- Military veterans vs. military retirees
- Are VA disability benefits considered marital property?
- Can VA benefits be used to pay spousal support or child support?
- Can VA benefits ever be garnished?
The divorce process is fraught with legal, logistical, and emotional challenges. When you’re part of a military family, this can complicate the divorce proceedings as well as your post-divorce life. There are special considerations for veterans both during and after divorce.
Military veterans vs. military retirees
First, let’s clear up a definition that’s sometimes overlooked. “Military veterans” and “military retirees” are two different servicemember populations.
Military veterans are those who served in the armed forces, navy, or air force and have been released through a discharge other than dishonorable. They are eligible for Veterans Affairs (VA) benefits. This may be especially important for those who were injured during their service.
Military retirees are those who retired from military service after 20 or more years of active duty. Even though military retirees are still technically veterans, they don't receive retirement care through the VA, though they still get benefits through the Department of Defense and medical care through TRICARE.
Military retirement pay
Another difference between these two populations is that military retirees may be able to receive retirement benefits after getting divorced. This can be an important source of income for them and their families. Military veteran spouses may not be able to receive retirement pay after getting divorced, depending on their separation status.
Military pension plans
Military retirees may be more likely to have pension plans through the military that can be divided during a divorce. For the most part, these benefits are subject to distribution in divorce. Because military retirees receive these benefits after decades of service, like any other long-term job, their former non-military spouses are eligible for at least a portion of those assets.
The same does not hold true for military veterans and their spouses. Veteran benefits only stick with the veteran in a divorce; the non-military ex-spouse loses their veteran benefits upon divorce.
If you or your spouse have served in the military, you may want to meet with an expert who specializes in military finances. Our CDFA, David Smith, specializes in military divorce and finances. Book an appointment or read his bio here.
Are VA disability benefits considered marital property?
No. While married, military spouses and dependent family members enjoy eligibility for VA benefits. Upon death, surviving spouses retain those VA benefits. But the VA treats divorce differently. Upon divorce, VA benefits are not subject to marital property division. They cease for everyone except the military veteran and their dependents.
However, a court can use a veteran’s VA benefits to calculate how much their support obligations would be in divorce proceedings. Even if a veteran’s VA benefits cannot be garnished (more on that below), most state laws allow judges to consider VA benefits as income when determining how much a spouse might need to pay in spousal support or child support each month.
If you don't have much income other than your VA benefits, you're likely to need to use some of your VA benefits to pay your support obligations. While there are different considerations for spousal support versus child support, it's a good idea to prepare by setting aside some VA benefits to cover these payments.
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Can VA benefits be used to pay spousal support or child support?
Yes. Once the money is in a veteran’s bank account, they can do with it as they choose. So, if you’re a veteran who has been ordered to pay alimony or child support, you can use your disability payments from the VA to pay your court-ordered costs.
VA benefits can also be apportioned. This is a process in which a former spouse specifically requests a portion of their ex’s VA benefits. The VA will not distribute your benefits without a formal request from a former spouse. Upon that request, the VA will conduct an analysis to determine whether apportionment is right.
Can VA benefits ever be garnished?
Military member veterans who receive benefits from the VA may have those benefits garnished to pay certain debts. For example, VA benefits can be garnished in order to pay federal taxes, child support, and other debts owed to the federal government. Why? Because the idea for the VA is to help veteran families, not just the veterans themselves. That said, VA benefits cannot be garnished for private debts, such as credit card bills or personal loans.
Furthermore, VA disability benefits cannot be garnished at all unless the veteran specifically waived part of their military retirement pay to receive VA disability benefits. If that's the case, only the amount of disability compensation the veteran receives in lieu of retirement compensation can be garnished. The rest of the disability payments are fully protected.
The amount of VA benefits subject to garnishment depends on whether the veteran has other sources of income or any special needs. If the veteran has no other income or has special needs requiring additional money, they'll likely not be subject to garnishment of their VA benefits – at least not a substantial portion. Whether the veteran has other dependents or a former spouse is also a consideration.
This generally works out to between 20% and 50% of VA benefits that can be garnished. Anything greater than that amount would likely cause undue hardship to the veteran. If VA benefits are being garnished for child support purposes where there is more than one child, an equal amount of the garnished sum will be provided to each child.
Here are some other scenarios where garnishment of VA benefits would not be allowed:
- The veteran's former spouse is living with another partner. If they are married, alimony would cease.
- The veteran’s former spouse was found by a court to have cheated during the marriage.
- The veteran’s child has been adopted. (This would reduce but not eliminate garnishment.)
If you or your spouse have served in the military, our CDFA, David Smith, specializes in military divorce and finances. Book an appointment or read his bio here.
Divorce, for anyone, is a huge life change. For military members and their families, it can feel overwhelming due to the special circumstances and rules involved. Hello Divorce can help you with your military divorce case. Schedule a free 15-minute phone consultation with one of our account coordinators to discuss which of our online divorce plans or services might best fit your needs.
