Military disability retired pay and VA disability compensation are not divisible as a property settlement. It can, however, be garnished as alimony. In Howell v. Howell, a case decided by the US Supreme Court in 2017, the Court decided that a trial judge could not order a military retiree to reimburse his former spouse for moneys lost when the retiree elects to receive non-taxable disability compensation form the Department of Veterans Affairs (VA), an action which can result in a dollar-for-dollar decrease in retired pay.
The Howell case was decided based on an order by the trial court in the absence of a contractual reimbursement clause. Some type of an indemnification clause in the Settlement Agreement should be considered.