How to Get Tax-Free Special Monthly Compensation
Special Monthly Compensation is an additional tax-free benefit that can be paid to Veterans, their spouses, surviving spouses and parents. For Veterans, Special Monthly Compensation is a higher rate of compensation paid due to special circumstances such as the need of aid and attendance by another person or by specific disability, such as loss of use of one hand or leg. For spouses and surviving spouses, this benefit is commonly referred to as aid and attendance and is paid based on the need of aid and attendance by another person.
The first level of Special Monthly Compensation that we will examine is SMC(k), which has a compensation rate of $118.33 per month as of June 2022. This encompasses loss (amputation) or loss of use of a body part(s) or function(s). This rate applies to each body part lost, or that has loss of use, and can be added to other Special Monthly Compensation rates as long as your other SMC qualifying condition is not the same as your SMC(k) or the other rate is capped.
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