Will The VA Cut Disability Pay Based On Income?
The United States may be the biggest economy in the world, but it’s dealing with a huge deficit. As of the beginning of fiscal year 2023, the deficit has reached nearly $723 billion. That’s a huge amount of money.
Of course, this number is alarming and we need to try to find ways to get it down to a more manageable amount. So the Congressional Budget Office has been brainstorming possible options for reducing this federal deficit. The most controversial idea is that the government could save $253 billion over the next decade by eliminating disability benefits for veterans who earn more than $170,000. This calls for means-testing for veterans with higher incomes. As you can imagine, the response was not positive.
So how would this work? According to the proposal, starting in 2024, military members would only receive their full disability payments if their annual household income was below a certain level. Disability benefits would be phased out for veterans with income above a certain threshold. For every additional two dollars of gross household income, disability compensation would decrease by one dollar. Veterans whose gross household income was $170,000 or higher in calendar year 2023 would no longer receive any disability compensation from the Department of Veterans Affairs (VA).
So is the VA on board with this? Absolutely not, so if you’re a veteran, you don’t have to worry. The VA shot down the proposal, claiming that it’s not a good idea. The VA has not even been approached by anyone on Capitol Hill about the proposal, so it’s a safe bet that a disability pay cut will not happen anytime soon.
While there were other options on this list created by the Congressional Budget Office, cutting VA disability compensation was the most controversial. But why are veterans — those who have sacrificed their lives for this country — being targeted? Analysts say disability compensation for veterans has increased substantially faster than inflation, both in terms of total spending and per veteran. In 2021, the VA paid $110 billion — four times the amount in disability compensation — than it paid in 2000. This is despite the fact that the number of vets in the United States had declined by more than 30%.
Are veterans making too much money? Roughly 1.5 million of 5 million veterans receiving disability benefits had household income that exceeded the 2023 threshold of $125,000. It is estimated that reducing or eliminating VA disability benefits for households whose gross household income exceeded this threshold would decrease spending by $253 billion by 2032.
Learn More About Veterans Benefits
The country is dealing with a huge deficit, but is cutting back on veterans benefits the right thing to do? No, it’s not. There are many other ways to cut back.
Get the benefits you deserve with help from a White Plains veterans disability benefits lawyer from The Law Office of Michael Lawrence Varon. We have represented clients at all levels of the veterans benefits system. Schedule a free consultation today by calling 914-294-2145 or filling out the online form.