“You cannot work if you have a 100 percent VA disability rating.”
A schedular 100 percent rating has no work restriction at all. The exception is TDIU, which pays at the 100 percent rate specifically because you cannot maintain substantially gainful employment, so sustained full time work can end it.
What the regulation actually says
There are two ways to be paid at the 100 percent rate, and they follow different rules. A schedular 100 percent rating means your conditions meet the 100 percent criteria in the rating schedule (38 CFR Part 4). Nothing in the schedule conditions that rating on employment. You can work full time at any salary and keep a schedular 100 percent rating.
Total Disability based on Individual Unemployability (TDIU) is different. Under 38 CFR 4.16, VA pays the 100 percent rate to veterans rated below 100 percent who cannot secure or follow a substantially gainful occupation because of service connected disabilities. Because unemployability is the basis of the benefit, returning to substantially gainful work is a reason to discontinue it.
Even for TDIU there are protections. Marginal employment, generally earnings below the federal poverty threshold for one person, does not count as substantially gainful under 38 CFR 4.16(a). And under 38 CFR 3.343(c)(2), VA may not discontinue TDIU until the veteran maintains substantially gainful employment for 12 consecutive months.
The exceptions
- TDIU recipients: sustained, above poverty line employment for 12 consecutive months can end the TDIU portion of the benefit
- Sheltered or protected work environments can still qualify as marginal employment even above the earnings threshold