Question: I heard that there has been a change in Veteran’s Benefits recently, is this true?
Answer: Yes, that is correct. Specifically, the Pension system, most often referred to as “Aid and Attendance” has been revamped. New asset and income levels have been created and for the first time with this type of benefit a three year look back now applies. In order to be eligible for the pension program the veteran must have served during specific wartime periods, been honorably discharged, meet the medical necessity standard and the asset/income threshold. The veteran’s spouse or widow is also eligible for the pension if s/he meets the criteria.
The net worth of an individual seeking the pension cannot exceed $123,600.00 in 2018. The net worth applies regardless of whether the individual is single or married. The net worth is comprised of the total assets plus the annual income of the individual (and spouse if married). The primary residence (plus up to two acres), all vehicles needed for family transportation and personal effects are excluded from “total assets.” If an individual exceeds $123,600.00 in assets plus annual income, “qualifying medical expenses” can be used to bring down the total to below $123,600.00. Qualifying medical expenses is defined as expenses that are primarily needed to alleviate or prevent a physical or mental defect. For example, if a wartime veteran has assets that total $90,000.00 and an annual income of $45,000.00, it would seem that he would not qualify for the pension because his total worth of $135,000.00 exceeds the limit of $123,600.00. However, if the veteran has $15,000.00 of qualifying medical expenses, this would be deducted from his total worth, bringing it below the $123,600.00 threshold.
In the past, individuals applying for the pension could transfer assets out of their name and qualify for the pension the following month. For example, if a veteran had a total net worth of $200,000.00, s/he could transfer $77,000.00 to a family member or irrevocable trust in order to qualify for the pension. However, the new changes implement a 36 month look-back period. Meaning, all funds/assets that exceed the $123,600.00 that were transferred within the look-back period will result in a penalty to the veteran or veteran’s spouse. This makes pre-planning crucial if the veteran or spouse wants to rely on the pension in the future.
Currently, in 2018 the maximum pension benefit for a qualifying applicant is: $2,903 for two married veterans, $2,169.00 for a veteran with a spouse, $1,830 for a single veteran, and $1,176.00 for a surviving spouse.
-- Nancy Burner, Esq. and Robin Burner Daleo, Esq.