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How a Veterans Disability Settlement Can Affect a Divorce Case

Jim's 58 year old client is permanently disabled because of his service in the military. He is able to receive a monthly pension from the Department of Veterans Affairs.

He wants to be aware of whether a verdict by a jury will impact his VA benefits. It will not. However, it will affect the other sources of income he earns.

Do I have the right to receive compensation in the event of an accident?

You could be eligible to receive a settlement if you were in the military but are now permanently disabled because of injuries or illnesses. This settlement can help you get compensation for medical bills, lost wages and other expenses that result from your illness or injury. The kind of settlement you will receive will depend on whether or not your illness or injury is a result of a service connection, the VA benefits you qualify for, and the cost to treat your accident or injury.

Jim who is a 58-year old Vietnam veteran was diagnosed with permanent disabilities because of his two years of service. He does not have enough space for work to be eligible for Social Security Disability benefits, however, he is able to claim an VA Pension that offers cash and medical treatment for free dependent on the amount of money he needs. He wants to know how a personal injury settlement will affect his ability to receive this benefit.

The answer will depend on whether the settlement is in the form of one lump sum or a structured settlement. Structured settlements involve payments over time instead of one payment. The amount paid by the defendant is calculated to offset the existing VA benefits. A lump sum payment will impact any existing VA benefits as the VA will annually evaluate and consider it as income. If Jim has excess assets after the settlement has been annualized then he is eligible to be eligible for the pension benefit. However his assets must be below a minimum threshold that the VA has set that establishes financial necessity.

Do I really need to hire an Attorney?

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

It is possible to file an application for disability benefits on your own however, the majority of disabled veterans would require the help of a professional lawyer. A veteran's disability lawyer who is experienced will examine your medical records and gather the necessary evidence to make a convincing argument to the VA. The lawyer can also file any appeals you may need in order to receive the benefits you are entitled to.

The majority of VA disability lawyers do not charge for consultations. The government also pays the lawyer directly from the benefit of retroactive benefits. This is one of the benefits of the Equal Access to Justice Act. The percentage of retroactive past-due benefits your lawyer will be paid should be clearly outlined in your fee agreement. For example, a fee agreement can stipulate that the government will pay the attorney up to 20% of the retroactive benefits or award. You will be accountable for any additional sums.

Can I Garnish My VA Benefits?

When a disabled veteran receives compensation from the VA it is received in the form of monthly payments. The funds are meant to compensate for the effects of injuries, illnesses or disabilities that were suffered or aggravated during a veteran's service. As with all income, veterans disability benefits can be subject to garnishment.

Garnishment lets a court order that an employer or government agency deduct money from the wages of a person who owes an amount and then pay it directly to the creditor. In the event of a divorce garnishment may be used to pay child or spousal care.

However, there are certain situations where disability benefits may be refunded. Most common is the veteran who has waived his military retirement in order to receive disability compensation. In these instances, the portion of pension that is devoted to disability compensation can be garnished to pay for family support obligations.

In other instances, a veteran's benefits may also be seized in order to pay for medical expenses or federal student loans that are past due. In these instances the court might be able to go straight to the VA to obtain the necessary information. A disabled veteran should seek out an experienced attorney to safeguard their disability benefits. This will prevent them from relying on payday lenders or private loans.

Can I Represent Myself in a Divorce Case?

VA disability settlements can be a huge aid to veterans disability lawyers and their families. However they also come with specific complications. If a veteran is divorced and receives a VA settlement, he or she should be aware of the impact this could have to their benefits.

In this case the most important question is whether disability payments are considered to be assets that can be split in a divorce. The question has been answered in two ways. A Colorado court of appeals ruling found that VA disability payments were not property and therefore could not be divided in this manner. The U.S. Supreme Court ruled in Howell, that garnishing a veteran's VA disability payments to pay Alimony was against the USFSPA.

Another concern relating to this subject is the treatment of disability benefits for child support and maintenance. Both the USFSPA as well as the Supreme Court, prohibit states from utilizing disability benefits as income. Certain states use different methods. Colorado is one example. It takes all income sources together to determine the amount needed to support a spouse. It then adds disability benefits in order to take into account their tax-free status.

It is also essential that veterans are aware of how divorce can affect their disability compensation and how their spouses who divorced could slash their benefits. By knowing about these issues, veterans can safeguard their income and avoid unintended consequences.