S. 5266: Veterans’ Earned Benefits Access Act of 2026

This bill would change how the Department of Veterans Affairs (VA) collects money when a service member or veteran is owed certain military separation-related payments but is also receiving VA disability compensation.

What the bill changes

Under current law, some amounts paid as separation pay, severance pay, or readjustment pay can be deducted from a veteran’s disability compensation. This bill would keep that general rule, but give the VA more flexibility in how those deductions are collected.

Specifically, the VA Secretary could:

• take the deduction in monthly installments,
• collect it as a lump sum, or
• use another payment plan the Secretary decides is appropriate.

Hardship protection

The bill would also allow the VA to waive the deduction requirement if the person can show that the deduction would cause financial hardship.

Limits on monthly deductions

The bill would require the VA to issue regulations within 90 days after enactment. Those regulations must ensure that any monthly deduction from disability compensation does not exceed 25% of the veteran’s disability compensation for that month. The regulations must also create a process for applying for a hardship waiver.

When it would take effect

The changes would not start immediately upon passage. They would take effect on the first day of the first month after the VA publishes final regulations in the Federal Register, and would apply to disability compensation paid on or after that date.

Relevant Companies

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