Disability compensation is a monetary benefit paid to veterans who are disabled by an injury or illness that was incurred or aggravated during active military service. These disabilities are considered to be service connected. For instance you may have problems with your respiratory system, skin conditions, or hammerhead toe as a result of your military service.
Monthly disability compensation varies with the degree of disability and the number of eligible dependents. Veterans with certain severe disabilities may be eligible for additional special monthly compensation (SMC). Disability compensation benefits are not subject to federal or state income tax.
The payment of military retirement pay, may affect the amount of VA compensation paid to disabled veterans.
To be eligible for compensation, the veteran must have been separated or discharged under conditions other than dishonorable.
For additional details on types of disability claims, go to http://www.benefits.va.gov/compensation/.