FYI, if you received any form of Severance Pay from the Military. The VA will recoup before you receive any compensation.

Cpl Tou Lee Yang — Sat, 15 Aug 2015 16:38:18 -0400

Just an FYI, I didn't know the answer until VA came calling. As it turns out ANY form of severance pay will be recoup before you receive any compensation.

Response by SPC Elijah J. Henry, MBA made Aug 15 at 2015 4:46 PM

SPC Elijah J. Henry, MBA — Sat, 15 Aug 2015 16:46:17 -0400

Good to know, thank you. I will keep this in mind for when I get to that stage of my career.

Response by MAJ Ken Landgren made Aug 15 at 2015 5:32 PM

MAJ Ken Landgren — Sat, 15 Aug 2015 17:32:02 -0400

Its not fair.

Response by CPL David Salazar made Aug 15 at 2015 6:22 PM

CPL David Salazar — Sat, 15 Aug 2015 18:22:46 -0400

Same happens with retirement pay for all retirees and drill pay for reservists.

Response by MSgt Curtis Ellis made Aug 15 at 2015 11:32 PM

MSgt Curtis Ellis — Sat, 15 Aug 2015 23:32:09 -0400

Wow... I wasn't aware of that. Definitely good to know!

Response by SSG Trevor Cornelison made Aug 17 at 2015 3:15 PM

SSG Trevor Cornelison — Mon, 17 Aug 2015 15:15:30 -0400

It will only be recouped if injuries were not due to combat.

Response by SSG Michael DeBerry made Oct 22 at 2015 1:54 PM

SSG Michael DeBerry — Thu, 22 Oct 2015 13:54:37 -0400

Service members can Fight this policy. You must contact your member of Congress and US Senator...

Response by Maj Matt Hylton made Dec 18 at 2015 1:59 PM

Maj Matt Hylton — Fri, 18 Dec 2015 13:59:21 -0500

This was explicitly stated to me as such on my separation paperwork. Really sucks when you think about it. "Here's some severance pay to help since we're involuntarily separating you due to force reductions - on a completely unrelated note that we are making related: if you ever do receive disability compensation through the VA or obtain a retirement through the Reserves or National Guard, you gotta pay that money back."

Response by CSM Michael Lynch made Dec 30 at 2015 3:07 PM

CSM Michael Lynch — Wed, 30 Dec 2015 15:07:57 -0500

I just read this posting today and it is very disappointing that those forced out lose no matter how you look at it.

Response by SSG Michael DeBerry made Jan 27 at 2017 8:53 PM

SSG Michael DeBerry — Fri, 27 Jan 2017 20:53:30 -0500

VETS WHO ACCEPT SEPARATION PAY CAN’T RECEIVE VA COMPENSATION By James Clark
on December 30, 2015

http://taskandpurpose.com/vets-who-accept-separation-pay-cant-receive-va-compensation/?utm_source=twitter&utm_medium=social&utm_campaign=share&utm_content=tp-share

Under federal law, until veterans pay back their involuntary separation pay, they can have their VA disability compensation withheld.

After 31-year-old Marine veteran Tim Foster received a 50% disability rating from the Department of Veterans Affairs in January, he was shocked to discover the compensation benefits would be withheld until May 2016.

The reason, Foster explained to Task & Purpose, is that he received $30,000 in involuntary separation pay from the Marine Corps when he was forced out in August 2014, due to personnel cuts. Foster said he accepted the separation pay, not realizing he would have to pay it back if he filed for disability.

And he isn’t alone.

In the last five years, the VA withheld more than $401 million in disability compensation from 24,988 veterans, with $261 million scheduled to be withheld from future benefits, according to Meagan Lutz, a spokesperson for the VA. The department’s public affairs office provided Task & Purpose with statistics breaking down these figures. [chart-original] The reason for this is due to 10 USC 1174, a federal law precluding duplication of benefits. The law requires that the VA recoup military separation benefits paid by the Department of Defense in cases where a veteran is subsequently awarded VA compensation, explained Terry Jemison, another spokesperson for the VA, in an email to Task & Purpose.

VA disability benefits can be withheld if a veteran receives readjustment pay, non-disability severance pay, separation pay, reservist involuntary separation pay, special separation benefits, voluntary separation pay, or disability severance pay.

The VA is required to withhold some or all of a veteran’s monthly compensation until this recoupment is complete. The process can take years, and for some veterans, like Foster, their benefits are still being withheld long after they’ve spent their separation pay.

Tim Foster in his barracks at Camp Lejeune in 2005 just before his second deployment to Iraq. [Photo courtesy of Tim Foster]

Tim Foster in his barracks at Camp Lejeune, North Carolina, in 2005 just before his second deployment to Iraq.

Foster, a combat veteran of the wars in Iraq and Afghanistan, served from June 2003 to August 2014 as an assaultman, before he changed jobs to be a missileman. Later, he spent three years as a recruiter before being separated as a sergeant.

Foster filed for disability benefits in October 2014 and since he was approved for compensation in January, he’s had his rating increased twice, first to 70%, and to 80%, where it stands now. Due to his health concerns, Foster said he is unable to work and with his disability benefits withheld until his separation pay is recouped, it puts him under financial strain.

After leaving the military, Foster moved from California to West Virginia, where he now lives and attends American Military University on the post-9/11 G.I. Bill. When he left the Marines, Foster spent three months looking for work, but in May of this year, he lost his job, and filed for individual unemployability.

It was also at this time that he began struggling with post-traumatic stress, he said. Although he is unable to receive compensation from the VA, he is still able to receive care.

“It doesn’t make any sense at all,” said Foster, who compared it to receiving a severance package after being laid off from a company, only to have social security require you to pay that money back. “Separation pay and disability pay come from two separate pots of money and they’re two totally separate things.”

As for the $30,000 in separation pay that he received? It’s long gone, said Foster, who explained that it went toward moving, housing, and living expenses.

“If I didn’t have to pay back that separation pay, I’d at least have something,” said Foster.

Vets Who Accept Separation Pay Can’t Receive VA Compensation

Under federal law, until veterans pay back their involuntary separation pay, they can have their VA disability compensation withheld.

Response by MAJ Private RallyPoint Member made May 22 at 2018 8:01 PM

MAJ Private RallyPoint Member — Tue, 22 May 2018 20:01:17 -0400

My husband was discharged from the army due to reduction in force and received separation pay. He then joined the army reserves and later got awarded VA disability. They have been recouping his separation pay for over three year. During these three years he has been receiving drill pay. Will he had to pay back all the drill money he has got?

Response by SSgt Bill Cleven made May 8 at 2019 10:46 PM

SSgt Bill Cleven — Wed, 08 May 2019 22:46:52 -0400

As someone who is currently having his disability payments taken away this whole thing seems like the biggest scam in the world. It is easy for the DOD to offer up these big fat separation bonuses knowing they will get most of it back on the back end because of disability claims. I did not file a disability claim until nearly a year after I got out. I thought disability payments are for injuries and illnesses during service AS WELL AS LOSS OF POTENTIAL for the rest of my life because of the disabilities. I am on the verge of losing everything because of recoupment of my disability. When you consider the harm that was done to my body I do not see how this can be considered double dipping.