebraska family law and the USFSPA can make a significant difference in protecting your retirement.