VA Pension

1. VA Pension Max Barron Veteran Service Officer

2. What is it? • Pension is tax-free supplemental income program payable to low-income veterans or their surviving spouse. • VA Pension was never intended to be a “retirement” benefit that would meet all of the veteran’s financial obligations.

3. Eligibility • Service during a wartime period • Age 65 or older, or • Totally and permanently disabled, or • Patient in a nursing home, or • Receiving SSDI, or • Receiving Supplemental Security Income • If you are unsure if the vet is eligible, file the claim! The VA will rule on it.

4. Income Based • Family income must be below amount set by Congress. • Countable income includes income from most sources as well as from any eligible dependents. • Generally includes earnings, disability and retirement payments, interest and dividend payments from annuities and net income from farming or a business.

5. Income Based (cont) • Veteran and spouse should report their entire net worth. • Net worth includes bank accounts, stocks, bonds, mutual funds, annuities, property other than primary residence. • Bottom line is report all income and net worth. The VA will make the final ruling.

6. Medical Expenses • A portion of out of pocket expenses can be used to lower the veteran’s countable income. • Expenses must be proven • Generally expenses include Medicare, Insurance Premiums, Prescription Insurance plans, Dental Insurance, co-pays, etc. • Please refer to handout provided.

7. Assisted Living/Nursing Homes • Costs to stay in an assisted living facility may be allowed to be deducted as a medical expense. • Costs to stay in a skilled nursing facility generally will be allowed to be deducted as a medical expense.

8. Pension Example • Annual income limit for vet and spouse is $13,855 (MAPR). • Combined income is $10,855 • Medical expenses are $8,000 • Insurance paid $6,400 • Unreimbursed expenses are $1,600 • Calculate the portion of medical expenses that are above 5% of MAPR ($13,855)

9. Pension Example (cont) • 5% of $13,855 is $693 • $1,600 - $693 = $907 • $10,855 - $907 = $9,948 • $13,855 - $9,948 = $3,907 • $3,907 divided by 12 = $325 per month

10. Pension Nightmares • Any changes affecting income/net worth must be reported! • Veteran marries/divorces • Child moves into the household • Vet moves in with family • Vet’s spouse goes to work and earns income • Vet starts receiving social security benefits • Vet goes into a nursing home or assisted living facility • Any change in income or net worth • The VA will find out! (Eventually)

11. Forms to use • 21-526 Initial claim for Pension and/or Compensation (Veteran) • 21-527 for Pension only (Net worth statement-Veteran) • 21-534 Pension for Surviving Spouse • If nothing else, complete one of these forms in it’s entirety. If the VA needs more documents they will write to the vet/spouse and tell them what is needed.

12. Forms to use (cont) • 21-527 EZ (If Fully Developed) • 21-534 EZ (If Fully Developed) • 21-0518 Eligibility Verification Report (Surviving Spouse) • 21-8416 Medical Expense Report • 21-2680 Housebound/Aid and Attendance • 21-0779 Nursing Home Information • 21-674 Request for approval of school attendance for college student 18-23

13. Other supporting documents • Marriage certificates • Death certificates • Medical documentation showing disabilities • Receipts of medical expenses • Birth certificates for dependent children • Veteran’s DD 214 • Copies of trusts

14. Summary • Pension is a supplemental income program for veterans or surviving spouses that have virtually no income. • It is a benefit that changes with any change in income or net worth. • Take a good history on the vet/spouse and if eligibility is unsure go ahead and file! • Report all income and net worth • Stress to the vet/spouse how important it is to immediately report any changes to income or net worth.

15. QUESTIONS?