As much as you need and deserve the VA disability benefits you receive, they can also complicate your overall financial picture. Many disabled veterans wonder how their benefits will affect income taxes, child support obligations, and more.
Good News Regarding VA Benefits and Taxes
If you are worried about paying taxes on your VA disability benefits, you can breathe a sigh of relief. These benefits are not taxable on the state or federal level. This tax-free status applies to your disability payments as well as grants for items such as wheelchair ramps in your home or motor vehicle adaptations to accommodate your disability. While you do not have to report VA disability benefits on your tax returns, you must file a return if you have taxable income from other sources.
If you were taxed on disability income in the past, you may be entitled to a refund under The Combat-Injured Veterans Tax Fairness Act of 2016. An experienced veteran’s claim attorney can help you understand how the law applies in your unique circumstances.
For a free legal consultation, call 800-562-9830
Ways That VA Disability Benefits May Be Counted as Income
Even though your VA disability benefits are not taxable, government entities may consider them income for other purposes. These include:
Other Assistance Programs
If you receive or are seeking assistance from other government programs, the administrators of these programs may consider your VA disability benefits in determining your eligibility.
For instance, a need-based program such as Supplemental Security Income (SSI) is based on your total income, including VA disability benefits. The Social Security Administration will consider the amount of VA disability benefits you receive in determining if you are eligible for SSI benefits and, if so, the amount of benefits you receive. Social Security Disability Insurance (SSDI), on the other hand, is not need-based. Your VA benefits will not affect your eligibility for assistance under that program.
VA disability benefits may also affect your household’s eligibility for low-income housing, SNAP benefits, and other need-based state and federal government assistance programs. If you are applying for any government program with or without income requirements, it is important to know the precise set of rules that govern eligibility for that program.
If you have any questions regarding government assistance and how your VA disability benefits affect your eligibility, talk with an attorney with experience in this unique area of law. You don’t want to run afoul of eligibility and income reporting rules. At the same time, you don’t want to miss out on benefits that could help you make ends meet during this difficult time.
Child Support and Alimony
Generally speaking, VA disability benefits are considered income in calculating child support, and may be considered income in regard to calculating alimony/spousal support payments.
Child support and alimony calculations are governed by the state you live in. By applying your state’s rules and evaluating your specific financial circumstances, we can help you determine to what extent these family law issues will impact your VA disability payments.
Can My VA Disability Benefits Be Garnished?
The rules regarding garnishments for child support and alimony are also based on state law. Generally speaking, the law makes it difficult to garnish a veteran’s disability benefits, but there are some situations in which a garnishment is deemed appropriate.
The VA will consider a number of factors in determining if your benefits are subject to garnishment. These factors include:
- Whether or not you have other sources of income
- The amount of income available to your ex-spouse or partner
- Special needs of the children receiving support
- Whether the garnishment would inflict undue financial hardship on you
VA disability benefits are designed to provide financial support for a disabled veteran and his or her family. For this reason, it may be appropriate that some of your benefits go toward the support of a child or ex-spouse. The outcome must be fair to you as well, which is why it is important to obtain legal counsel if you feel your rights are in peril.
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MARC WHITEHEAD & ASSOCIATES WILL FIGHT FOR YOU.
We understand that every day, week and month counts until your disabilities are properly rated and compensation is received. Since 1992, our firm has been representing injured and disabled people. Our commitment is to those who have served our country, and our veterans’ benefit lawyers and supporting staff will work hard on your claim. When you’re stuck, frustrated, underrated—our VA accredited attorneys are here for you. Call us today for a free case evaluation, 800-562-9830.
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