What You Need to Know About Veterans Disability Settlement

The VA program pays compensation for disability based on the loss of earning capacity. This system is different from workers' compensation.

Jim received a lump-sum settlement of $100,000. The VA will annualize the lump sum for one year. This will offset his Pension benefit. He will only be able to apply for a new pension benefit after the annualized amount has been returned to him.

Compensation

Veterans and their families may be entitled to compensation from the government for disability injuries incurred during military service. These benefits can be the form of a disability or pension. If you're thinking about a personal injury lawsuit or settlement on behalf of a disabled veteran there are a few important points to be aware of.

If a veteran who has disabilities receives an award or settlement against the person who is at fault for their injuries, and also has a VA disability claim in the same year, then the amount of that settlement or award may be taken from their VA payments. This type of garnishment comes with certain restrictions. First you must file a court petition to be filed to apportion the funds. Then, only a fraction of the monthly salary is able to be garnished, typically between 20 and 50%.

Another thing to remember is that the compensation is calculated based on a percentage the disability of a veteran and not on the actual earnings earned from an employment. The higher the disability rating the more compensation they'll receive. Family members of survivors of disabled veterans who die of a service-related illness injuries are eligible for a particular benefit known as Dependency Insurance Compensation (DIC).

There are many myths about the effect that veterans' retirement benefits along with disability pay and other compensation from the Department of Veterans Affairs have on divorce issues involving money. These misconceptions can make a divorce even more difficult for veterans and their families.

Pension

Veterans Disability Pension (VDP) is an income tax-free monetary benefit paid to veterans with disabilities that were incurred or worsened by their military service. It is also available to surviving spouses and dependent children. Congress sets the pension rate that is based on disability level, severity of disability and dependents. The VA has specific regulations regarding how assets are evaluated to determine the eligibility criteria for the Pension benefit. Generally speaking, the veteran's residence or personal effects as well as a vehicle are disregarded, while the remaining non-exempt assets of the veteran must not exceed $80,000 to prove financial need.

A common misconception is that the courts can garnish VA disability payments in order to accomplish court-ordered child or support obligations for spouses. It is important to note that this isn't the case.

The courts can only take a veteran's pension away if they have waived their military retired pay in order to receive compensation for an impairment. 38 U.S.C. SS5301 (a) is the law that governs this.

It is important to understand that this doesn't apply to CRSC or TDSC pay, since these programs are specifically designed to provide higher levels of income to disabled veterans. It is important to note that a person's personal injury settlement could affect their eligibility for aid and attendance.

SSI

If a veteran is not earning earned income and has an ongoing disability and is disabled, they may be eligible for Supplemental Security Income (SSI). This is a program based on need. A person must have low income and assets to be eligible for SSI. Certain people could also be eligible for an VA monthly pension. The amount is determined by the length of service, the wartime period and disability rating.

The majority of veterans aren't eligible for a Pension and Compensation benefit simultaneously. If a person has pension benefits and is receiving disability payments from the VA and is eligible for a disability payment, the VA will not pay an income supplement to that person.

The VA is required to report your monthly military retirement, CRDP or CRSC to the Social Security Administration (SSA). This will nearly always increase your SSI benefit. The SSA can also calculate your SSI income based on the VA waiver benefits.

If a veteran is required to pay for support in an order from a judge, the court may go directly to VA to garnish the retirement benefits of the military. This is a possibility in divorce cases when the retiree is required to waive his retirement benefits to receive VA disability payments. The U.S. Supreme Court ruled recently in the case Howell that this practice was in violation of federal law.

Medicaid

Veterans with disabilities that are related to their service may be eligible for Medicare and Medicaid. He must prove that he been able to meet the five year look-back period. Also, he must present documents to prove his citizenship. He is not able to transfer assets without an amount that is fair market value however, he can keep his primary residence and one vehicle. He is allowed to keep up to $1500 in cash or the face value of a life-insurance policy.

In the event of divorce the judge can decide to consider the veteran's VA Disability payments as income when the calculation of child support and maintenance following the divorce. This is due to the numerous court rulings that have confirmed the rights of family courts to utilize these payments as income in support calculations. These include decisions from Florida, Mississippi (Steiner v. Steiner), Wisconsin (In the case of the marriage of Wojcik) and other states.

The VA disability compensation is based on the severity of the condition. It is calculated based on an index that ranks the severity of the condition. It can vary between 10 percent and 100 percent. Higher ratings will result in more money. It is also possible for veterans to receive additional compensation for attendance and aid expenses, or a special monthly payments that are not based upon a schedule but on the severity of the disability.