New VA Pension Benefit Rules

Effective as of October 18, 2018, the VA has made changes to the Pension Benefit Rules in an effort to “maintain the integrity of the pension program.” These changes will impact Veterans and their surviving spouse’s eligibility for the VA Pension and the Veteran’s Aid and Attendance benefit that helps Veterans and their surviving spouses with long-term care assistance. Here are some relevant changes to keep in mind if utilizing the VA Aid and Attendance benefit as part of a long-term care plan:

Net Worth: Net Worth includes all income and assets and now has a clear maximum cap of $123,600.00 in 2018.

Assets: An applicant’s assets will be calculated by using the fair market value of all property owned by the claimant and any dependents, less mortgages or other encumbrances.

Asset Exclusions: Specifically excluded from assets are: the home, plus two acres, and personal effects.

Look-Back Period: Prior to 10/18/18 there was no look-back period, meaning, an applicant could transfer assets and immediately apply for the VA benefit without penalty. Now, there will be a 36-month look-back period triggered by the receipt of an original claim or a new claim following a period of non-entitlement. However, this look-back period will not apply to transfers made prior to 10/18/18.

“Covered Asset” Transfers: Only “covered assets” that are transferred will be penalized. A covered asset is considered to be an asset that was part of the claimant’s net worth and, if not transferred, would have caused net worth to be over the limit.

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