What Fees Are Legal on a VA Claim

Representation through a VA-recognized Veterans Service Organization is free, and the fee regulation itself is where that comes from. 38 CFR 14.636(b) provides that only accredited agents and attorneys may receive fees from claimants or appellants for services provided in connection with representation, and that recognized organizations, including their accredited representatives when acting as such, are not permitted to receive fees. The statute underneath it, 38 U.S.C. 5902(b)(1)(A), makes recognition conditional on a certification that no fee or compensation of any nature will be charged for services rendered in connection with any claim.

That leaves a short list of people who may ever be paid for claims work: accredited attorneys and accredited claims agents. Everyone else VA authorizes to prepare, present, and prosecute claims does it at no charge, because the same rule that authorizes them forbids the fee. For the two groups who may charge, the permission is conditional rather than general, and the conditions are where most of the confusion in this subject lives.

Three conditions must all hold, and they sit at 38 CFR 14.636(c)(1)(i). VA must have issued notice of an initial decision on the claim, and that notice must have been issued on or after February 19, 2019, the effective date of the modernized review system under 38 CFR 19.2(a). A power of attorney meeting the requirements of 38 CFR 14.631 must be on file. A written fee agreement meeting the requirements of paragraph (g) must exist. VA states the same test in plain language on its accredited representative FAQ page: a decision on the initial claim, a fee agreement signed by both the veteran and the accredited attorney or claims agent, and a VA Form 21-22a appointing that person as representative. The same page notes that some accredited attorneys and claims agents provide services for free on initial claims, and that most offer their services after VA has decided the initial claim.

The statute says it from the other side. 38 U.S.C. 5904(c)(1) provides that a fee may not be charged, allowed, or paid for the services of agents and attorneys with respect to services provided before the date on which a claimant is provided notice of the agency of original jurisdiction's initial decision. The bar covers the services provided before that notice rather than some subset of them, which is what makes work on an initial claim unpaid work. The conduct standards close the obvious way around it. 38 CFR 14.632(c)(5) prohibits entering into an agreement for, charging, soliciting, or receiving a fee that is clearly unreasonable or otherwise prohibited by law or regulation, and (c)(6) prohibits soliciting, receiving, or entering into agreements for gifts related to services for which a fee could not lawfully be charged, so a gift is not a lawful substitute for a fee the timing rule bars. Charging excessive or unreasonable fees for representation is separately a ground for canceling accreditation under 38 CFR 14.633(c)(6).

Three, and each is narrow. The first is statutory: the limitation in 38 U.S.C. 5904(c)(1) does not apply to fees charged, allowed, or paid for services provided with respect to proceedings before a court, which is a different forum from the agency and the Board. The second is at 38 CFR 14.636(d)(1), which allows a reasonable fee for Chapter 37 home loan matters even where the timing conditions in paragraph (c) have not been met.

The third is the disinterested third party at 14.636(d)(2). Someone with no financial stake in the outcome, such as an organization or a government entity, may pay an accredited agent or attorney even before an initial decision has issued. Two limits ride along with that permission. The fee may in no such case be contingent, in whole or in part, on whether the matter is resolved in a manner favorable to the claimant. And under (d)(2)(ii) a spouse, child, parent, or person living with the claimant is presumed not to be disinterested, a presumption that can be rebutted only by clear and convincing evidence.

The phrase covers more than a first-ever claim. 38 CFR 14.636(c)(1)(i) states that an initial decision on a claim includes an initial decision on an initial claim for an increase in rate of benefit, an initial decision on a request to revise a prior decision based on clear and unmistakable error, and an initial decision on a supplemental claim that was presented after the final adjudication of an earlier claim. A veteran who has held a rating for years and files for an increase is therefore standing at the start of the timing rule again rather than past it.

The supplemental claim is where the rule runs against intuition. A supplemental claim filed within one year of a decision is treated as part of the earlier claim, so the earlier initial decision already opened the fee window and a fee may be charged for the work. A supplemental claim filed after that year has lapsed is a new claim, and nobody may charge for work on it until VA issues an initial decision on that supplemental claim. The form is identical in both cases. The date on the prior decision letter is what separates them, which makes that date worth finding before anything is signed.

No. Fees have to be reasonable under 38 CFR 14.636(e), and that paragraph allows them to be based on a fixed fee, an hourly rate, a percentage of benefits recovered, or a combination of those bases. The figure of 20 percent of past-due benefits is doing two separate jobs in the regulation, and neither of them is a ceiling. It is the limit on what VA will pay directly to a representative out of past-due benefits, at 38 CFR 14.636(h)(1)(i). It is also the level presumed reasonable under 14.636(f)(1), and that presumption attaches only where the agent or attorney provided representation that continued through the date of the decision awarding benefits. Where representation ended earlier, 14.636(f)(2) entitles the agent or attorney who was discharged or who withdrew to a fee that fairly and accurately reflects his or her contribution to and responsibility for the benefits awarded.

The outer marker is one third. Under 14.636(f)(1) a fee exceeding 33 1/3 percent of past-due benefits awarded is presumed unreasonable, and both presumptions are rebuttable by clear and convincing evidence measured against the ten factors in paragraph (e): the extent and type of services performed, the complexity of the case, the level of skill and competence required, the amount of time spent, the results achieved including the amount of any benefits recovered, the level of review the claim was taken to and the level at which the representative was retained, rates charged by others for similar services, whether and to what extent payment is contingent on results achieved, why a representative was discharged or withdrew where that applies, and the fee entitlement of any other agent or attorney in the case. The regulation's own drafting settles the question of a cap. 14.636(g)(2) says what becomes of a fee agreement that specifies a fee greater than 20 percent of past-due benefits awarded by VA: it is treated as an agreement in which the agent or attorney is responsible for collecting the fee from the claimant without assistance from VA. A provision that prescribes the handling of a fee above 20 percent presupposes that such a fee can exist.

The agreement must be in writing and signed by both the claimant and the agent or attorney. 38 CFR 14.636(g)(1) requires it to state the veteran's name, the claimant's name where that differs, the name of any disinterested third party paying the fee and that party's relationship to the veteran, the VA file number, and the specific terms under which the amount to be paid for the services will be determined. Filing carries its own deadlines under (g)(3): a direct-pay agreement goes to the agency of original jurisdiction within 30 days of execution, and any agreement that is not direct-pay goes to the Office of the General Counsel within 30 days of execution, with late filing accepted only on a showing of sufficient cause. One drafting trap sits at (g)(2). An agreement that does not clearly specify that VA is to pay the representative out of past-due benefits, or that specifies a fee greater than 20 percent of past-due benefits awarded, is treated as an agreement in which the representative is responsible for collecting the fee from the claimant without assistance from VA.

Direct payment happens only where four things are true, at 14.636(h)(1): the total fee payable excluding expenses does not exceed 20 percent of the total past-due benefits awarded, the amount of the fee is contingent on whether the claim is resolved in a manner favorable to the claimant, the representative is accredited on the date of VA's fee allocation notice, and the award produces a cash payment from which the fee can be deducted. Past-due benefits are defined at (h)(3) as the lump sum accruing between the effective date of the award and the date it is granted, computed for a service-connection grant on the initial disability rating the agency of original jurisdiction assigns, and computed on the total past-due amount even where part of it is apportioned to dependents. VA charges an assessment on money it pays directly, equal to 5 percent of the fee and capped at $100, and 38 U.S.C. 5904(a)(6)(D) forbids the representative from passing that assessment back to the claimant. VBA reported $419.5 million in such direct payments over the 12 months ending July 2026, an average of $35.0 million a month, with its own caveat that the totals exclude payments veterans make directly to attorneys, so the published figure is a floor rather than a total.

The review procedure was rewritten effective April 1, 2025, so older material on this subject describes a process that no longer exists. Under 38 CFR 14.636(i), where a direct-pay agreement is on file and a decision awards past-due benefits, the agency of original jurisdiction issues a fee allocation notice that decides eligibility for direct payment and sets a default allocation. A party who disagrees with the allocation may seek a fee review from the Office of the General Counsel, whose decision is premised on the paragraph (e) factors, the paragraph (f) standards, the 20 percent limit at (h)(1)(i), the claims file, and the parties' submissions, and is final adjudicative action appealable only to the Board of Veterans' Appeals. A party who disagrees with the eligibility determination may only appeal to the Board. Timely filed means within 60 days of the fee allocation notice, and absent a timely filing the default allocation becomes final and VA releases the fee.

VA holds three separate levers over a fee it considers excessive. Under 38 U.S.C. 5904(c)(3)(A) the Secretary may review a filed fee agreement, on the Secretary's own motion or at the claimant's request, and order the fee reduced where it is found excessive or unreasonable. Under 5904(c)(3)(C), where VA suspends or excludes an agent or attorney who collected an excessive fee, the suspension continues until full restitution has been made to each claimant from whom the excessive fee was collected. And 38 CFR 14.633(c)(6) makes charging excessive or unreasonable fees for representation an independent ground for canceling accreditation on clear and convincing evidence. None of this reaches the claim itself. VA's rating activity applies the Schedule for Rating Disabilities at 38 CFR Part 4 to the evidence in the file, no fee arrangement of any size changes who decides, and representation through a recognized VSO is free at every stage described on this page.