VA Overpayment and What Veterans Can Do To Avoid Them
Alyse Phillips: Welcome to CCK Live Under 5:00, our short-form videos for veterans. I’m Alyse Phillips with Chisholm Chisholm & Kilpatrick. Today, we’re reviewing how to avoid a VA overpayment.
An overpayment is a debt that VA creates when it determines a veteran has been paid more than they were entitled in benefits. Veterans who have been overpaid will be issued an overpayment notice and asked to return the extra money to VA. VA will collect the debt by withholding current or future disability payments made to the veteran, and a veteran typically has 30 days from the date that VA notifies them of the overpayment before the debt is recouped or recovered from the veteran.
They can occur when there is a change in dependency status or when a veteran fails to report their divorce to VA and continues to receive dependency benefits for their spouse despite that divorce. VA pension recipients could fail to report their income, there could be a change in enrollment in education programs, or there could be a failure to report a period of incarceration to VA.
VA may just mistakenly believe that an overpayment has occurred. There are two different ways to fight overpayments. When VA does create an overpayment, you will be notified with the total amount and the request of what is to be repaid. If you believe that this overpayment was created either by mistake or you’re unable to repay it, you can take certain actions in response.
You can dispute the amount or the existence of the debt at any time. Please note that if you would like to delay the collection of the debt, you must dispute it within 30 days of notice. Otherwise, the debt will start being collected. If VA decides the debt is correct, the veteran can still request an overpayment waiver. A veteran can request a waiver for VA overpayment within 180 days from the date of the overpayment notice.
If a waiver is requested within 30 days of the notice, the collection of the debt should be stayed until the request has been resolved. Veterans should include a financial status report to show how paying back the debt would cause them financial hardship. And if the veteran believes the overpayment was created through the fault of VA, they can argue it be waived. If it is found to be a VA administrative error or error in judgment, the veteran may be able to keep the excess payments.
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