Veterans are eligible for monthly disability compensation that is tax-free if they have a disability rating allocated by the VA for a service-related condition (“Determining disability rating”). These benefits vary from $117 to $2,527 per month as of 2008 contingent upon the level of disability.
Compensation for dependents such as spouses and children is also available with the exception of a rating of 10 or 20 percent disabled. And, in the case a spouse is severely disabled, requiring additional assistance (A/A) at home, more compensation may be distributed.
Figuring monthly rates
Veterans rating 30 percent or more have rates increased in regard to the number of dependents they have, as monthly disability compensation is largely reliant on disability rating.
A veteran rated at 10 percent disabled can receive $117 per month, whereas a veteran rated 20 percent disable can receive $230 per month.
Table 6-2 shows rates for veterans without children. Table 6-3 shows rates for veterans with children.
(TABLE 6-2: Disability Compensation for Veterans without Children (2008))
|TABLE 6-2||Disability Compensation for Veterans without Children (2008)|
(TABLE 6-3: Disability Compensation for Veterans with Children (2008))
|TABLE 6-3||Disability Compensation for Veterans with Children (2008)|
Children are considered under the age of 18, or under the age of 23 if attending a college or university as a full time student. Children unable to care for themselves are included if the incapacity occurred before the age of 18, or 23 if enrolled in secondary education.
December 1 of each year the VA provides new rates for tables 6-2 and 6-3 to anticipate inflation. For up-to-date rates go to www.vba.va.gov/bln/21/Rates.
Special monthly compensation
Additional compensation, varying from $3,145 per month to $7,556 per month in 2008, are available to a veteran who sustained the loss or loss of use of particular organs or extremities during military service. This benefit is called special monthly compensation (SMC). Several conditions dictate the amount paid to the veteran such as the medical condition, combination of conditions, and any number of dependents.
An amputation or lack of operative function of an extremity or organ constitutes what the VA considers loss or loss of use. Disabilities the VA may consider SMC are:
- Loss or loss of use of a hand or foot
- Immobility of a joint or paralysis
- Loss of sight or an eye (and retaining only light perception)
- Loss or loss of use of a reproductive organ
- Complete loss or loss of use of both buttocks
- Deafness in both ears (lack of air and bone conduction)
- Inability to communicate with speech (total organic aphonia)
- Loss of a percentage of tissue from a single breast or both breasts from mastectomy
- Radiation treatment
Groupings of these disabilities demand higher pay rates from the VA. This can include loss or loss of use of feet, legs, hands, and arms, in particular financial increments, based on the combination of the disabilities. Particular combinations of severe deafness and bilateral blindness may also qualify for higher pay rates.
A service-related disability of 100 percent can constitute SMC provided the veteran is housebound, bedridden, or requiring aid and attendance.
SMC rates are available at www.vba.va.gov/bln/21/Rates/comp02.htm.
SMC charts includes codes like SMC L and SMC N that correspond with special disabilities listed under federal law in United States Code (USC). These codes are viewable with Title 38, Section 1114 at www4.law.cornell.edu/uscode.
In 2004 Congress sanctioned concurrent receipt making it possible for veterans to receive the maximum amount of their military retired pay (detailed in Chapter 7) and the maximum amount of any applicable VA disability compensation. In the past a military retiree was required to waive a reciprocal amount of their retirement pay in order to obtain VA disability compensation.
The change, made by Congress in 2004, only applies to veterans who have service-related disability ratings of 50 percent or higher. Those with ratings 50 percent or less are required to waive a reciprocal amount of their military retirement pay in order to obtain compensation.
If a military veteran must waive military retirement pay in order to garner VA disability compensation, their retirement pay is taxable whereas disability compensation is not.
Concurrent receipt initiated by Congress has not been completely implemented. The percentage of military retirement pay exempt from concurrent receipt restriction is extended in yearly increments. The maximum amount of military retirement pay will be exempt in 2014.
Combat-Related Special Compensation
Combat-Related Special Compensation (CRSC) is a government program under which a veteran can be awarded a monthly special pay intended to lessen or eradicate the offset of military retirement pay. The veteran must have sustained a combat-related disability to be eligible for CRSC.
To qualify for CRSC, the individual military service the veteran served as a part of—not the VA—elects whether they meet criteria or not.
A veteran qualifies for monthly CRSC payments if they are issued military retirement pay (detailed in Chapter 7), and a disability has developed in direct relation to:
- Armed conflict (gunshot wounds, Purple Heart)
- Simulated war training (exercise, field training)
- Perilous duty (flight, diving, parachute duty)
- Instrumentality of war (combat vehicles, weaponry, Agent Orange or other hazardous agents)
The approved quantities of monthly CRSC payments for 2008 are displayed in Table 6-4, and, analogous to VA disability compensation, CRSC payments aren’t subject to income taxes.
(TABLE 6-4: Monthly CRSC Payments (2008))
|Table 6-4||Monthly CRSC Payments (2008)|
|Combat-Related VA Disability Rating||Monthly CRSC|
Veterans can’t receive a payment that surpasses the amount of full retirement pay they would be allotted to excluding the offset because the CRSC aims to lessen or eliminate the concurrent receipt restrictions.