Strange Va Letter About Severance Pay Recoupment

[MadMav]

I need a little advice from the crowd.

I am service rated at 80%, but received severance pay for degenerative joint disease at 20%. I have been repaying this pay at 20% of my monthy disability pay. Scheduled out to 2041 for repayment. This is to pay back the total of the severance pay minus Federal Tax withholding. But it now seems they are adding that into the mix now and wanting to repay the total??? I was under the impression this could not be done after Sep 30 1996(I was discharged in 2009).

I just received a letter stating....

"We are proposing to extend the withholding for your disability severance pay. Accordingly we propose to begin withholding all of your VA Compensation until your disability severance pay allowance is paid back."

Yet below that statement in the "revised" comenstion payment chart of the letter it still has me receiving my benefits, minus the adjusted 20% withholding(guessing for the cost of living raise we got). Still all the way until 2041.

It appears from the statement that they are going to withhold ALL of my disabilty compensation, but the revised compensation chart does not reflect this in any way.

My question is this.......can they withhold ALL of my disability compensation or is there a percent they can go up to? Like the 20% it is now? If they can and are going to do this(I intend to call them), how can I fight it? We have been receiving this disability for nearly 3 years now and have came to depend on it. Thank you for any help you can provide!

Mav

[MadMav]

It is the part of he has to pay back the severance pay he got for this medical at 20%. They can only take back at the % for at disablity he had from the service.

The law also covers the tax he gets back as when he gets his SC from the VA. there is a court case on this of getting the tax back. The lump sum should have still been the same as the per tax no matter what. the tax return has no play into this.

Is there a law or reg or something stating that they can only take back the % that I got my medical for from the military?

Mav

[carlie]

Is there a law or reg or something stating that they can only take back the % that I got my medical for from the military?

Mav

Here's the instruction for your issue :

Go to the link below:

http://www.benefits....MS/M21_1MR3.asp

Scroll down to :

Chapter 4 - Elections, Waivers, and Recoupments

Click on:

Section B

- Recoupment of Readjustment, Separation, and Severance Pay

[MadMav]

So this is what I took away from that link......

(3) Severance pay. Where the disability or disabilities found to be service-connected are the same as those upon which disability severance pay is granted, or where entitlement to disability compensation was established on or after September 15, 1981, an award of compensation will be made subject to recoupment of the disability severance pay. Prior to the initial determination of the degree of disability recoupment will be at the full monthly compensation rate payable for the disability or disabilities for which severance pay was granted. Following initial determination of the degree of disability recoupment shall not be at a monthly rate in excess of the monthly compensation payable for that degree of disability. For this purpose the term “initial determination of the degree of disability” means the first regular schedular compensable rating in accordance with the provisions of Subpart B, Part 4 of this chapter and does not mean a rating based in whole or in part on a need for hospitalization or a period of convalescence. Where entitlement to disability compensation was established prior to September 15, 1981, compensation payable for service-connected disability other than the disability for which disability severance pay was granted will not be reduced for the purpose of recouping disability severance pay. Where entitlement to disability compensation was established on or after September 15, 1981, a veteran may receive disability compensation for disability incurred or aggravated by service prior to the date of receipt of the severance pay, but VA must recoup from that disability compensation an amount equal to the severance pay. Where payment of severance pay was made on or before September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of the severance pay. Where payment of severance pay was made after September 30, 1996, VA will recoup from disability compensation an amount equal to the total amount of the severance pay less the amount of Federal income tax withheld from such pay. For members of the Armed Forces who separated under Chapter 61 of title 10, United States Code, on or after January 28, 2008, no recoupment of severance pay will be made for disabilities incurred in line of duty in a combat zone or incurred during performance of duty in combat-related operations as designated by the Department of Defense. (Authority: 10 U.S.C. 1174(h)(2) and 1212(d))

I'm guessing through all the fancy talk this means they only take the percentage that was originally given for severance pay. I'm I reading that correctly then?

Thank you all for the help too!

Maverick

[carlie]

I'm guessing through all the fancy talk this means

they only take the percentage that was originally given for severance pay.

I'm I reading that correctly then?

Maverick

Yes, just as sharon posted as a reply yesterday.

[MadMav]

Sorry, and thank you.

Maverick