About VA Benefits
About the Veteran Improved Pension and Additional Allowance for Aid & Attendance or Housebound
This document is intended for educational purposes and is not legal or financial advice. CHOICE Advisory Services, Inc. and its employees and representatives are held harmless for any injury, loss or harm which may occur as a result of interpreting information or lack of information contained within this document. You are encouraged to make direct contact with one of the accredited contacts listed below to gather information and to seek assistance. CHOICE can help you understand what housing & care providers exist in the community; however CHOICE Advisory Services, Inc. is NOT an accredited provider of Veteran’s information as it relates to application for benefits or long-term planning.
The database, this information and the laws regarding these matters may change. To obtain current and accurate information, discuss these matters with your trusted financial, legal and/or tax professional or discuss directly with an accredited representative of the Veteran’s Affairs.
Neither CHOICE Advisory Services, Inc. nor its employees derive any fee, commission or financial gain by referring you to agencies or professionals assisting with legal, financial or application services for Veteran’s benefits.
It is not legal for individuals or agencies to charge you a fee to help with completion or submission of your Veteran’s Benefit application. There should be no charge associated with this portion of your guidance from an Attorney or Financial Professional.
Any war-time veteran discharged under conditions other than dishonorable and having completed 90 days of active duty, one day beginning or ending during a period of war, is eligible to apply for the Veterans Improved Pension and additional allowance for either Aid & Attendance or Housebound benefit. A surviving spouse of a war-time veteran may also apply (marriage must have ended due to the death of veteran, and marriage must have occurred 12 months prior to death). If the marriage ends as a result of divorce, the non-veteran spouse no longer qualifies for a Death Pension. The individual applying must qualify both medically and financially. Periods of war which have been qualified by Congress appear below. For time frames after Sept. 7, 1980, please refer to the Veteran’s Administration web site: www.va.gov
To qualify medically, a war-time veteran or surviving spouse must require the assistance of another person to perform daily tasks, such as medication assistance, eating, dressing, undressing and taking care of personal needs such as grooming, bathing or toileting. Also eligible for such benefits are individuals with dementia/memory loss or who are blind and require the assistance of care giving staff.
Eligibility must be proven by filing the proper Veterans Application for Pension or VA Form 21-526 for Veteran and 21-534 for surviving spouse of a Veteran. This application requires a copy of DD-214 or separation papers, medical evaluation, or specific documentation from a physician and marriage license, if applicable. A financial disclosure including income and assets is required.
VA BENEFITS ARE NOT TAXABLE INCOME (figures noted are MAXIMUM payable amounts for 2014):
Married (both Vets) $2,716 per month (if both qualify for care and both are Veterans)
Married $2,085 per month (if Veteran qualifies for care and is married)
Single Veteran $1,758 per month (if Veteran qualifies for care)
Veteran with spouse $1,380 per month (if Veteran does not need care)
Surviving Spouse $1,130 per month with Aid & Attendance allowance
Periods of War
Only veterans with wartime service are eligible for non-service-connected disability pension benefits. To be considered by the VA to have served during wartime, a veteran need not have served in a combat zone yet the veteran must have been on active duty during one of these designated periods. All other times are considered peacetime. If a majority of a veteran’s service occurred during peacetime, the service member would still meet the wartime service requirement for eligibility for pension benefits if he or she served 90 consecutive days, at least one day of which occurred during a period designated as wartime.
The following list defines the periods of wartime designated by Congress for pension purposes.
Declared War | Wartime | Descriptions |
Mexican Border War | 5/9/1916 – 4/5/1917 | The Veteran must have served for one day or more in Mexico, on the borders thereof, or in the waters adjacent thereto |
World War I | 4/6/1917 – 11/11/1918 | Service after November 11, 1918 – July 2, 1921, qualifies for benefits purposes if active duty was performed for any period during the basic World War I period |
World War I (ext) | Extended to 4/1/1920 | For those who served in the Soviet Union |
World War II | 12/7/1941 – 12/31/1946 | |
World War II (ext) | Extended to 7/25/1947 | Where continuous with active duty on or before 12/31/1946 |
Korean Conflict | 6/27/1950 – 1/31/1955 | |
Vietnam Era | 8/5/1964 – 5/7/1975 | 2/28/1961 – 8/5/64 for vets who served in Republic of Vietnam during that period |
Persian Gulf War | 8/2/1990 – | The end date to be prescribed by Presidential proclamation |
Congress has not enacted legislation that would make the periods covering the 1983-1984 Lebanon crisis or the invasions of Grenada and Panama wartime service.
Furthermore, the veteran or couple applying for Improved Pension must qualify from an income and asset standpoint. Generally speaking, the asset maximum is set at approximately $40,000 (Note: This figure may be different at the time of application. It is also important to note that this figure may be higher according to some sources.) You should discuss the specific positioning of assets with your chosen financial or legal professional before applying for Improved Pension benefits as the maximum allowable asset amount may vary based on other criteria.
Note: If the Veteran or surviving spouse is already in receipt of the Improved Pension/Death Pension but not receiving additional allowance for Aid & Attendance or Housebound, a request for either of these two allowances can be accomplished by submitting VA Form 21-4138 and a signed physician’s diagnoses of disabilities.
Benefit amounts appearing earlier in this document under the heading of “MAXIMUM benefits paid” are based on gross income less allowable expenses. As an example, some of the allowable deductions are: payments for Medicare parts B and D, supplemental insurance premiums, payments for prescription expenses not covered by insurance, and expenses related to health care practitioners (such as in-home care, assisted living, adult family home care or skilled nursing care).
Every individual’s and couple’s situation is unique, and these computations can be complicated. Seeking the guidance of a qualified Veteran’s specialist will likely give you the clarity you are likely seeking.
Long-term Care Planning with an Attorney (when assets exceed maximum allowable parameters)
Your legal professionals such as attorneys or tax planning professionals such as a CPAs may recommend you consider the implementation of one or more estate or financial planning strategies to meet the requirements of the Veteran’s Administration.
Implementation of estate planning is sometimes a controversial issue, as legal repositioning of assets occurs to allow the Veteran to apply for benefits earlier than possible without this type of planning. Much like financial planning, tax planning and Medicaid planning, many opinions and misinformation exists in our community. Working with a knowledgeable attorney, you will be given insight as to your specific options.
Attorneys most often review the need for and provide information regarding all possible legal documents beneficial to an individual or couple, such as a Durable Power of Attorney, Advance Directives and Wills or Trusts. As pricing from attorney to attorney can vary, it is advisable to obtain one or more price quotes before enlisting the services of specific legal representative. The credentials, experience and involvement of the attorney in veteran-specific and aging services is also important.
You may consider enlisting the help of a credentialed and approved attorney to create an irrevocable trust to reposition your assets, which will help expedite the application for Improved Pension/Death Pension and/or Medicaid Benefits. An irrevocable trust is a separate legal entity in which assets are held. For example, an annuity, stock portfolio, CDs, bonds or even real estate can be retitled in the name of the trust entity. Assets retitled in the name of the trust are managed by a named trustee or trustees. The named trustee is an individual other than the VA applicant(s) such as one or more adult children or other trusted representative.
Note: The Veteran’s Administration will expedite a claim adjudication only in instances where the application is diagnosed as terminally ill with life expectancy of less than six months.
Frequently one or more adult children are listed as Trustee(s), yet any individual, other than the VA applicant(s) or entity can be named as trustee of an irrevocable trust. For example, a business or agency (such as a guardianship agency) can be named trustee.
The trustee of an irrevocable trust has legal title to the property of the trust, but the beneficiary(-ies) retain equitable title to the assets. The trustee has the fiduciary responsibility to utilize the asset(s) and earnings from the assets according to the terms set out in the Trust Agreement of the VA Applicant(s).
Because of the complexities of the irrevocable trust, and because older adults and their families must make decisions regarding the specific assets and income from these assets, it is advisable to work directly with an Elder Law Attorney to create and fund the trust. (Funding means placing correct title on assets and recording such titling)
Possible benefits of having an irrevocable trust:
- If there are cognitive issues with the senior, a future guardianship can be avoided, which avoids the need to go to the court to obtain approval for expenditures
- No probate is required when the older adult dies
- Adds an additional layer of fiduciary responsibility ensuring that the assets in the trust are held for the benefit of the beneficiaries and are not subject to claims against the Trustee(s)
- Assets are protected from creditors’ claims
- An irrevocable trust can aid in prequalification for government assistance, including Medicaid, in the future if the document is properly drafted.
At the date appearing at the top of this document, there is currently no “look back” period for assets moved into a trust to apply for Improved Pension/VA Benefits (note that there is currently a five year look back period for Medicaid). Assets can currently be placed in the name of the trust and therefore become exempt from counting towards the maximum allowable asset amount. Real property, such as a home, can also be placed in the trust. Seek the guidance of your attorney if the home is to be sold in the near future or death of the veteran is anticipated as there are tax ramifications applicable to these topics.
IRAs and Roth IRAs cannot be retitled in the name of a trust without often harsh tax ramifications, yet they can be rolled over into financial instruments which do meet the requirements of the Veteran’s Administration. You may wish to discuss the benefits of moving such funds to an investment such as a Single Premium Immediate Annuity. Because of the complexities of this matter coupled with the fact that every individual or couple has unique circumstances, it is advisable to consider all of your options with the inclusion of a financial, legal and tax professional.
Income Planning with a Financial Professional (when assets or income exceed maximum allowable parameters)
In lieu of the option of spending down assets or following a legal process for gifting assets, an attorney or financial professional may offer the option of retitling or repositioning assets into annuities. Annuities are similar to Certificates of Deposit with a Bank, only they are financial instruments sold by insurance companies. Be certain to discuss the specifics of the financial instrument you are considering with your legal, financial and tax professionals.
Many types of annuities exist, and some have fees associated with the set up and/or access to funds. Many older adults prefer placing their funds in annuities which have guarantees to ensure against any loss of principal. Options exist which have no up-front fees and which give certain access to funds without penalty.
Be sure to review the credentials, experience and references of your selected Financial Professional. Also review closely the disclosure statement and materials they provide you. It is common within the financial industry to receive commissions from the insurance company where an annuity is placed – this is how some Financial Professionals can assist you without charging an hourly fee for their assistance. Other Financial Professionals (such as a Certified Financial Planner) charge a fee-for-service to give you guidance on an hourly basis regarding financial and investment options. It is of benefit to you to work with a financial professional with favorable references and associations and specific education in the parameters of the Aid & Attendance Benefit.
Veteran’s Benefits Specialists
There are three known types of people who assist with Veteran Benefit applications:
- Attorneys – Fee for service to create legal documents (Attorneys – as are all individuals and companies – are prohibited by law to charge a fee to complete the application process)
- Financial Services – no fee to consumer, these professionals are paid via commission from the insurance company if financial products are sold
- Veteran Service Officers – no fee, Veteran’s Administration accredited organizations or individuals working for accredited organizations to assist with these matters. Although twelve such contractors currently exist, it is likely helpful for you to begin with the Washington state sponsored agency called Veterans Services Administration by calling toll-free: 1-800-562-2308 or visit their web site at dva.wa.gov/service_officers.html
This office has a small team located in Olympia, who can help you by phone. If you need more personalized help, they will refer you to one of the twelve contracted Veteran Service Organizations and/or Independent Service Officers.
Note: Not all Veterans Services Officers are supportive of the services offered by attorneys or financial professionals. It is important to note that a number of veterans served by such agencies or individuals may not have assets, so their understanding of the legal opportunities for estate or financial planning may be limited or may vary from financial or legal professionals who mainly serve clients who have assets.
The application
The form required to apply for Veteran Benefits can be obtained by any Veteran Service Officer or from other professionals helping older adults with this process. It is not advisable to utilize the on-line version of the application.
Be certain to attach all necessary and requested copies to verify income, assets, honorable discharge and other items noted in the application.
Physician(s) statements
The Veteran’s Administration requires that all illnesses and diseases should be included in your application.
It is critical that your health care professional understand the importance of the document they are completing. Incomplete or incorrect information could cause delay or decline of benefits.
The Application Processing Period and Retroactive Payments
All applications from residents of Washington State are processed in St. Paul, Minnesota. Unfortunately, this same office processes applications from twenty other states. With the demands placed on this office, it can take 8 to 12 months to receive approval for this benefit.
The VA will date stamp your application when received. Most frequently the date stamp is based on the 1st of the next month following receipt of your fully completed application (with all necessary accompanying documents). For example, if the VA receives your application on May 5th, the benefit will likely begin accruing on June 1st.
Once approved, the VA pays retroactively to the stamped date appearing on your application.
For example, if it takes seven months to approve an application for a couple and the couple qualifies for the maximum benefit, the VA is likely to send retroactive payment of: 7 months X $2,054 benefit for a couple = $14,378.
Not all applicants are granted the maximum amount of the stated benefit. Allowable expenses are deducted from income to yield an amount which may be smaller than the maximum benefit available.
Unique Experience If There Is a Diagnosis of Dementia, Memory Loss or Alzheimer’s Disease
This benefit is intended for veterans who are either physically frail and need assistance with activities of daily living, or for veterans who have cognitive impairments. When a physician notes a diagnosis involving possible or actual memory loss, the Veteran’s Administration may require an additional review of the older adult’s application as well as review of the Trustee(-s) by a VA appointed individual. This additional fiduciary step can cause additional delays.
The VA may consider approving the application, but may hold any retroactive payments due until such time that this fiduciary process can be completed. The VA is taking this additional precautionary step to ensure that the older adult(s) and/or their legally responsible parties have reviewed the competency of the older adults, and that informed decisions have been made to ensure the safety and well-being of the Veteran and/or spouse.
Annual review
An EVR is required annually (Eligibility Verification Report). This is a simplified VA document which asks for annual information regarding income, assets and expenses. It is a highly simplified form in comparison to the initial Improved Pension application.
Other information
If someone has been denied a claim in the past for Improved Pension or Death Pension, they may apply again one calendar year later. Common reasons for denial:
- The application was not completed correctly
- Requested documentation/proof was not included in the application
- Necessary physician(s) reports were not included in the application
- The veteran or responsible party did not comply with laws regarding gifting or the repositioning of assets
- Income or assets is/are higher than allowable
Merchant Marines may now apply for this benefit.
If a Veteran does not have available a copy of discharge papers, there is a form available to order a certified copy. It takes 2-3 weeks to receive this document once the form is submitted. To access this form: archives.gov
Medicaid/COPES In Addition to Veteran’s Benefits
Although it is possible to apply for Aid & Attendance as well as Medicaid, under the current Medicaid Recovery Act, the State of Washington would ask for the funds from the VA to be given to the state; therefore, there is currently no known benefit to the Veteran to apply for both benefits.
The laws and subsequent planning for Medicaid/COPES are completely different than the laws and planning for Veteran’s Aid & Attendance benefits.
Additional Resources:
Veterans Service Organizations and Independent Service Officers:
http://dva.wa.gov/service_officers.html
To search for Accredited Attorneys, Claims Agents or Veteran Service Organization Representatives:
http://va.gov/ogc/apps/accreditation/index.asp
US Department of Veterans Affairs web site regarding pensions:
http://vba.va.gov/bln/21/pension/vetpen.htm
Frequently asked questions regarding accreditation
US Department of Veterans Affairs:
http://va.gov/ogc/accred_faqs.asp
Seattle Regional Office, US Department of Veterans Affairs:
915 2nd Ave, Seattle, WA 98174
Phone: 800-827-1000
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