• Pixton Law Group



Veterans Day

We hope you take a moment today to remember the sacrifice that our military veterans have made. Their continuing service has brought a greater degree of peace and safety world-wide in very tumultuous times. In connection with that service, the Department of Veterans Affairs (VA) last month made new rules for pension benefits for wartime Veterans.

Why Did the VA Change the Rules?

Before these new rules, the VA offered little guidance on how they determined if an applicant was “in need.” Definitions were vague and explanations were limited; this led to confusion and inconsistent determinations. Now the VA has issued clear “bright-line” rules so we, as VA accredited attorneys, can better advise our clients what to expect.

Summary of the New Rules

Requirements for minimum active wartime duty, age or disability, remain much the same. But rules to determine if a Veteran is “in need” have changed. Here are some highlights:

• Net worth is now capped at $123,600 (the Medicaid standard) but INCLUDES annual income. This number will increase annually. So, assets + annual gross income = net worth. Out of pocket medical expenses can reduce income.

• The home is not counted in most cases.

• If a veteran has net worth over the threshold, we have strategies to “restructure” finances to get the calculation within the permitted range including certain qualified purchases and accounting for medical expenses.

• New rules apply to annuities and other financial instruments. Contact our office before investing in an annuity or other asset that produces income to consider possible ramifications of that purchase on VA pension benefits.

• There is now a 36 month “look back” period. Any asset transferred or given away for less than fair market value during the 36 months immediately preceding a VA pension application will result in a penalty period up to 5 years. Contact our office to discuss exceptions and strategies to cure or avoid the penalty.

Next Steps

These rules provide more certainty when applying for VA needs-based pension benefits. Give us a call if you would like to talk about the changes or explore how you or a family member may qualify.

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