Can VA Disability Claims Be Garnished?

Veterans struggling to afford daily living expenses can benefit from disability compensation from the U.S. Department of Veterans Affairs (VA). Veterans who can’t work due to an injury or illness rely on these monthly checks to cover living expenses and support their families. Many veterans depend on these disability benefits and they might find themselves wondering, can VA benefits be garnished? The short answer is that it depends.

If you’re a veteran who receives VA disability benefits, it’s essential to know when these benefits may be garnished. The caring disability attorneys at Disability Law Group focus exclusively on helping veterans and other individuals with disabilities secure the benefits they deserve. We are proud to serve veterans throughout Michigan. If you have questions about VA disability garnishment, contact our Michigan office.

What Is Garnishment?

Garnishment is when a creditor withholds part of a person’s earnings to pay a debt or other financial obligation. For example, a credit card company may ask the court to garnish the wages of a debtor who stopped making payments on their card, though they will need a court order to do so. Once they receive this court order, they can inform someone who holds the debtor’s property (like their bank or employer), and that person will transfer the creditor the funds directly. The IRS can garnish a taxpayer’s wages to collect outstanding taxes and doesn’t need a court order to do so. A percentage of each paycheck will be deducted until the creditor receives payment in full.

Can VA Disability Benefits Be Garnished?

The U.S. Department of Veterans Affairs typically won’t garnish disability benefits for certain financial obligations, such as creditor claims and unpaid taxes. However, specific circumstances allow for the garnishment of benefits.

So, can VA disability be garnished? Ordinarily, creditors cannot garnish VA disability benefits for medical bills, taxes, student loans, or other debts. However, VA disability benefits might be garnished if the veteran does not make their required alimony or child support payments.

Who Gets to Decide if a Veteran’s VA Disability Benefits Can Be Garnished?

Although a state administrative agency or judge might issue an order for garnishment, they are not the ones to decide whether to garnish disability benefits and, if so, how much. The VA determines whether a veteran’s benefits should be garnished and the amount that would be reasonable to pay back the money the veteran owes.

Rules of Garnishing VA Disability Benefits

Typically, VA disability benefits may be garnished only if the veteran receiving the benefits has waived military retired pay to get VA disability benefits. The VA can garnish only the portion of the compensation used in place of military retired pay. The debtor is prohibited from garnishing the remaining amount.

How Will VA Disability Garnishment Take Place?

If a veteran’s benefits are subject to garnishment, the VA will follow the rules in the Code of Federal Regulations (CFR) for garnishment. A finance officer and the Veterans Service Center (VSC) will work together to withhold the required amount of compensation and make the necessary payments according to the court order.

Typically, disability garnishment follows this process:

  • The court sends a garnishment order to the VA regional office for a veteran receiving disability benefits
  • The regional office provides the local finance officer with a copy of the court order
  • The finance officer reviews the claim to decide how much should be withheld and informs the veteran of the upcoming garnishment
  • The veteran receives a copy of the garnishment order from the financial officer with a description of the garnishment process and the monthly amount decided
  • The Veterans Service Center begins withholding the specific garnishment amounts from the veteran’s disability checks

Factors the VA Uses to Determine How Much of the VA Disability Compensation Can Get Garnished

To determine how much of the eligible disability compensation to garnish, the VA considers various factors, such as:

  • Whether the veteran’s particular needs require additional income
  • Whether the veteran’s former spouse or children have special needs requiring another source of compensation
  • The amount of income a former spouse or dependents already receive
  • Whether the veteran has other income sources

The VA typically allows only 20 to 50 percent of benefits to be garnished for child support or spousal support. Anything below 20 percent is considered too little to be helpful to dependents, while anything above 50 percent can cause hardship to the veteran.

So can you garnish VA disability?

If garnishing VA disability benefits would cause undue financial hardship for the veteran, the answer is no. Other circumstances that would likely prevent garnishment include:

  • The veteran’s ex-spouse lives with someone else and has a romantic relationship with them
  • A state court found the veteran’s former spouse guilty of infidelity
  • The veteran’s ex-spouse or child didn’t file for apportionment

Contact a VA Disability Attorney

Many veterans depend on VA benefits to live comfortable lives after a career of service to their country. Losing a portion of these benefits can significantly affect a veteran’s finances if they depend on them to pay their daily living costs.

Disability Law Group is proud to advocate for the rights of sick and injured veterans throughout Michigan. We have extensive experience and a proven track record of success in handling disability cases. Our caring disability attorneys are prepared to do whatever it takes to pursue the benefits you’re entitled to. Let us handle every detail of your case so you can focus on healing and rebuilding your life.

Contact us today to speak to a skilled and trusted disability attorney. We can evaluate your case and discuss your legal options.