Incarcerated Veterans Benefits

Scroll down to learn more about how incarceration may affect payment of veterans benefits as well as criteria for loss of payments.

Loss of Payments

A Veteran will lose payments when these criteria are met:

The beneficiary is incarcerated

The incarceration must be in a federal, state or local penal institution

Penal institution ran by a private entity under contract with the federal, state, or local government

The incarceration must be in excess of 60 days

And the incarceration must be as a result of a conviction of a felony (see penal code of felony conviction)


Pension benefits are disallowed completely for incarcerated veterans. Further, the family loses any apportionment of that benefit.


Incarceration of a service connected veteran does not void his or her service connected percentage

Only the amount of payment to the veteran changes

The complete rating payment may be resumed upon release from prison

Payments to family members will also be reduced

Any percentage paid to a veteran will be reduced to the 10% rate. The family may be apportioned that 10% payment.

VA Notification

It is very important that the VA be notified promptly of the commencement of incarceration and of any desire for the family to request an apportionment of the beneficiary’s benefits. Once the Veteran is released, the veteran or family member may request a reinstatement of the benefits.

If an overpayment was created, the VA will need to retain payment until all money owed is paid.

Request for Waiver of Overpayment

A waiver of overpayment may be requested. There is no deadline to dispute a debt; however there is a 180 day limit to request a waiver.

When a debt is created, VA (Pension Management Center) will send out a notice. The amount of the benefit will not be changed if the waiver is requested within 30 days of the notice. After the 30 days has lapsed, the beneficiary may still request a waiver but their benefit may then be affected while the request is made.

A waiver is considered when requested within 30 days of receiving the notice of overpayment.

Waiver of Overpayment

The alleged debtor may:

Dispute the existence or amount of the debt

Request waiver of collection of the debt

Request a hearing on the waiver requested

Appeal the decision

It is important to know that although Pension Management Center is the department that issues the debt notice, it is the Debt Management Center department in charge of taking payments or reimbursing any monies owed to beneficiary. These two departments rarely talk to each other.

Therefore, it is important to send the request to both departments.

For questions, call toll-free:

877-4 LA VETS