Under the HAVEN Act, veterans or their family members who file Chapter 7 bankruptcy may exclude the certain types of income from the means test.
Written by Attorney Andrea Wimmer.
Updated February 13, 2021
Disabled veterans, reservists called to active duty and members of the national guard don't have to count compensation connected to their service as part of the bankruptcy means test.
In 2019, Congress passed the HAVEN Act to expand this protection for veterans and their families. Under the HAVEN Act, Veterans or their family members who file Chapter 7 bankruptcy may exclude the following types of income from their means test analysis:
Disability and death benefits paid by the Veterans Administration under Title 38.
Monthly special compensation for catastrophic injuries or illnesses paid to servicemembers under 37 U.S.C. § 439.
Any combat-related special compensation paid by the Department of Defense under 10 U.S.C. § 1413a.
Disability severance pay paid by the Department of Defense under 10 U.S.C. § 1212.
Any payment by the Department of Defense to a survivor in connection with the death of a member of the uniformed services. See 10 U.S.C. §§ 1431-1456.
Disability-related military retired pay paid by the Department of Defense to a servicemember retired under 10 U.S.C. §§ 1201-1202, 1204-1205 but only to the extent that they exceed the military retirement amount the veteran would have received if they retired without a disability.