Income

Countable income includes:   Social Security Income(s), all pension income, earned income from employment, interest income, RMD’s from retirement accounts, short and long-term capital gains, and even gifts to you from your children to help pay for care.

Payments from any source unless specifically excluded. The following sources of income are counted for the purposes of completing the financial assessment.

Countable Income :

• Alimony
• Allowances
• Benefits Subject to Garnishment
• Complaint Settlement
• Cooperative (Co-op) Dividends
• Department of Labor Employment Programs
• Dependency and Indemnity Compensation —This benefit program pays a monthly payment to a surviving spouse, child, or parents of a deceased military service member or Veteran.
• Farm Income/Conservation Resource Program Payments
• Foreign Currency Conversion
• Gambling/Lottery Winnings
• GI Bill
• Gifts and Inheritance of Property or Cash (The fair market value of gifts or inherited property is countable in the year they are received)
• Individual Retirement Account (IRA) Distributions
• Interest and Dividends
• Life Insurance Proceeds (Death Benefit paid to Veteran or spouse). Life insurance is Countable as income in the year that it is received.
• Long-term care insurance payments.
• Net Profits and Depredation from Business, Farm and Ranch, Real Estate
• Partnership, and S Corporations (Depredation is added back in as income)
• Other Income (Prizes/Awards, Inheritances)
• Payments from Stocks and Bonds, Capital Gains
• Pensions, Annuities, Railroad Retirement
• Revocable Trust
• Royalties (Books, Music, Art, etc.)
• Settlements:
• Alaska Native Claims Settlement Act (amounts exceeding $2,000 per individual per annum -including cash dividends on stock received from a Native Corporation)
• American Indian Beneficiaries from trust or restricted lands (amounts exceeding $2,000 per individual per calendar year)
• Social Security Benefits and Death Benefit Payment (including retroactive Lump Sum Payment from previous years)
• Timber Sales
• Unemployment Compensation
• VA Disability Compensation – For the purposes of completing a financial assessment, the gross household income for a Service-connected Veteran who is receiving VA disability compensation and is married to a Nonservice-connected Veteran who is completing the financial assessment, VA disability compensation benefits would be countable income for the household
• Value of Room and Board/Housing Allowances
• Wages (Employment), Salaries, Bonuses, Severance Pay, Tips, and Other Accrued Benefits, etc.
• Workers Compensation

Non-Countable or Exempt income includes:

• Caregiver Payments
• Chore Service Payments
• Crime Victims Compensation Act Payments
• Disaster Relief Payments or Proceeds of Casualty Insurance
• Discharge of Indebtedness
• Federal Emergency Management Agency (FEMA) Disaster Insurance Payments
• Federal Government Sponsored Economic Stimulus Refunds
• Foster Care Payments
• Income from Domestic Volunteer Service Act Program
• Income Tax Refunds
• Loans (Reverse Mortgages)
• Maintenance
• Needs-Based Payments from Government Agency
• Payments for participation in a program of Rehabilitative Services
• Provisional Income
• Relocation Expenses
• Scholarships and Grants from school attendance
• Settlements:
• Agent Orange
• Alaska Native Claims Settlement Act (income of up to $2,000 per individual per annum -including cash dividends on stock received from a Native Corporation)
• American Indian Beneficiaries from trust or restricted lands (income of up to $2,000 per individual per calendar year)
• VA Pension Payments
• Welfare, Supplemental Security Income (SSI), Compensated Work Therapy (CWT), Incentive Therapy (IT) earnings
• Withheld Social Security Overpayments

NOTE: The above list is not all Inclusive.

VETERAN PENSION SECRET #2

There is not a set income limit per se.

Deductible Medical Expenses: May be used to reduce other countable income for purposes of increasing pension benefits. This includes the cost of assisted living, nursing and home care and home health care cost. 

Income Limits:

To qualify for the full pension benefit, your income must be less than your out-go for unreimbursed medical expenses and cost of care.

Example 1: If you are a married or single veteran with a household income of $4,000 per month, and your cost of care in an assisted living community is $4,500 per month, you would have a monthly shortfall of $500. Therefore, you would qualify for the full monthly benefit.

Example 2: If your income is $4,500 per month, but your cost of care in an assisted living community is only $3,500 per month, you would have a $1,000 positive income.

Now even though you have a  $1,000 positive income, you would still qualify, but only for a partial benefit.

The benefit amount paid is determined by subtracting the $1000 from the maximum benefit to get the partial benefit amount.

I have purposely simplified and left out parts of the income and out-go. The VA uses a more detailed MAPR equation than intended for this book.

Just understand there is not a set income limit perse. You need to spend your income on care in order to qualify for benefits.  

See appendix for Commonly Allowed Medical Expenses.

See Maximum Annual Pension Rate or MAPR if you want a more detailed explanation. This can be found on our website.

The Catch 22

How do you pay for care to qualify for Veterans Pension if you don’t have the Veterans Pension benefits to pay for care?

Classic Catch 22! For some, this presents a real dilemma.

How can they use all of their income to pay for care? They have food bills,  housing, and utility bills to pay.

If they have savings, they can use the savings until the VA benefits are approved. Since it is a retroactive benefit paid back to the first of the month following the month the claim was submitted.

Meaning if you submit a claim on January 20, the benefits will accrue from February 1. So once the lump sum benefits are paid, you can put it back in your savings.

But what if you have no savings? How do you pay for needed care if you don’t have the money from the VA to pay for care?This is less of a problem if you are in an assisted living home or community. The cost of assisted living is considered a medical expense. So you could consider moving from your home.

Since an assisted living cost is all-inclusive, it includes room and board, utilities, food, and in some cases, cable.

So now you get the care and reduce your income with other expenses not otherwise included.

Another solution is apply get approved for a partial benefit, then once approved dollar for dollar up to the maximum benefit that you spend on care will be paid by the VA.

Here is what I mean, I once got a claim approved for $1.39! Woo-hoo! Are you bragging to us about this, a $1.39 award? Why?

Here’s why the Veteran was approved. Now they can get home care in and increase the care hours over time up to the maximum benefit amount.

I hope your question of “what are qualifications for a va pension” is answered.