What This Statute Says
Federal law preempts state divorce courts from dividing service-connected veteran disability benefits as marital property. This Arizona section makes the rule explicit and prevents indirect division through indemnification orders.
In making a disposition of property pursuant to section 25-318 or 25-327, a court shall not do any of the following:
A.R.S. § 25-318.1When This Statute Comes Into Play
This rule comes into play when:
- A veteran spouse receives disability compensation under 38 U.S.C. Chapter 11.
- A divorcing veteran is also receiving Combat-Related Special Compensation under 10 U.S.C. 1413a.
- A non-veteran spouse seeks an offset based on the veteran's protected disability income.
What This Means for Arizona Families
Military and veteran families face unique issues at divorce. The non-divisibility of service-connected disability benefits protects the core of veterans' financial support, but it also affects how the rest of the marital estate must be balanced. Estate planning concerns multiply when one spouse relies on benefits that cannot be assigned or shared.
If you or your spouse is a veteran receiving service-connected disability compensation, this section protects that income stream. Our FAQ on VA benefits and long-term care planning covers the broader benefits landscape. An Arizona family law attorney working with a veterans benefits specialist and an estate planning attorney can coordinate the divorce resolution with any required updates to the special needs trust structures or supplemental needs planning that often accompanies veteran families. The non-divisibility rule does not eliminate the need for careful planning; it requires the rest of the marital estate to compensate, and the estate plan needs to align with the new financial picture.