How a Veterans Disability Settlement Can Affect a Divorce Case

Jim's 58 year old client is permanently disabled because of his time in the military. He receives a monthly pension benefit from the Department of Veterans Affairs.

He wants to be aware of whether a verdict by a jury will affect his VA benefits. The answer is that it will not. It will, however, have an impact on his other income sources.

Can I Receive Compensation for an Accident?

If you've served in the military, and are permanently disabled due to injuries or illnesses, you could be eligible for a veterans disability settlement. This settlement can assist in compensating you for medical bills, lost income, and other costs that resulted from your illness or injury. The type of settlement that you are eligible for will depend on whether your injury or illness is service-related, what VA benefits you are eligible to receive, and the amount to treat your accident or injury.

For example, Jim is a 58-year old veteran who was diagnosed with permanent disabilities following two years of service during the Vietnam War. He doesn't have enough work quarters to be eligible for Social Security disability benefits but there is a VA Pension benefit that provides medical care and Veterans cash that is based on financial need. He would like to know if a personal injury settlement will affect his ability to be eligible for this benefit.

The answer is dependent on whether the settlement is a lump-sum or a structured one. Structured settlements require the payment of over time rather than a single payment. The amount that defendant pays is calculated to offset existing VA benefits. A lump sum settlement can impact any existing VA benefits because the VA will annually calculate and consider it as income. In any case, if there are excess assets remain after the period of twelve months when the settlement is annualized, Jim may be eligible to apply again for the pension benefit, but only if his assets are lower than a threshold with which the VA accepts as establishing financial need.

Do I have to hire an attorney?

Many service members, spouses and former spouses are confused about VA disability compensation and the impact it has on financial issues in divorce cases. In addition, some people think that the Department of Veterans Affairs' compensation payments can be divided like a military pension in divorce or are "off limits" when it comes to calculation of child support and alimony. These misconceptions could lead serious financial errors.

While it is possible to file an initial claim for disability benefits on your own, many disabled veterans benefit from the assistance of a professional attorney. A disability attorney for veterans can look over your medical records and collect the evidence necessary to make a strong case in front of the VA. The lawyer can also help to make any appeals you require to receive the benefits you deserve.

Most VA disability lawyers don't charge for consultations. Additionally the lawyer will usually be paid by the government directly from your retroactive past due benefits. This is an advantage of the Equal Access to Justice Act. Your fee agreement should clearly state the amount of retroactive benefits to be paid to your lawyer. A fee agreement could state for instance that the government will pay the attorney up 20 percent of retroactive benefits. The attorney is responsible for any additional sums.

Can I Garnish My VA Benefits?

When disabled veterans receive compensation from the VA it is in the form of monthly payments. These payments are designed to help offset the consequences of illnesses, disabilities, or injuries sustained during or aggravated during a veteran's military service. As with all income, veterans disability benefits can be subject to garnishment.

Garnishment is a legal procedure that permits a court to require an employer or government agency to deduct funds from the pay of someone who is in debt and to send them directly to a creditor. In the event of a divorce the garnishment could be used for child or spousal maintenance.

There are some situations where veterans' benefits could be garnished. The most common scenario involves veterans who have waived their military retirement in order to claim disability compensation. In these scenarios the pension portion that is devoted to disability benefits can be garnished in order to cover the obligations of family support.

In other cases veterans disability lawsuits' benefits could be seized to pay medical expenses or past-due federal student loans. In these instances the court could go directly to the VA to obtain the information they require. It is vital for disabled veterans to find a competent lawyer to ensure that their disability benefits aren't being snatched away. This can help them avoid having to depend on payday and private loan lenders.

Can I Represent Myself in a Divorce Case?

VA disability settlements can be an enormous help for veterans disability law firms and their families, however they do come with their own set of issues. If a person divorces and receives an VA settlement, he or she should be aware of what this might do to their benefits.

In this case the most important question is whether or not disability benefits are considered assets that could be divided in divorce. This issue has been addressed in a variety of ways. A Colorado court of appeals ruling determined that VA disability payments were not property and could not be divided in this manner. The other way is by an U.S. Supreme Court ruling in Howell which held that garnishing a veteran's VA disability payments to pay the payment of alimony is in violation of the Uniformed Services Former Spouses Protection Act (USFSPA).

Another concern with this subject is how disability benefits are treated in the context of child support and maintenance. Both the USFSPA, as well as the Supreme Court, prohibit states from counting disability benefits as income. However, certain states have taken the opposite approach. For instance, Colorado adds up all sources of income to determine the amount in support a spouse requires and then adds the disability benefits to take into account that they are tax free.

It is also important for veterans to understand how their disability compensation will be affected when they get divorced and how their spouses' ex-spouses could take advantage of their benefits. If they are aware of these issues, veterans can protect their earnings and avoid any unwanted consequences.