The Department of Veterans Affairs (VA) offers directly, or in conjunction with other federal agencies, several benefits for surviving spouses, children, and dependent parents of deceased veterans to provide them with financial, educational, and emotional support. Among these various programs, Dependency and Indemnity Compensation (DIC) is a monthly tax-free cash payment for eligible surviving spouses, children, and dependent parents. This report outlines the eligibility requirements and benefit levels for DIC and the policy issues associated with DIC. If the eligibility criteria for DIC related to the veteran's death are met, the survivors also have certain criteria to meet to be eligible for DIC. Policy Issues

Several policy issues are associated with DIC, including the DIC offset of Survivor Benefit Plan (military retirement survivor) payments, often referred to as the "widow's tax;" adequacy of the payments for survivors compared with other retirement systems' payments to surviving spouses; remarriage age of 57; length of time for a totally disabled rating for non-service-connected deaths to qualify for DIC; and maximum DIC payment for parents based on income levels that have not been adjusted for inflation. The Civil War also led to other changes to survivor compensation, especially for survivors of servicemembers with service-connected disabilities.
The Department of Veterans Affairs (VA) administers directly, or in conjunction with other federal agencies, programs that provide benefits and other services to veterans and their spouses, dependents, and beneficiaries.
One of the benefits that VA administers is Dependency and Indemnity Compensation (DIC) for survivors of certain servicemembers and veterans. DIC is a monthly tax-free cash payment to survivors and dependents of servicemembers killed while on active military duty and those of certain veterans. Survivors of veterans who die from service-related conditions are eligible for DIC. Survivors of veterans who die from non-service-connected conditions may be eligible for DIC if the veteran was eligible for, or was receiving, disability compensation as totally disabled (a 100% rating) for a period of time (specified in statute) before the veteran's death.
Several policy issues are associated with DIC, including the DIC offset of Survivor Benefit Plan (military retirement survivor) payments, often referred to as the "widow's tax"; adequacy of the payments for survivors compared with other retirement systems' payments to surviving spouses; the remarriage age of 57; length of time for a totally disabled rating for non-service-connected deaths to qualify for DIC; and maximum DIC payment for parents based on income levels that have not been adjusted for inflation.
This report outlines the eligibility requirements and benefit levels for DIC and related policy issues.