Divorce can be contentious enough, but when it comes to the division of marital assets, things can get cutthroat. Veterans Administration disability benefits are intended to support a disabled veteran who cannot work or work to his full potential. The benefits provide compensation for a loss that the veteran suffered and they are not supposed to be part of the marriage assets. However, divorce lawyers across the country have succeeded in recent years in convincing judges to grant spouses who aren’t disabled a portion of their disabled spouses disability benefits.
Protecting Disability Benefits
Federal law specifically prohibits the granting of VA disability compensation to a spouse as part of divorce proceedings. The U.S. Supreme Court has also upheld this law, saying that only a veteran’s disposable retired pay -- the difference between a veteran’s retired pay and disability benefits -- can be divided up in a divorce. This has not stopped state judges from either ignoring this prohibition or misinterpreting it.
Military Disability Retired Pay
If a service member is injured to the extent where he can’t perform his duties, the service member may be placed on the “disability retired” list if he has enough creditable service hours. He will also begin to receive disability retired pay. The amount will be either what the service member is due in retirement pay (active duty base pay X years of service X 0.25) or disability pay (active duty base pay X the service member’s disability rating). If the disability pay amount is greater, then none of it can be garnished in a divorce. If the retirement pay is greater, then only the difference between the retirement pay and disability pay can be garnished.
VA Disability Compensation
If the service member begins drawing retirement first and paying alimony and is then approved for VA disability, the same rules apply. If the disability pay is higher than the retirement pay, then the service member will begin receiving the higher amount. The former spouse is only eligible for the difference between the two types of pay if the retirement pay remains the higher amount. Either way, unless the spouse has a provision in her divorce agreement to require any pay that's lost because of disability pay to be made up, then she will see her alimony reduced by a large portion of the amount of disability pay that the service member is receiving.
Operation Firing For Effect is an organization that is working to try and stop state courts from garnishing the disability pay of service members. In some cases the service member has gone to jail for contempt for refusing to pay something he can’t legally be required to pay. As of May 2011, federal agencies have been reluctant to step in and enforce their own laws.