Commutative Property. An operation is commutative if you can change the order of the numbers involved without changing the result. Addition and multiplication are both commutative. Subtraction is not commutative: 2 - 1 is not equal to 1 - 2. Here are some examples of the commutative properties of addition and multiplication: 88 + 65 = 65 + 88. 153 = 153.
Another consideration is that SBP premiums reduce the retiree's taxable income and reduce out-of-pocket costs for coverage. SBP benefits are taxed as income to the survivor however the tax rate upon receipt of the annuity will generally be less than the member's current tax rate. Most insurance plans are the reverse; premiums are paid from after-tax income, while survivors are not taxed on the proceeds.
Since SBP premiums are paid in the form of a reduction in retired pay, they are not includable as taxable income. If, for example, one's SBP premium is $100, and they are in the 28 percent marginal tax bracket, their true out-of-pocket cost would be only $72 ($100 - 28% = $72).f the SBP entitlement is $1,500 and the spousal DIC amount is $1,254 (effective December 1, 2014), then the SBP annuity is reduced to $246 ($1,500 - $1,254 = $246). The combined total of SBP and DIC is still $1,500, but $1,254 of it is tax-free.