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Restore Veterans' Compensation Act of 2026

This bill stops the government from taking back separation pay from veterans who later qualify for disability benefits. It also limits how much can be deducted from military pensions to repay past separation incentives, protecting veterans' financial security.
Key points
Ends the practice of deducting separation pay from VA disability compensation.
Limits monthly deductions from military retired pay to a maximum of 25% of the monthly amount.
Recoupment amounts will now be based on the net pay received after federal income taxes were withheld.
Requires a 90-day notice period before any deductions from retirement pay can begin.
Allows the Secretary of Defense to waive repayments if they would cause financial hardship for the veteran.
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Status:
Introduced
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Additional Information
Restore Veterans’ Compensation Act of 2026
Print number: HR 7027
Sponsor: Rep. Bilirakis, Gus M. [R-FL-12]
Process start date: 2026-01-13