Tax-free monthly payment for service-impaired health. Not based on income, not based on whether you can work, not the same as retirement or SSDI. Rated 0–100% in 10-point increments. Most first-time claims get denied because of a missing nexus letter — fixable with a Supplemental Claim.
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What VA disability compensation is
VA disability compensation is a tax-free monthly payment made to veterans whose health has been impaired by their military service. It is not a pension and it is not based on need. It is paid because the United States government agrees that something happened to you while you served, and that something is still affecting your life today.
The amount you receive is governed by your combined disability rating, expressed as a percentage from 0% to 100% in increments of 10%. A higher rating means a higher monthly payment, plus access to a widening set of collateral benefits at certain thresholds — see What each rating unlocks.
What it is NOT
- Not based on whether you can work. Most rated veterans work full-time. (Exception: TDIU — see TDIU.)
- Not based on your income. No means test for service-connected compensation.
- Not taxed. You do not report it on your federal tax return.
- Not the same as military retirement. If you retired, you may receive both, sometimes offset.
- Not the same as VA pension (a separate needs-based program for wartime veterans).
- Not the same as SSDI, though many veterans qualify for both.
Why VA says no
VA denies most first-time claims. This is not because most claims are fraudulent — it is because most first-time claims are inadequately documented. The single most common reason for a denial is a missing nexus: the veteran has a current diagnosis and proof of in-service events, but did not submit a medical opinion linking the two.
The fix: the nexus letter.
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