Citation Nr: 1228131 Decision Date: 08/15/12 Archive Date: 08/21/12 DOCKET NO. 10-04 122 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in St. Paul, Minnesota THE ISSUES 1. Whether the Veteran's Social Security income should be excluded as countable income for purposes of payment of nonservice-connected pension benefits. 2. Whether the Veteran's spouse's income should be excluded as countable income for purposes of payment of nonservice-connected pension benefits. ATTORNEY FOR THE BOARD James Alsup, Counsel INTRODUCTION The Veteran served on active duty from February 1971 to February 1973. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an August 2009 decision of the Department of Veterans Affairs (VA) Pension Management Center (PMC) in St. Paul, Minnesota. The Veteran was granted nonservice-pension benefits effective November 15, 2007, in a February 2008 rating decision by the RO. In the August 2009 decision, the Veteran's nonservice-connected payments were terminated because his countable income exceeded the regulatory maximum annual pension rate (MAPR). The Veteran disagreed and perfected an appeal. FINDINGS OF FACT 1. The Veteran reported he received Social Security disability payments as a source of income. 2. The Veteran reported that he and his spouse lived together from the effective date of nonservice-connected pension until August 3, 2009, at which time the spouse and Veteran separated, and that he paid spousal support thereafter. CONCLUSIONS OF LAW 1. The Veteran's Social Security disability benefits are countable income and the reduction in monthly nonservice-connected pension benefits by that amount was proper. 38 U.S.C.A. §§ 1503, 1521 (West 2002 & Supp. 2011); 38 C.F.R. §§ 3.3, 3.21, 3.23, 3.271, 3.272, 3.273 (2011). 2. The Veteran's spouse's income is countable income and the reduction in monthly nonservice-connected pension benefits by that amount was proper. 38 U.S.C.A. §§ 1503, 1521 (West 2002 & Supp. 2011); 38 C.F.R. §§ 3.3, 3.21, 3.23, 3.271, 3.272, 3.273 (2011). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran generally contends that VA should not have counted his Social Security benefits and his wife's earnings as countable income which combined to offset his nonservice-connected pension. Generally, regulations require VA to provide a Veteran with notice of how to substantiate a claim and with assistance in developing a claim for VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5106, 5107, 5126 (West 2002 & Supp. 2011); 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326 (2011). In this case, however, factual evidence is not dispositive of the Veteran's appeal. Rather, the application of the law and regulations to the undisputed facts is dispositive. The United States Court of Appeals for Veterans Claims has held that where the law as mandated by statute, and not the evidence, is dispositive, notice and development requirements are not applicable. See Mason v. Principi, 16 Vet. App. 129, 132 (2002). The Board notes that the Veteran was provided letters by the PMC, dated January and April 2009, which informed him that his spouse's income was included in what the Veteran had to report, and the VA Form-21-0516 specifically provides for disclosure of both Social Security payments and a spouse's income. Moreover, the Veteran was specifically questioned about such income in a March 2009 telephone conversation with a PMC representative. The record does not indicate that the Veteran has contended that he was not provided sufficient notice and the Board discusses below that the law provides that both types of income are countable income for pension purposes. Thus, any lack of notice would not prejudice the Veteran. The Veteran was granted nonservice-pension benefits effective November 15, 2007, in a February 2008 rating decision by the RO. Payments of pension benefits are subject to income limitation requirements. See 38 C.F.R. §§ 3.3(a)(v), 3.23 (2011). Payments of these pension benefits are made at a specified annual maximum rate, reduced on a dollar-for-dollar basis by annualized countable income. See 38 U.S.C.A. §§ 1503, 1521 (West 2002 & Supp. 2011); 38 C.F.R. §§ 3.3, 3.23. In determining annual income, all payments of any kind or from any source (including salary, retirement or annuity payments) shall be included except for listed exclusions. See 38 U.S.C.A. § 1503; 38 C.F.R. §§ 3.271, 3.272 (2011). Social Security Administration (SSA) benefits are not specifically excluded under 38 C.F.R. § 3.272 and they are, therefore, included as countable income. Certain medical expenses may be excluded from income to the extent that they were paid. 38 C.F.R. § 3.272(g). The MAPR, specified in 38 C.F.R. § 3.23, is published in Appendix B of VA Manual M21-1 and is to be given the same force and effect as if published in VA regulations. See 38 C.F.R. § 3.21 (2011). The MAPR is the amount of annual income that the Veteran and his spouse must not exceed in order to receive pension payments. The MAPR is adjusted from year to year and takes into account whether a Veteran has dependents or other conditions, such as in this case is in need of aid and attendance. In an August 2009 decision by the PMC, VA terminated the Veteran's nonservice-connected pension payments effective April 1, 2008, because his countable income exceeded the MAPR of $22,113 for a married Veteran with one dependent receiving special monthly pension benefits for aid and attendance. The PMC included in its calculation of the Veteran's countable income his SSA benefits and his wife's income as he reported it in information provided in January and February 2009 and in the March 2009 phone conversation. As noted above, the regulations providing for what income is countable income for purposes of VA pensions include payments made by SSA and include income earned by spouses. Essentially, "[p]ayments of any kind from any source shall be counted as income during the 12-month annualization period in which received unless specifically excluded under § 3.272." See 38 C.F.R. § 3.271(a). The exclusions included under § 3.272 do not include pension or retirement payments and, as previously noted, SSA benefits are not specifically excluded, and neither is income from a spouse. Moreover, 38 C.F.R. § 2.71(f)(2) provides that when a Veteran has a dependent but has not proven the dependency, VA shall determine pensions based on income that includes income of the unestablished dependent. Finally, 38 C.F.R. § 2.72 provides a specific exclusion for income of a child under certain circumstances, where as spousal income is not specifically excluded under any circumstance. In sum, the Board finds that the laws and regulations require VA to include SSA benefits and the Veteran's spouse's income in determining the Veteran's countable income for purposes of nonservice-connected pension benefits. The law is controlling and not the facts. The appeal must be denied as a matter of law. Sabonis v. Brown, 6 Vet. App. 426, 430 (1994). (The Board notes that, during the pendency of the appeal, the PMC sent the Veteran a December 2011 letter informing him that his nonservice-connected pension payments had been restored effective December 1, 2011. The change was on account of medical expenses offsetting the Veteran's countable income. This circumstance, however, does not change the fact that Social Security and spousal income must be included as countable income; therefore the present appeal is not affected.) ORDER Inclusion of the Veteran's Social Security disability benefits as countable income and the reduction in monthly nonservice-connected pension benefits by that amount was proper, and the appeal is denied. Inclusion of the Veteran's spouse's income as countable income and the reduction in monthly nonservice-connected pension benefits was proper, and the appeal is denied. ____________________________________________ RYAN T. KESSEL Acting Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs