What happens to a Veteran’s Disability Compensation when they are incarcerated? Before we begin, let’s make sure that we are clear on a few things. The most important thing to consider is that there is a difference between serving time in jail, and serving time in prison. The biggest difference between the two is the length. Prison is usually a long-term stay to whereas jail is normally a short-term stay. I wouldn’t likely go to jail for a few days for murdering someone, and I likely wouldn’t go to prison for a public intoxication citation. For the most part, in order for the VA to reduce your benefits, you have to be convicted of a felony and incarcerated for more than 60 days.
Here is what to expect if you are incarcerated and receiving VA Disability Compensation: VA disability compensation payments are reduced if a Veteran is 
convicted of a felony and imprisoned for more than 60 days. Veterans rated 20 percent or more are limited to the 10 percent disability rate. For a Veteran whose disability rating is 10 percent, the payment is reduced by one-half. Once a Veteran is released from prison, compensation payments may be reinstated based on the severity of the service-connected disability(ies) at that time. Payments are not reduced for recipients participating in work release programs, residing in halfway houses (also known as “residential re-entry centers”), or under community control. The amount of any increased compensation awarded to an incarcerated Veteran that results from other than a statutory rate increase may be subject to reduction due to incarceration.
What if you’re receiving pension instead of VA Disability Compensation. The VA States that: Veterans in receipt of VA pension will have payments terminated effective the 61st day after imprisonment in a Federal, State, or local penal institution for conviction of a felony or misdemeanor. Payments may be resumed upon release from prison if the Veteran meets VA eligibility requirements. Failure to notify VA of a Veteran’s incarceration could result in the loss of all financial benefits until the overpayment is recovered.
There are some special considerations for family members too. The VA states: All or part of the compensation not paid to an incarcerated Veteran may be apportioned to the Veteran’s spouse, child or children, and dependent parents on the basis of individual need. In determining individual need, consideration shall be given to such factors as the claimant’s income and living expenses, the amount of compensation available to be apportioned, the needs and living expenses of other claimants as well as any special needs, if any, of all claimants.
If you’re facing incarceration, it can be tough to prepare yourself and your family for what to expect in advance. Knowing how your finances will be impacted can help alleviate some of those issues.
Pursuing a claim can be very frustrating. If you’d like to learn what an attorney can do for you, give Jan Dils, Attorneys at Law a call today for a Free consultation. The toll-free number is 1-877-526-3457. If you can’t talk now, fill out this form so that a representative can contact you at a better time.
