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Equitable Distribution of Veterans Disability and Social Security Benefits

An undecided question in the Second Department (covering Nassau and Suffolk Counties) is how to distribute benefits earned by a military member. The departments are split on this issue and the Court of Appeals, the highest court in New York, has yet to definitively rule.

The fourth department has held that while disability benefits obtained from other sources may be considered for purposes of maintenance, veteran’s disability payments are precluded from consideration. 10 U.S.C. § 1408. The third department held the opposite, stating that veterans benefits can be considered when deciding on equitable distribution. With respect to social security benefits, it is well settled that Social Security Disability Benefits are separate property and are not subject to equitable distribution. DRL § 236(B)(1)(d)(2); Miceli v. Miceli, 78 AD3d 1023 (2d Dept.2010). However, Social Security Disability Benefits, unlike veteran’s disability benefits, are to be considered by the Court when determining a payor spouses ability to pay maintenance.

In Alvarado v. Alvardo, a case decided January 15, 2013, the trial court in Richmond county, dealt with the issue of what should happen to veteran’s and social security benefits. Mr. Alvarado, served in the U.S. Marines from 1965-1969. As a result of his service, he was awarded veterans benefits. The parties were married in 1980 and now seek to dissolve the marriage. Ms. Alvardo seeks to have her husband’s veteran’s benefits as well as the social security he is entitled considered part of the marital property for equitable distribution purposes.

The easier issue is that of the Social Security benefits. Clearly, the benefits he gains from social security will not be considered for purposes of equitable distribution, however, if the Court were to deem maintenance appropriate, the Court will consider the husbands benefits as part of his income when determining his ability to pay maintenance. Addressing veterans benefits, a topic which is hotly contested, the Court held that absent a contractual agreement otherwise, veteran’s benefits are not to be considered when distributing assets as part of equitable distribution.

In addition to the vague guidance given by the Courts regarding this issue, if you are military member, you are entitled to many benefits which civilian courts are not accustomed to seeing. BAH, OHA, special pays etc. will be foreign concepts to most Courts. If you are a military member and are proceeding with a divorce in New York, be sure your attorney is prepared to explain all of these benefits so that you are not being held responsible for monies that you are not actually receiving.

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