VA Disability & Child Support: What Can Be Counted or Garnished (2026)
VA disability compensation is income for child support in most states but is protected from garnishment — except the portion received in lieu of waived retirement pay (42 U.S.C. § 659). CRSC, CRDP, and the Howell rule explained.
For veterans, the child-support rules split along one line: VA disability compensation is <em>counted as income</em> for calculating support in most states, but it is <em>protected from direct garnishment</em> — with an important exception for the portion received in lieu of waived military retirement pay.
VA disability counts as income for support
Even though VA disability compensation is tax-free and protected from creditors generally (38 U.S.C. § 5301), courts in most states include it in gross income when setting child support — it is a real, stable income stream. States such as Maine and South Carolina treat it as income for support purposes (Maine: 19-A M.R.S.A. § 2006; SC: S.C. Code Ann. § 63-17-470). A disability rating change is a material change of circumstances supporting modification.
Garnishment: protected, with a key exception
38 U.S.C. § 5301 protects VA disability payments from seizure by creditors. But 42 U.S.C. § 659 carves out child support: VA disability compensation paid <em>in lieu of waived military retirement pay</em> is treated as if it were retirement pay and can be garnished for child support and alimony. This matters enormously because many retirees waive retirement to receive tax-free VA disability — the waiver does not shield the money from a support order.
CRSC and CRDP
Combat-Related Special Compensation (CRSC) is tax-free combat-disability pay that is not retired pay but is garnishable for child support and alimony. Concurrent Retirement and Disability Pay (CRDP) restores full retired pay for retirees with 20+ years of service and a 50%+ VA rating — since it restores the waived retirement, the full restored amount is disposable retired pay and fully subject to garnishment.
Division in divorce: the Howell rule
VA disability cannot be divided as marital property — the U.S. Supreme Court held this in Mansell v. Mansell (1989) and reaffirmed it in Howell v. Howell (2017), ruling that state courts cannot order a veteran to indemnify a spouse for the amount of retirement waived to obtain VA disability. Courts may still consider disability income when setting child support and alimony, and may adjust other assets in property division.
Chapter 61 (medical) retirement — 2026 update
For years DFAS took the position that Chapter 61 (medical) retired pay was not divisible, even where CRDP applied. After a 2022 DoD Claims Appeals Board decision and a 2023 DFAS regulation rejecting it, DoD reversed course in February 2026: Chapter 61 retired pay paid concurrently with VA disability compensation under 10 U.S.C. § 1414 is now expressly recognized as divisible disposable retired pay under USFSPA (DoD FMR Vol. 7B, Ch. 29, ¶ 7.2, Feb. 2026 ed.). This restores pension shares for spouses of medically retired veterans.