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VA Unemployability Explained – What is TDIU?

Tucker Law Group
February 8, 2021

Disabled Vets Can Receive a Total Disability Rating (100%) If They Cannot Work Because of Their Service Connected Disabilities

Most veterans know about the Department of Veterans Affairs (VA) Schedule for Rating Disabilities (Rating Schedule) for service connected compensation. Each different disability that a veteran can prove is related to their service gets rated at different percentages using a list of ratings found in VA regulations. Veterans are rated in 10% increments from 0% up to 100%. The amount of their compensation goes up the higher their total (or combined) rating is.

However, there is a way that a veteran who does not have a combined rating of 100% can still get paid as if they were 100% rated if their service-connected disabilities prevent them from working. It is called Individual Unemployability, often abbreviated as “IU” or “TDIU” for Total Disability due to Individual Unemployability.

What is TDIU?

TDIU is a VA extra-schedular rating, meaning that it can be awarded outside of the normal ratings schedule. It is a way for veterans to prove that their service connected disabilities prevent them from getting or keeping a job, even when they do not have a 100% schedule rating for their disabilities. The VA adopted a detailed regulation explaining how a veteran can qualify for TDIU and how the VA must evaluate unemployability claims – 38 C.F.R. §4.16. When a veteran is approved for TDIU, they will be paid the same monthly compensation rate as if they had a schedular 100% rating, because the VA is recognizing that they are totally disabled.

Getting Individual Unemployability qualifies the veteran’s spouse for VA healthcare coverage through CHAMPVA.  TDIU also typically qualifies the veteran for state-sponsored benefits that are given to totally disabled veterans, such as property tax exemptions, license tag tax breaks, hunting and fishing license fee exemptions, and other valuable benefits.

How a Veteran Qualifies for Total Unemployability Under 38 C.F.R. §4.16

VA did not make the unemployability regulation easy to read, but here are the key parts you should start with:

  1. Unemployability only applies to veterans whose rated disabilities combine to a rating less than 100%.
  2. The veteran must be unable to get work OR keep work because of their service connected disabilities that are rated.
  3. Disabilities that are not related to service cannot be considered.
  4. To qualify without special consideration by the VA’s Director of Compensation, the veteran has to have one or more rated disabilities at certain percentages, as follows:
  • One disability rated at 60%, OR
  • More than one disability with a combined rating of 70%, and one of the rated disabilities rated at least at 40%.
  • Note: If a veteran does not meet these percentage requirements, there are still ways to prove that their service connected conditions qualify them for TDIU – see below.

Some Disabilities Are Combined Under §4.16 to Help the Veteran Prove TDIU

To get to the schedular requirements for one disability meeting the 60% or 40% levels under §4.16, VA allows some disabilities that are rated separately to be combined into one disability. Those include:

  1. Disabilities of one or both arms;
  2. Disabilities of one or both legs;
  3. Disabilities that came from the same cause, i.e. a common etiology or a single accident;
  4. Disabilities affecting a single body system, such as orthopedic, digestive, respiratory, cardiovascular-renal, or neuropsychiatric;
  5. Multiple injuries incurred in action; or
  6. Multiple disabilities incurred as a prisoner of war.

VA often will not consider these combination requirements properly, and many veterans do not know they exist. These combinations can be very powerful tools to help the veteran meet the requirements of §4.16.

Even Vets Who Fall Short of the Schedular Requirements of §4.16 Can Get Unemployability

The VA often ignores unemployability for veterans that do not meet the percentage requirements of the regulation. However, the plain text off §4.16(b) plainly states that VA must send “to the Director, Compensation Service, for extra-schedular consideration all cases of veterans who are unemployable by reason of service-connected disabilities, but who fail to meet the percentage standards set forth in paragraph (a) of this section.”

This means that any veteran who cannot work because of their service-connected disabilities can qualify for unemployability. This includes vets who do not meet the percentage requirements of having one disability at 60% or multiple disabilities at 70%. If the VA has denied a claim by a veteran for unemployability who does not have the required rating percentages, it still had to send that vet’s claim out to the Director of Compensation for extra-schedular TDIU consideration. VA almost always fails to do this, and it is the basis for a valid appeal.

What Does VA Consider To Decide TDIU Claims?

The law requires VA to evaluate several things to decide if a veteran is unemployable, including the veteran’s:

  1. service-connected disabilities;
  2. employment history;
  3. education; and
  4. past work history and job training.

VA may not consider age as a factor in individual unemployability claims. That means that a disabled veteran can still qualify for an extra-schedular total disability rating even when they are over retirement age.

TDIU Can Sometimes Still Be Paid If a Vet is Working

Marginal Employment

The unemployability regulation plainly states that some work will not be considered by VA to determine if a vet qualifies. A veteran can work and still qualify for TDIU, but only if they are working in what the VA calls “marginal employment,” which is a job that pays less than the poverty threshold announced by the U.S. government.  This is currently just over $1,000 per month for a single veteran and slightly over $1,400 for a married veteran.  The amount increases with the number of people in your household)  The bottom line is that a veteran can work some and still qualify for TDIU, but they need good wage records to prove they are under the marginal employment cap.

Sheltered Work

If a veteran is working in a protected or sheltered workplace, they can still qualify for TDIU as well. Examples of this type of work might be in a family business, where strict attendance is not required or working for a friend or creates a job with very limited job duties that would not exist elsewhere.


Individual Unemployability is an extra-schedular path to get paid at the full100% total rating amount, though a 100% schedular rating is not awarded. Veterans who cannot work because of their service connected disabilities should consider filing a VA Form 21-8940 (Veteran’s Application for Increased Compensation Based on Unemployability) immediately to start the process of getting TDIU benefits.

Learn More About VA Individual Unemployability

If you are looking for a Veterans disability lawyer to handle a denied Individual Unemployability claim, call us toll-free nationwide at (866) 233-5044 or use our online contact form to schedule an appointment with one of our VA disability attorneys. Our VA disability lawyers help veterans and their families recover the VA service-connected compensation they deserve after a claim denial. We handle TDIU cases all over the country for vets just like you. Contact our firm today for a free consultation.