Pending Changes to VA Pension Benefits
Last year the Department of Veteran Affairs proposed changes to the regulations that affect VA Pension eligibility. Read on to learn how these proposed changes will affect the VA Pension Program benefits for wartime Veterans and the surviving spouses of wartime Veterans once they are implemented.
The VA Pension Program currently benefits wartime Veterans and their surviving spouses who meet the following criteria:
- The Veteran must have served a minimum of 24 months of active duty
- The Veteran must have served at least one day of active duty during a wartime period
- The Veteran must not have received a dishonorable discharge
- The Veteran must be at least 65 years of age or be permanently disabled
- The applicant’s net worth must not be excessive (there must be evidence that the Veteran’s net worth will be insufficient to last them their lifetime)
- The applicant’s household income must be less than the amount of benefit that is being sought
The proposed changes to the VA Pension will include:
- A specific limit on the net worth that an applicant is allowed to have if they are to qualify for VA Pension benefits.
- Changes to the definition of assets: annual income, including Social Security benefits, would be considered an asset under the new rules.
- A cap on the lot size of the applicant’s primary residence: in calculating net worth, his or her primary residence is an excluded asset as long as it is 2 acres or less.
- The addition of penalty periods (maximum 10 years) for assets that are transferred prior to applying for a VA Pension. These assets can include gifts or the transfer to a revocable or irrevocable trust.
- Changes to the maximum hourly amount that can be paid to a home health care provider based on the national average cost rather than local costs.
The proposed regulations will likely be issued sometime this year but the VA has not indicated whether or not the new rules will apply only to new applications. Therefore, it is not known if pending applications and existing VA pension benefit recipients will be affected as well. In any case, the pending changes to the VA Pension Benefits are another important reason for seniors to speak with an experienced estate planning attorney.