OFFE NEWS

August 31, 2022

UNITED STATES CODE TITLE 42 CONGRESSIONAL EXEMPTIONS
[Veterans’ Disability Compensation]

Analysis by Simon Alvarado, MSW
Retired United States Army

It has become obvious that state civil courts, attorneys and the Department of Veterans Affairs (DVA) have joined forces in enforcing 42 United State Code TITLE IV- Grants to States for Aid and Services to Needy Families with Children and for Child–Welfare Services PART D - Consent By The United States To Income Withholding, Garnishment, And Similar Proceedings For Enforcement Of Child Support And Alimony Obligations.  The interesting part is that disabled veterans in receipt of disability compensation have been excluded from what is “money subject to process”, since 1975.  When Congress clarified the legislative language, thus avoiding confusion with § 659 that exempted disabled veterans who had not retired or in receipt of retire or retainer pay from any branch of uniformed services.  This congressional statutory protection clause¹ on veteran’s disability compensation ² remains unambiguous.  

Insofar, States considers discretionary (not remunerated for employment) source as income³ for the calculation of child and spousal support.  Contrary to 42 United States Code Part D § 659 it exempts a disabled veteran who has never received military retirement or retainer pay⁴ or a Veteran pension⁵ 5. The veterans’ service-connected disability compensation has always been determined by a governmental (VA) medical rating process⁶ that determines levels of impairment or injuries that may have resulted in loss of earning capacity.  Under 38 United States Code dependents are never part of the rating process, thus has no bearing on a rating outcome.
 

I. INTRODUCTION

By all applicable federal authorities veterans’ disability compensation is not remuneration income for employment, nontaxable income (as some might want to believe), or disposable income. State civil courts are prohibited from garnishing veterans’ disability compensation, unless certain conditions exist e.g., Title 5 CFR that pertains to government civil service employees.  Military service members (Enlisted/NCOs) of the Armed Forces and veterans are not employees of the Veterans Administration or any other federal employer.

The federal law is the most definite argument when defining who is an employee of the government or civil service.  Section 2101 of Title 5 (1) The “Civil Service “consists of all appointed positions in the executive, judicial and legislative branches of the government of the united States, except positions in the uniformed services.

Under section 2105 of Title 5 an “employee”, means an officer and an individual who is appointed in the civil service by one of the following acting in an official capacity a member of a uniformed service on active duty.  Voluntary enlisted military service members are considered Enlisted or Non commission Officers (NCO), thus not appointed.

II. United States Health and Human Services

The mission of the U.S. Department of Health and Human Services  (USHHS) is to enhance the health and well-being of all Americans, by providing for effective health and human services and by fostering sound, sustained advances in the sciences underlying medicine, public health:

42 U.S. Code sec. 659 (h)(1)(A)(V) - by the Secretary of Veterans Affairs as compensation for a service-connected disability paid by the Secretary to a former member of the Armed Forces who is in receipt of retired or retainer pay if the former member has waived a portion of the retired or retainer pay in order to receive such compensation.

III. CONGRESSIONAL EXCEPTION

In 1975 Congress to avoid confusion made an exception that coincides with a non-wavering authority in 42 United States Code § 659 on “moneys subject to process” for child support and alimony.  It is also noted that nowhere in Title 38 does it make any provisions for child support or alimony.  A simple reason, disability compensation benefits belong wholly to the veteran.  The rating process is reliant on only one simple factor, were injuries claimed service connected?  Families are not considered in the rating process.  Any additional compensation benefits for family members are considered after a rating have been established and if the rating is 30% or higher at which point the veteran may apply for additional dependency compensation for dependents⁷. 

IV. CONSEQUENCES OF ADDITIONAL DEPENDENCY COMPENSATION

Divorce resulting from military service has been epidemic and shows no sign of improving.  In recent years multiple deployment has put a big strain, not only families but service members who return with severe physical injuries and traumas related conditions.  For veterans with service connected compensation ratings dependents are eligible for additional benefits⁸.   While there may be a positive financial advantage there may be some risks involved in losing more than what a veteran receives during the marriage.  Health care may be a determining factor for those rated at the maximal rating during the marriage.

It may be a coincident but the VA’s standards of apportionments looks very similar to state guidelines in determining Court child support orders. 38 CFR Section 3.451⁹ – special apportionments in part the amount apportioned should generally be consistent with the total number of dependents involved. Ordinarily, apportionment of more than 50 percent of the veteran's benefits would constitute undue hardship on him or her while apportionment of less than 20 percent of his or her benefits would not provide a reasonable amount for any apportionee. 

These percentages reflect similar ones for state mandated guidelines.  The VA considers no less than 20% which may not be reasonable, yet the amount paid to a veteran only represents 3.6% (100% rated) after a divorce in additional compensation.  So, how can this not be considered child support?  It looks like this additional dependency compensation is more of a scam, since more is taken than given after a divorce.  The 3.6% is considered reasonable to support one child during the marriage but nor reasonable after a divorce, actually a reduction..  This is only if a veteran choses additional dependency benefits.  It would make sense that benefits cannot be apportioned, if the veteran has not chosen any additional dependent benefits.

The Department of Veterans have been complicit  in turning their back on disabled veterans by claiming that veterans are employees of the VA, thus garnishing disability compensation under  5 CFR § 581.103 - Moneys which are subject to garnishment, even though the federal laws are clear on who is an employee.  
It is noted that U.S. Code 38 § 5301 prohibits any garnishment, attachments, seizures or levy, unless the veteran is indebted to the federal government for any over payments or likewise; apportionments are based on financial needs for veterans’ families, but only if veteran is receiving additional dependency benefits.
 

V. IN CONCLUSION

• The analysis on whether states are allowed to use veterans’ disability compensation as income for support, the supremacy clause must be adhered. States are prohibited in legislating policies, mandates, or any authorities that undermines the sanctity of the rule of constitutional (Congressional) law.
• Based on the analyses of federal laws on “what is and what is not” subject to process, State civil courts do not have subject matter jurisdiction over disabled veterans federal compensation benefits,  Such jurisdiction falls within the purview of the Secretary of the Veterans Administration. 
• A long standing (1975) rule remains steadfast in the congressional exception under 42 U.S. Code Title IV Part D, unless a disabled veteran who has not retired from the military Armed Forces is not to be treated, as a military retiree who has waived retired or retainer pay for veterans disability compensation, which is subject to garnishments, but only disposable pay (Title 10 §1408). 
• Military Armed Forces and veterans do not share the same status as “employees” of the federal government. Disabled veterans are not employees of the VA or any other federal agency, unless they have waive part or all of retire or retainer pay for veterans’ disability compensation.
• Apportionments are not designed to seize compensation for child support or any support, unless the veteran accepts additional dependency benefits, and only if financial needs can be determined, otherwise an apportionment cannot be granted, as long as the veteran is providing¹⁰ for his children.
• 42 U.S. Code Title IV Part D exempts non - retired military service members from State Courts when using disability compensation as “money subject to process” for child support or alimony orders. 
• The Department of Veterans Affairs Office of General Counsel is indiscriminately labeling disabled veterans “employees”, contrary to federal statutes, in order to collude with States Child Support Enforcement efforts through apportionments.

Operation Firing For Effect (OFFE) is a bipartisan Veterans Advocacy group, and subsidiary of Veterans For Veteran Connection, Inc., a 501(c)19 non-profit corporation devoted to the protection and improvement of entitlements and services earned by our men and women in uniform. 
 
 
OFFE does not endorse political candidates running for office. OFFE does report on issues of importance to our former military personnel and their families and that includes News from both sides of the aisle. OFFE will grant equal time to any candidate (regardless of political affiliation) who wishes to share and explain their position(s) on Veterans Affairs.