If you are a war-time veteran or widow of a war-time veteran, you may qualify for a tax-free benefit to help you pay for the cost of long term care, such as the cost of independent, assisted living or in-home care. The benefit is the VA Non-Service Connected Aid & Attendance Pension, established in 1954 under section 38 USC to assist qualified veterans (and their surviving spouse).
BASIC ELIGILITY CRITERIA
The veteran must:
- Be discharged under other than dishonorable conditions
- Have 90 days or more active service, at least one day during a period of war
- Have limited income and net worth. (Less than $80,000 in liquid assets)
- Currently permanently and totally disabled, not due to willful misconduct of the Veteran
War Time Service Dates
- WWI April 6, 1917 – November 11, 1918
- WWII December 7, 1941 – December 31, 1946
- Korea – June 27, 1950 – January 31, 1955
- Vietnam – August 5, 1964 – May 7, 1975
- Persian Gulf – August 2, 1990 to a date to be determined
There are currently over 25 million veterans alive in the United States. There are over 9 million surviving spouses of veterans currently living in the United States. Many of these veterans and surviving spouses are receiving long term care or will need some type of long term care in the near future, and there are funds available from the Veterans Administration (“VA”) to help pay for that care. Unfortunately, many of those who are eligible have no idea that any type of benefits exist for them or that an attorney can help them become eligible.
Planning for the VA Aid and Attendance Benefit
VA Aid and Attendance eligibility planning should be done by someone who is qualified and knowledgeable to deal with the conflicting information regarding the VA benefit, as well as, the possible disqualification of Medi-Cal / Medicaid benefits should they ever be needed.
Veteran Service Organizations (VSOs) exist to provide free applications for veteran’s benefits, but they are not qualified to implement eligibility planning for VA pension benefits or subsequent Medie-Cal / Medicaid eligibility planning. Such planning requires assistance of a qualified VA certified elder law attorney.
Medical Needs Test
Expenses such as home care, assisted living or nursing home care are usually the trigger that allows medical deductions to qualify a veteran for a pension.
The Income Test
The household income of the veteran or the surviving spouse cannot exceed the Maximum Allowable Pension Rate (MAPR) for that category of application.
The Asset Test
As a general, cash-equivalent, household assets cannot exceed $80,000. A personal residence, automobiles for personal use, and personal property are exempted from the asset test. Assets can be transferred to a VA compliant irrevocable trust or to someone who is not a household member, or a portion of assets can be converted into income through an annuity, if the income test allows for the additional income.
Caution: Any transfers must take into consideration the Medi-Cal / Medicaid look-back rules should the benefit be needed within the look-back time-frame. This could cause a period of ineligibility for Medicaid which could be as long as five years.
The VA looks at a claimant’s total net worth, life expectancy, and income and expenses to determine whether the claimant should qualify for special monthly pension benefits. Unlike Medi-Cal / Medicaid, there is no look-back period and no penalty for giving assets away.
For a surviving spouse to be eligible for the widow benefit, the surviving spouse and the veteran must have been married for at least one year prior to the veteran’s death and never have remarried.
The Application Process
Applications can take eight months or more before the VA makes a decision. Once approved, the benefit is retroactive to the month after application submission. Having the proper documentation in place at the time of application (for example, discharge papers, medical evidence, proof of medical expenses, death certificate, marriage certificate and a properly completed application) can cut the processing time in half.
If you know of someone who may be eligible, please give us a call at 916-974-9393. Our team of specialists will first determine eligibility, then, can help the qualified veteran receive this tax-free benefit.