Proposed Cuts to VA Disability Benefits: CBO’s 2025–2034 Report
No talk of rolling back tax cuts for the wealthy.
But cutting veterans’ earned disability benefits? Still very much on the table.
Oh, brother — don’t even get me started.
In 2022, Hill & Ponton published a summary of the Congressional Budget Office’s (CBO) deficit reduction proposals for 2023–2032. Their warning was clear: multiple policy options would take a bite out of VA compensation.
Now, in December 2024, the CBO released a new report —
📘 Options for Reducing the Deficit: 2025 to 2034 —
And guess what? The same dangerous proposals are back.
Different timeline. Same goals.
We reviewed the new report, pulled the worst of it, and added the latest on whether Congress or the administration are actually planning to move forward.
🧨 CBO Proposals That Would Slash VA Disability Benefits
These proposals are not law — yet. But they’re back on the table in 2025, with updated cost estimates and implementation timelines. Here’s what the CBO is still pushing:
🔻 Option 10: Means-Test VA Disability Compensation
Veterans with household income over $135,000/year (starting 2026) would have their VA disability compensation reduced or eliminated — even if their conditions are service-connected.
Projected savings: $253 billion over 10 years
View CBO breakdown
📄 Source: CBO Page 41
🔻 Option 15: End Individual Unemployability (IU) at Retirement Age
Veterans who can’t work due to a service-connected disability would lose their IU benefits once they hit age 67 — even if nothing about their condition changed.
Projected savings: $59 billion
View CBO breakdown
📄 Source: CBO Page 48
🔻 Option 16: Reduce Benefits for Veterans Over Age 67
A 30% cut to VA disability compensation for any veteran who reaches retirement age — but only for claims starting in 2026 or later.
Projected savings: $31 billion
View CBO breakdown
📄 Source: CBO Page 50
🔻 Option 17: Eliminate Compensation for Ratings Under 30%
Veterans rated below 30% (migraines, tinnitus, scars, joint pain, and other chronic conditions) would get zero monthly compensation under this plan — for claims starting in 2026.
Projected savings: $58.6 billion
View CBO breakdown
📄 Source: CBO Page 52
🔻 Option 44: Make VA Disability Compensation Taxable
VA compensation, long considered non-taxable, would now be treated as regular income, reducing what veterans take home each month.
Projected savings: $154 billion
View Full Report PDF
📄 Source: CBO Page 136
👤 Who Gets Hurt If These Cuts Happen?
- A 100% disabled veteran with PTSD and TBI who can’t work loses IU at age 67 — wiping out over $1,000/month.
- A Gulf War-era veteran rated 10% for migraines and 10% for tinnitus — gets wiped off the rolls.
- A Vietnam vet in his 70s with degenerative joint disease — takes a 30% cut just for aging.
- An OIF/OEF veteran with four 10% conditions from toxic exposure — gets zero compensation.
- Any disabled vet still working but earning over ~$135K — loses everything. Too “wealthy” to keep it.
🧨 This isn’t hypothetical. This is what happens if these policies go through.
🔍 Veterans Should Know
- These are CBO options, not laws — but they guide budget deals.
- They’ve shown up year after year, just waiting for a moment of crisis to get pushed through.
- No bill today doesn’t mean no threat. These aren’t dead — just dormant.
👁️🗨️ Watch for euphemisms like:
“Fiscal responsibility” • “Entitlement reform” • “Modernizing benefits” • “Streamlining services”
⚠️ Are These Cuts Actually Moving Forward?
🏛️ Inside the VA & White House
VA Secretary Doug Collins has denied any plans to cut VA disability. In recent statements, he called the rumors “false and harmful.”
Read his response
Still, staffing and morale problems are rising inside the VA — causing concern among vets and advocates alike.
Washington Post coverage
🏛️ In Congress
In early 2025, veterans groups testified before the House and Senate VA Committees, opposing all 5 proposals.
- DAV, AMVETS, VFW, and others called these ideas “unacceptable” and “harmful.”
- Rep. Mike Bost and Sen. Mark Takano spoke out in support of preserving benefits.
Read coverage from Stars & Stripes
📊 Budget Pressure Still Mounting
Behind closed doors, budget negotiators continue citing the CBO report as a menu of deficit-reduction options.
MarketWatch: Entitlements in the Crosshairs
🛑 These Benefits Were Earned — Not Negotiable
Whether it’s means-testing, taxing, or age-based rollbacks — these cuts dishonor the promise made to every veteran.
We gave too much to be treated like budget line items.
📣 Tell Congress: Hands Off VA Disability
Your benefits are under threat — not by law yet, but by design.
Contact your lawmakers:
Sample message you can copy and paste:
“As a constituent and veteran, I strongly oppose any proposal to cut, tax, or means-test VA disability compensation. These benefits are earned through service and sacrifice. I urge you to reject any legislation based on the CBO’s proposals to reduce or eliminate VA benefits.”
🧾 Sources
