How a Veterans Disability Settlement Can Affect a Divorce Case
Jim’s client, a 58 year old man, is permanently disabled because of his military service. He receives a monthly Pension benefit from the Department of Veterans Affairs.
He wants to know if the jury’s verdict will affect his VA benefits. The answer is not. It will, however, have an impact on the income sources of his other income sources.
Can I Receive Compensation for an Accident?
If you have served in the military but are now permanently disabled because of injuries or illnesses, you may be eligible for a veteran disability settlement. This settlement will pay you for medical bills, lost income, and other expenses that resulted from your illness or injury. The type of settlement that you will receive will depend on whether your injury or illness is service-connected, what VA benefits you qualify for, as well as the cost to treat your injury or accident.
For example, Jim is a 58-year veteran who was diagnosed with permanent disabilities after two years of service during the Vietnam War. He doesn’t have enough work quarters to be eligible for Veterans Disability Compensation Social Security disability benefits but there is a VA Pension benefit that provides cash and medical treatment for free based on financial need. He would like to know how a personal injuries settlement will affect his ability to receive this benefit.
The answer is dependent on whether the settlement is in the form of either a lump sum or structured settlement. Structured settlements are those that are made over a time frame rather than a single payment and the amount received by the defendant is calculated to offset any existing VA benefits. In contrast, a lump sum payout will likely alter any existing benefits as the VA considers it to be income and will annually calculate it. In any case, if there are excess assets remain after the 12 month period when the settlement is annualized, Jim could be eligible for a new pension benefit, but only if his assets are lower than a threshold with which the VA determines to be a financial need.
Do I Need to Hire an attorney?
Many spouses, service members, and former spouses have questions about VA disability benefits and their impact on financial issues in divorce. Some people believe, among other things that Department of Veterans Affairs compensation payments can be split like military retirements in divorce cases, or that they’re «off limits» when calculating child support and Alimony. These misconceptions could lead to financial mistakes which can have serious consequences.
It is possible to submit an application for disability benefits yourself however, the majority of disabled veterans disability compensation (official source) would benefit from the assistance of a professional lawyer. A veteran’s disability lawyer can review your medical records to gather the evidence needed to prove your case before the VA. The lawyer can also file any appeals that you might require to receive the benefits you deserve.
Most VA disability lawyers don’t charge for consultations. The government will also pay the lawyer directly from the benefit of retroactive benefits. This is a benefit of the Equal Access to Justice Act. The proportion of retroactive past-due benefits your lawyer will be paid must be specified in your fee agreement. For example your fee agreement may state that the government will pay the attorney up to 20% of retroactive benefits or award. You will be accountable for any additional amounts.
Can I Garnish My VA Benefits?
If a disabled veteran receives compensation from the VA it is received in the form of monthly payments. The funds are meant to alleviate the effects of diseases, injuries or disabilities that have been sustained or aggravated by a veteran’s service. Like all income, the benefits for veterans disability lawyers with disabilities are subject to garnishment.
Garnishment is a legal action which allows a court decide that an employer or a government agency to take money from the paycheck of a person who owes money and transfer them directly to an individual creditor. In the event of divorce, garnishment may be used to pay child or spousal care.
However, there are a few situations in which a veteran’s disability benefits may be garnished. The most frequent scenario involves veterans who have waived their military retirement in order to claim disability compensation. In these instances the part of pension that is devoted to disability benefits can be garnished to pay for family support obligations.
In other circumstances, veteran’s benefits can also be garnished to pay medical expenses or federal student loans that are past due. In these situations the court may be able to go straight to the VA to obtain the necessary information. It is important for disabled veterans to work with a reputable attorney to ensure that their disability benefits are not garnished. This will allow them to avoid having to depend on private loans and payday lenders.
Can I Represent Myself in a Divorce Case?
VA disability settlements can be a huge assistance to veterans disability litigation and their families. However they also come with certain complications. For instance in the event that a veteran gets divorced and is awarded an VA disability settlement, they must be aware of what this means for the benefits they receive.
In this context one of the major issues is whether disability payments are considered assets that could be divided in a divorce. This issue has been addressed in a couple of ways. A Colorado court of appeals ruling decided that VA disability payments were not property and therefore could not be divided this manner. The other way is by the U.S. Supreme Court ruling in Howell which held that garnishing a veteran’s VA disability benefits to pay Alimony is against the Uniformed Services Former Spouses Protection Act (USFSPA).
Another concern with this topic is the treatment of disability benefits to children for maintenance and support. Both the USFSPA, and the Supreme Court, prohibit states from utilizing disability benefits as income. However, some states have taken the opposite approach. For instance, Colorado adds up all sources of income to determine the amount in support a spouse is entitled to and then adds disability payments to take account that they are tax free.
Additionally, it is essential for veterans to understand how their disability compensation will be affected if they are divorced and how their spouses’ ex-spouses could take advantage of their benefits. By knowing about these issues, veterans can protect their income and avoid unintended consequences.