Citation Nr: 1754920 Decision Date: 11/30/17 Archive Date: 12/07/17 DOCKET NO. 16-61 771 ) DATE ) ) On appeal from the Department of Veterans Affairs Pension Management Center in St. Paul, Minnesota THE ISSUE Whether the Veteran's annual countable income is excessive as to bar entitlement to nonservice-connected (NSC) disability pension benefits. ATTORNEY FOR THE BOARD M. Yacoub, Associate Counsel INTRODUCTION The Veteran had active air service from November 1960 to November 1964. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a June 2016 decision of the Department of Veterans Affairs (VA) Pension Management Center (PMC) in St. Paul, Minnesota. This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900 (c) (2017). FINDING OF FACT Even considering deductions for unreimbursed medical expenses, the Veteran's countable income has exceeded the maximum annual pension rates (MAPRs) for the period on appeal based on his Social Security income. CONCLUSION OF LAW The Veteran's annual countable income is currently excessive for purposes of receipt of nonservice-connected pension benefits. 38 U.S.C. §§ 1503, 1513, 1521, 1522, 1541, 1542, 5103, 5103A (2012); 38 C.F.R. §§ 3.3, 3.23, 3.271, 3.272, 3.274, 3.275 (2017). REASONS AND BASES FOR FINDING AND CONCLUSION Disability pension will be paid to a Veteran of a period of war who meets statutorily-defined service, net worth, and annual income requirements; and who is permanently and totally disabled from a non-service-connected disability that is not the result of willful misconduct. 38 U.S.C. §§ 1502, 1503, 1521; 38 C.F.R. § 3.3. The purpose of VA pension benefits is to provide a subsistence income for veterans of a period of war who are totally disabled and who are otherwise unable to maintain a basic, minimal income level. Pension benefits are based upon total family income and the amount of pension benefits is adjusted based upon the number of dependents the veteran supports. Recipients of pension income are required to report any changes in income and number or status of their dependents in a timely fashion. 38 U.S.C. §§ 1521, 1522 (2017). The rate of pension payable to an entitled payee is based on the amount of countable income received. Pension is payable at a specified annual maximum rate, which is reduced on a dollar for dollar basis by income on a 12-month annualized basis. 38 U.S.C. §§ 1503, 1521 (2012); 38 C.F.R. §§ 3.3, 3.23 (2017). The maximum annual rate of pension is established by statute every year and is reduced by the veteran's countable annual income. "Annual income" includes the veteran's own annual income, and, where applicable, the annual income of a dependent spouse and, with certain exceptions, the annual income of each child of the veteran in his custody or to whose support the veteran is reasonably contributing. 38 C.F.R. § 3.23(d)(4). The maximum annual rates of improved pension are specified by statute in 38 U.S.C. § 1521, as increased from time to time under 38 U.S.C. § 5312. Each increase of the maximum annual rates of improved pension under 38 U.S.C. § 5312 is published in the "Notices" section of the Federal Register. 38 C.F.R. § 3.23(a). For purposes of calculating pension benefits, total income may be reduced by amounts equal to amounts paid by a veteran for unreimbursed medical expenses. Unreimbursed medical expenses will be excluded when all of the following requirements are met, i) they were or will be paid by a Veteran or spouse for medical expenses of the Veteran, spouse, children, parents, or other relatives for whom there is a moral or legal obligation of support; ii) they were or will be incurred on behalf of a person who is a member or a constructive member of the Veteran's or the spouse's household; and iii) they were or will be in excess of 5 percent of the applicable maximum annual pension rate or rates for the Veteran (including increased pension for family members, but excluding increased pension because of need for aid and attendance or being housebound) as in effect during the 12-month annualization period in which the medical expenses were paid. 38 U.S.C. § 1503(a)(8); 38 C.F.R. § 3.272(g). For an original claim for pension, the initial annualization period extends from the date of receipt of the claim through the end of the month that is 12 months from the month during which entitlement arose. In determining annual income, all payments of any kind or from any source shall be counted as income during the 12-month annualization period in which received unless specifically excluded under 38 C.F.R. § 3.272. Recurring income, received or anticipated in equal amounts and at regular intervals such as weekly, monthly, quarterly, and which continue throughout the entire 12-month annualization period, will be counted as income during the 12-month annualization period in which it is received or anticipated. 38 C.F.R. § 3.271 (a) (1). Nonrecurring income, received or anticipated, on a one-time basis during a 12-month annualization period, will be counted as income for a full 12-month annualization period following receipt of the income. 38 C.F.R. § 3.261 (a) (1), (3). The amount of any nonrecurring countable income received by a beneficiary shall be added to the beneficiary's annual rate of income for a 12-month annualization period commencing on the effective date on which the nonrecurring income is countable. 38 C.F.R. § 3.273 (c). Under 38 C.F.R. § 3.272, the following shall be excluded from countable income for the purpose of determining entitlement to improved pension: welfare; maintenance; VA pension benefits, payments under Chapter 15, including accrued pension benefits; reimbursement for casualty loss; profit from sale of property; joint accounts (accounts in joint accounts in banks and similar institutions acquired by reason of death of the other joint owner); and medical expenses in excess of five percent of the MAPR, which have been paid. Disability benefits resulting in income from the Social Security Administration (SSA) are not specifically excluded under 38 C.F.R. § 3.272, and therefore are included as countable income. The MAPR is published in Appendix B of VA Manual M21-1 (M21-1) and is to be given the same force and effect as if published in VA regulations. 38 C.F.R. § 3.21. The Board notes initially that based on statements from the Veteran, there does not appear to be any dispute with regard to the income amounts as it applies to entitlement to nonservice-connected pension benefits. The Veteran filed a claim for nonservice-connected pension in June 2016. He reported SSA monthly benefits of $1,442.00 for himself, and $1,461.90 per month for his spouse. Effective June 1, 2012, the MAPR for a Veteran with one dependent was $18,051.00. 38 C.F.R. § 3.23 (a) (1). The Veteran was receiving $17,304.00 in SSA benefits annually, and his spouse was receiving $17,542.80 in SSA benefits annually, with a trust income of $5,640.96 annually, totaling $40,487.76 annually. The Veteran did not report any medical expenses but nonetheless, consideration was given to his spouse's expenses for Medicare Part B, which totaled $1,258.80, with a 5 percent medical expense deduction of $842.00, totaling a deduction of $416.80 for allowable medical expenses. This deduction brought his annual countable income to $40,070.96. The Board notes that in a letter dated January 2017, VA requested additional information from the Veteran with regard to his income and expenses for the appeal period; however, the Veteran responded only with a letter stating that he had attended a seminar which notified him of his rights to nonservice-connected pension for having served during wartime, and that he did not have $20,000 in his checking account. Besides that letter, the Veteran has not provided any further information that would allow VA to recalculate his entitlement to nonservice-connected pension benefits. Based on the Veteran's SSA based income on a yearly basis and without any further information regarding medical expenses, his countable income would exceed the maximum allowable income limit for VA purposes for a Veteran with only one dependent. Therefore, the Veteran's reported annual income has exceeded the MAPR as established by Congress. While the Board can certainly empathize with any financial difficulty the Veteran is experiencing, the Veteran is not entitled to payment of VA pension benefits because his income exceeds the statutory limit. Although recognizing the Veteran's honorable wartime service, the Board is nonetheless bound by the laws enacted by Congress, the regulations of the Department, the instructions of the Secretary, and the precedent opinions of the chief legal officer of the Department. 38 U.S.C. § 7104 (c). In this case, the law passed by Congress specifically prohibits the payment of VA pension benefits when the Veteran's income exceeds certain levels. The Court has held that where the law and not the evidence is dispositive, the claim should be denied due to the lack of entitlement under the law. Because the Veteran's countable income exceeds the statutory limits, he is not legally entitled to the payment of pension benefits, regardless of his honorable service or the current status of his checking account. Therefore, the Veteran's claim must be denied. Sabonis v. Brown, 6 Vet. App. 426 (1994). ORDER Entitlement to nonservice-connected pension is denied. ____________________________________________ Kristin Haddock Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs