Income Withholding for Support (IWO’s) and VA Benefits

Section 459 of the Social Security Act prevents child support agencies from garnishing most benefits paid by the Department of Veterans Affair (VA).  The exception is disability compensation paid in lieu of waived military retired or retainer pay.

If a veteran who is eligible to receive military retired or retainer, pay has waived a portion of retired or retainer pay in order to receive disability compensation from the VA, that portion of the VA benefit is subject to garnishment for child support (and spousal support) obligations.

If, however, a veteran has waived the entire amount of his or her military retirement pay, that individual’s disability compensation is not subject to income withholding for child support.

For NCP’s who are former members and meet the qualifications in the first of the two above scenarios, the IWO’s for VA child support need to be sent to:

The worker will need to create a type 05 address on APEU for the following:

Once the IWO is printed, the worker will then need to e-mail it to the worker’s own account, and edit the address to reflect the “Compensation Intake Center.”  A cover letter (via G03) to the Jamesville, Wisconsin address should also be included.  The letter should read as follows:

RE:   (FGN XXXXXXXXX)

Dear Department of Veterans Affairs,

The attached Income Withholding Notice is forwarded to your office for review and determination.  _INSERT OBLIGOR’S NAME_ is receiving Veterans’ Benefits.  Please update your records according to the withholding notice and remit payments as indicated.  In the event you are unable to withhold, please respond in according with the withholding notice.”

The timeframe before any possible payments are received when using this process is between three and six months.  Those payments will likely be identified as “U.S. Treasury.”   For help in determining whether a veteran waived any portion of retired or retainer pay in order to receive VA benefits, the worker can contact the VA Regional Office Inquiry Line: 1-800-827-1000.

In addition, the VA Form 21-4138 Statement in Support of Claim (PDF) should be included. The normal VA procedure is to request this after receiving an apportionment application, time may be saved by doing this at the same time.

Also, include a copy of the current support order and an updated Record of Payment (ROP).

For more information, please see the OCSS Information Memorandum IM-98-03.