Military Retirement Pay and VA Disability Compensation Benefits
February 2, 2016 in
In the past, the VA did not allow veterans to receive full military retirement pay and full VA disability compensation benefits. For some vets, it was necessary either to waive a portion of retirement pay or waive a portion of disability compensation benefits, but the total amount between the two was always ultimately identical.
In other words, if you had $3,000 in retirement pay and $400 in VA disability benefits, you could opt to receive the full $3,000 in retirement pay and $0 in disability benefits, or you could opt instead to receive $2,600 in retirement pay and $400 in disability benefits; either way, you would still be stuck at $3,000 in the end. The only difference is that VA disability benefits are not taxable, so for tax purposes, the latter option was to a veteran’s tax advantage.
The rules for concurrent receipt of disability benefits and retirement pay underwent significant changes in 2002, 2005 and 2008. Through these changes, the VA now allows veterans who qualify to receive both VA disability compensation benefits and military retirement pay concurrently in certain situations:
- Retired veterans with at least 20 years of service who are 100 percent service connected (under a schedular rating or individual unemployability) may receive all of their retirement pay and all of their VA disability compensation benefits concurrently. There is no reduction required. 38 C.F.R. § 3.750 ( 2012).
- Retired veterans with at least 20 years of service who are 50 to 90 percent service connected are subject to a phase-in process and, according to 38 C.F.R. § 3.750 (2012), will eventually receive full concurrent receipt of both VA disability compensation benefits and military retirement pay starting December 31, 2013.Until this date, however, these veterans must file a waiver to receive the maximum allowable amount of disability benefits and retirement pay during the phase-in process. 38 C.F.R. § 3.750(c)(1)(ii); 38 C.F.R. § 3.750(c)(3) (A waiver can be “any written, signed statement, including a VA form, which reflects a desire to waive all or some military retired pay. The statement must be submitted to VA or to the Federal Agency that pays the veteran’s military retired pay.”).
- Retired veterans who retire based on years of service and are service connected with a “combat-related disability” or disabilities rated at 10 percent or more receive full military retirement pay and the amount of VA disability benefits attributable to the “combat-related disability” or disabilities. 10 U.S.C. § 1413a.
Veterans who were medically retired from the military under 10 U.S.C. Chapter 61 (regardless of number of years served) and are service connected with a “combat-related disability” or disabilities at 10 percent or more may be able to receive part of their military medical retirement pay and the amount of VA disability benefits attributable to the “combat-related disability” or disabilities. 10 U.S.C. § 1413a.
- If you have questions about how your military retirement pay and compensation benefits work, please call the Berry Law Firm at (888) 883-2483. Our office specializes in helping veterans who qualify to get the maximum amount of VA disability compensation benefits available to them.