How Is VA Disability Paid in Arrears?
Understand how the VA processes and disburses past-due disability benefits, including how payment amounts are determined.
The Department of Veterans Affairs (VA) provides financial compensation to veterans with illnesses or injuries incurred or aggravated during active military service. These are known as service-connected disabilities and can encompass both physical and mental health conditions. The tax-free monthly payment amount is determined by a disability rating reflecting the condition’s severity.
Understanding VA Disability Arrears
VA disability benefits are “paid in arrears,” meaning payments are disbursed for periods that have already concluded. This means that the payment you receive at the beginning of a month is for the benefits accrued during the previous month. For example, a payment received on December 1st would cover the benefits for the entire month of November.
This concept becomes relevant when a veteran’s initial claim for benefits is approved, or when an increased disability rating is granted. The VA then calculates and issues a lump sum payment, referred to as retroactive benefits or “back pay.” This lump sum covers the period from the established “effective date” of entitlement until regular monthly payments commence. These retroactive funds compensate the veteran for the time they were entitled to benefits but had not yet received them.
Determining Your Effective Date
The “effective date” is a fundamental component in VA disability claims, marking the official starting point for a veteran’s entitlement to benefits. This date dictates the period for which retroactive payments are calculated. Generally, the effective date is the later of two dates: when the VA initially received the claim, or when the veteran’s entitlement first arose.
Specific circumstances can influence this determination. For instance, if a veteran files a claim for disability compensation within one year of separation from active military service, the effective date can be the day immediately following discharge. For claims seeking an increased disability rating, the effective date is typically the later of two dates: when the request for increase was filed, or when medical evidence clearly demonstrates the condition worsened.
Special rules also apply to conditions presumptively linked to service. If a claim for a presumptive condition is received within one year of discharge, the effective date may be the date the illness or injury first occurred. When a previously denied claim is reopened, the effective date is typically the later of two dates: when the request to reopen was received, or when the illness or injury first presented itself. Submitting an “Intent to File” can help secure an earlier effective date, often preserving it for up to a year before the formal claim is fully submitted.
Receiving Your Arrears Payment
After the VA processes a disability claim and establishes an effective date, and benefits are approved, any owed arrears are disbursed. Once the decision is finalized, the VA pays the calculated lump sum. These payments are primarily made through direct deposit.
Veterans generally receive their first payment, including retroactive benefits, within 15 days of their official award letter. While this is a common timeframe, the actual receipt can sometimes extend to a few weeks, especially for larger back payments exceeding $9,999, which may require additional verification. Following the initial lump sum, regular monthly payments commence. These ongoing payments are also made in arrears, meaning the benefit for a given month is typically deposited on the first business day of the subsequent month. If the first day of the month falls on a weekend or holiday, the payment is typically issued on the last business day of the preceding month. The VA also sends a notification letter outlining the decision and payment amount.