Income and Asset Requirements
There are income and asset requirements to receive A&A. The test for assets is whether it is reasonable that some of the veteran’s estate be consumed to pay for care. In order to receive the maximum pension amount, the income test requires the veteran to have zero income or to be spending all monthly income on care costs.
The asset test was changed in 2018. To qualify, a veteran must have countable assets of less than $130,773. However, this figure includes the veteran's income in the current year. Certain assets, such as a home and an automobile, are exempt and do not count toward the total countable assets.
What Can I Do If My Assets Exceed Asset Requirements?
Also starting in 2018, the VA has imposed a 3 year look back on gifts . In other words, veterans may be disqualified from receiving benefits if they made gifts within 3 years of applying for benefits. If your assets exceed the limit but not by much, there are some planning opportunities that will allow you to qualify for benefits in the near future. If your assets significantly exceed the limit, it may now take planning many years in advance to qualify for benefits. If you are thinking of gifting assets to position yourself to qualify for benefits down the road, it is not recommended that you simply gift your assets outright. First, it exposes your assets to your beneficiaries’ creditors. Second, you may need to “undo” the gift. If your care needs advance and you later need nursing home care, it may become necessary to qualify for Medicaid. To qualify for Medicaid, your beneficiaries may need to return the gift to cancel Medicaid’s gifting penalties. An individual who receives an outright gift may be unable or unwilling to return the gift. In order to avoid these potential problems, we recommend that you gift your assets to an Irrevocable Trust. An Irrevocable Trust must meet specific requirement to not be countable for VA benefit purposes. We can create this trust for you with terms that mirror your estate plan and preserve your ability to later receive Medicaid benefits if necessary.
Filing a Claim
Filing a claim for A&A is complex and time consuming, Typically, qualification for A&A involves the reallocation of assets, which will impact Medicaid eligibility. This process should not be attempted without proper legal advice. It may take several months for an A&A Application to be approved by the VA; however, the benefits are paid retroactive to the month following the month in which the Application was filed.