Citation Nr: 18160094 Decision Date: 12/21/18 Archive Date: 12/21/18 DOCKET NO. 10-44 345A DATE: December 21, 2018 ORDER Entitlement to nonservice-connected death pension benefits after October 1, 2009 is denied. FINDINGS OF FACT 1. The appellant’s net worth prior to May 1, 2018 served as a bar to non-service connected death pension benefits. 2. For relevant time periods, the appellant failed to comply with VA’s requests to submit a valid VA Form 21-5427 Corpus of Estate Determination. 3. The appellant’s countable annual income for the 2018 calendar year exceeded the maximum annual death pension rate (MAPR) that applies to a surviving spouse without any dependents. CONCLUSION OF LAW The appellant is recognized as the surviving spouse of the Veteran, but she does not meet the income criteria for receipt of payment of nonservice-connected death pension benefits after October 1, 2009. 38 U.S.C. §§ 101, 103, 1503, 1521, 1541, 5110 (2012); 38 C.F.R. §§ 3.1(j), 3.3, 3.5, 3.23, 3.50, 3.271, 3.272, 3.277, 3.400, 3.1000 (2017). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty from October 1950 to August 1952. He died in September 2008. The appellant is his surviving spouse. The Board remanded the matter in September 2017 to allow the appellant the opportunity to complete and submit Form VA 21-5427. The Board finds that the remand directives have been substantially complied with and therefore will adjudicate the matter. Stegall v. West, 11 Vet. App. 268 (1998). The RO granted death pension benefits, effective September 1, 2008 and discontinued the pension benefits, effective October 1, 2009. The RO discontinued the pension benefits, stating that the calculated income exceeded the limits set by VA law for death pension. See June 2013 notification letter. Nonservice-connected death pension benefits are generally available for surviving spouses as a result of the Veteran’s nonservice-connected death. 38 U.S.C. § 1541 (a). Basic entitlement exists if (i) the Veteran served for 90 days or more during a period of war; or (ii) was, at the time of death, receiving or entitled to receive compensation or retirement pay for a service-connected disability, and (iii) the surviving spouse meets the net worth requirements of 38 C.F.R. § 3.274 and has an annual income not in excess of the maximum annual pension rate (MAPR) specified in 38 C.F.R. §§ 3.23 and 3.24. See 38 C.F.R. § 3.3(b)(4). A surviving spouse who meets these requirements will be paid the maximum rate of death pension, reduced by the amount of countable income. 38 U.S.C. § 1541; 38 C.F.R. § 3.23. In determining income for this purpose, payments of any kind from any source are counted as income during the 12-month annualization period in which received unless specifically excluded. 38 U.S.C. § 1503; C.F.R. § 3.271. The maximum annual rate of improved pension for a surviving spouse is specified by statute and is increased periodically under 38 U.S.C. § 5312. See 38 C.F.R. § 3.23. In determining annual income, all payments of any kind or from any source (including salary, retirement or annuity payments, or similar income, which has been waived) shall be included except for listed exclusions. See 38 U.S.C. §1503 (a); see also 38 C.F.R. § 3.271(a). Wage/salary income and retirement pension benefits from private companies are not specifically excluded under 38 C.F.R. § 3.272; such income is therefore included as countable income. Medical expenses in excess of five percent of the applicable maximum annual pension rate (MAPR), which have been paid, may be excluded from an individual’s income for the same 12-month period, to the extent they were paid. 38 C.F.R. § 3.272(g)(2)(iii). Expenses of last illnesses, burials, and just debts that are paid during the calendar year following that in which death occurred may be deducted from annual income for the 12-month annualization period in which they were paid or from annual income for any 12-month annualization period which begins during the calendar year of death, whichever is to the claimant’s advantage. 38 C.F.R. § 3.272(h). Otherwise, such expenses are deductible only for the 12-month annualization period in which they were paid. Id. The Board notes that the appellant has provided proof of paying expenses related to the Veteran’s burial expenses. VA paid the appellant the maximum allowed for a death not related military service. See October 2008 notification letter. 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. See 38 C.F.R. § 3.21. The MAPR is adjusted from year to year. If the appellant’s income is less than the MAPR, VA will pay benefits to bring her income up to that level. For the year of 2018, the MAPR for a surviving spouse with no dependents is $9078 (effective December 1, 2018). To be deducted, medical expenses must exceed five percent of the MAPR, or, $453.00. Payment to a surviving spouse shall be denied or discontinued if the corpus of the estate is such that under all the circumstances, including the income of the surviving spouse, it is reasonable that some part of the estate be consumed for the surviving spouse’s benefit. 38 U.S.C. § 1543; 38 C.F.R. § 3.274. There is no specific dollar limitation on net worth (as opposed to income) that bars an otherwise eligible claimant from receiving pension benefits under 38 C.F.R. § 3.274. However, as a general rule, the rating agency will undertake development action to determine if net worth is excessive for any claimant who has an estate of $80,000 or greater. In her March 2009 notice of disagreement, the appellant reported that her income as $686.00 per month as of January 2009. In her VA Form 21-8416 Medical Expense Report, received in October 2010, the appellant submitted a list of receipts showing that she paid $620.70 for medications from October 2009 through September 2010. In a hand-written letter submitted November 2010, the appellant lists the inheritance as $80,096.90 between December 11 and January 2010. In the Improved Pension Form submitted November 2010, the appellant reported $686.00 a month from Social Security and an inheritance of $89,1.0023 from her husband. She also stated that she had $53,501.11 remaining as of November 2010 and $157.00 in checking. In hand written correspondence submitted November 2010, the appellant listed her expenses as $2,039.00 for fuel, $900.00 for a root canal, $406.00 for car and home maintenance, and $216.00 twice a year for teeth cleaning. The appellant reported that she takes $800.000 to $1,000.00 out of her savings every month. In VA Form 9 submitted November 2010, the appellant stated that she receives $686.00 a month and her root canal cost $1200.00. She also stated that every month she has to take money out of her savings. Social Security Inquiry Results submitted November 2010 show monthly payments of $782.50 in 2009 and 2010. In December 2010, the appellant submitted VA Form 21-0518-1, Improved Pension Eligibility Verification Report, wherein she reported that she receives $686.00 per month as of January 1, 2009 ($782.50 from Social Security, minus $96.50 for Medicare Part B), that she had received $89,123.71 as inheritance from her deceased husband, and that she had $157.81 in her checking account and $53,001.14 in her money market account as of November 2010. In hand written correspondence submitted September 2011, the appellant reported that she had interest on money market, plus the interest accrued totaling $751.26 in 2008, $133.60 in 2009, $503.71 in 2010, and $186.93 in 2011. In her VA Form 5655, Financial Status Report, submitted in October 2015, the appellant reports that her income is $746.00 or $776 per month, and her total expenses are $598.72 per month. She stated that as of the end of September 2015 her bank account’s balance was $83,714.38 and checking account balance as of mid-October 2015 totaled $152.56. Bank statements submitted May 2018 reflect statement balances as of May 1, 2018 for the appellant’s checking account as $1,559.37 and $34,235.42 for the appellant’s savings account. A May 2018 VA determination concluded that the appellant’s net worth is not a bar to the death pension benefits as of May 1, 2018. It was also noted that the Veteran submitted an unsigned copy of the VA Form 21-5427, Corpus of Estate Determination, and therefore that form was deemed invalid. In the VA Form 21P-0518-1 Improved Pension Eligibility Verification Report (Surviving Spouse with no children) submitted June 2018 the appellant stated that she receives $774.00 a month from Social Security, $140.00 from interest and dividends, and it appears that she indicated another $895.00 from “SSA”. She listed her net worth as $140.00 cash/non-interest-bearing bank account and $32,447.00 (savings) from interest bearing bank account. In the Medical Expense Report submitted June 2018 the appellant reported the following monthly expenses: $125.00 for Medicare and $142.26. She also stated that she traveled 8 miles to get to her doctor’s office. In the Request for Details of Expenses Report submitted June 2018 the appellant reported the following monthly non-medical expenses: $275.00 for rent and utilities, $400.00 for food, $9.37 and $167 for car expenses, $12.82 for interest, and $150.00 for clothing. In a July 2018 deferred rating decision, the RO granted a partial grant regarding the appellant’s income as a bar to benefits. The RO stated that her net worth is no longer a bar as of May 1, 2018. Social Security Inquiry Results submitted in August 2018 show monthly payments of $810.90 in 2011, $824.90 in 2012, $836.90 in 2013, $850.90 in 2014 and 2015, $854 in 2016, and $871 in 2017. As stated above, the Board remanded the matter to obtain VA Form 21-5427, Corpus of Estate Determination. In a May 2018 deferred rating decision, the RO was directed to send VA Form 21-5427 to the appellant. VA sent development letters in May and June 2018. The appellant submitted this form in May 2018, twice. However, neither copy is signed. At the outset, there is no issue as to whether the Veteran served for the requisite time or whether the appellant is his spouse. The evidence reflects that the Veteran served on active duty from October 1950 to August 1952, i.e., during a period of war (Korea era) for more than 90 days. 38 U.S.C. § 101 (29)(B); 38 C.F.R. § 3.2(f). He passed way in September 2008 and the appellant is the Veteran’s surviving spouse for VA death benefits purposes. See 38 U.S.C. § 101(3); 38 C.F.R. § 3.50(b). As the appellant first filed her claim in September 2008 and she timely appealed the February 2009 rating decision, the appeal period commences September 2008. The RO did not suspend the pension until October 1, 2009. As such, the issue before the Board is whether the appellant meets the specific income outlined above as of October 2009. See 38 U.S.C. § 1541; 38 C.F.R. § 3.3 (b)(4). In addition, the Board will look at the appellant’s net worth to determine whether it is excessive for purposes of qualifying for VA death pension benefits. Between October 2009 to April 2018, the appellant has consistently reported a net worth of over $80,000.00. She received an inheritance from the Veteran and has reported that amount to be as high as $89,123.00. As stated above, payment to a surviving spouse shall be denied or discontinued if it is reasonable that some portion of the corpus of the estate will be consumed for the surviving spouse’s benefit. Although there is no specific dollar limitation on net worth that bars an otherwise eligible claimant from receiving pension, the rating agency is to undertake development action to determine if net worth is excessive for any claimant who has an estate of $80,000.00 or greater. Here, the appellant’s net worth prior to May 2018 has been over $80,000.00. In addition, she has consistently reported that she regularly withdraws from her account in order to pay her living expenses. As such, the Board finds that the appellant is not entitled to death pension benefits prior to May 2018, as her net worth is considered excessive for VA purposes. Reviewing the evidence as of May 2018, the Board finds that the appellant’s net worth is no longer a bar to receipt of the death pension benefits. The issue before the Board is whether, as of May 2018, the appellant’s income falls within the prescribed amounts. As stated above, the appellant’s net worth as of May 2018 consists of $1559.37 in her checking account and $34,235.42 in her savings account. In the Eligibility Verification form the appellant reported an annual income of $9288.00 ($774.00 a month from SSA), $140.00 a year from interest and dividends, and $895.00 a year from another source. SSA and user calculations shows that the annual amount received from SSA is $10,452.00 ($871.00 a month). As the SSA inquiry is objectively more reliable the Board will use the $871.00 as the monthly amount received. Her total annual income for 2018 is $11,487.00 ($10,452.00 + 140.00 + 895.00). As stated above, the period under consideration is between May 2018 and December 2018, as the appellant’s net worth was a bar to benefits prior to May 2018. As such, when assessing the amount to deduct from the appellant’s annual income, the medical expenses that fall between May 2018 and December 2018 will be considered. As stated above, unreimbursed medical expenses in excess of five percent of the MAPR, which have been paid, may be excluded from an individual’s income for the same 12-month annualization period to the extent they were paid. 38 C.F.R. § 3.272 (g)(1)(iii). Moreover, medical insurance premiums themselves, as well as the Medicare deduction, may be applied to reduce countable income. Effective December 1, 2018, the MAPR for a surviving spouse with no dependents was $9,078.00. To be deducted, medical expenses must exceed five percent of MAPR, or, $453.00. Here, there is no indication beyond the appellant’s one time reporting that she actually paid $142.26 a month in out of pocket medical expenses. The only receipts submitted that indicate out of pocket fees were paid show that she paid $620.70 for medications from October 2009 through September 2010. That totals approximately $56.00 a month. Given that the there is no probative evidence of record to show that the appellant paid $142.26 a month from May 2018 to December 2018, the Board is unable to use this amount when totaling up the medical bills to be deducted from the appellant’s annual income. However, even if the Board conceded that the appellant paid such amount monthly, her income would still exceed the 2018 MAPR. Her 2018 annual income would total $9797.56, which exceeds the MAPR limit of $9,078.00. As stated above, the appellant’s total income for 2018 is $11,487.00. Allowable medical expenses, such as Medicare premiums and travel to a medical office, totaled as $1004.36 minus five percent of MAPR, which was $453.00, making countable medical expenses total $551.36. Total income minus countable medical expenses equals $10,935.64. This exceeds the MAPR for 2018. The Board will also discuss and consider the calculations that the RO detailed in their September 2018 supplemental statement of the case and the user calculations submitted August 2018. It appears that the RO used the same annual income calculations as the Board but had different figures for the total medical expenses. For the period covering May 2018 to December 2018 they added the following: $125.00 per month in Medicare and a one-time expense of $142.46 and $4.36 for travel reimbursement, totaling $1,146.62. They then accounted for January 2019 to May 2019 and added $125.00 per month totaling $625.00. This resulted in a total in medical expenses of $1771.00. However, it appears that the RO used the MAPR limits that became effective December 1, 2016 and not those for the calendar year 2018. As such, the Board will use their calculations, but use the 2018 MAPR, as it favors the appellant. The appellant’s total income for 2018 is $11,487.00. Allowable medical expenses, such as Medicare premiums and travel to a medical office, totaled $1771.00 minus five percent of MAPR, which was $453.00, making countable medical expenses total $1318.00. Total income minus these countable medical expenses equals $10,169.00. This would still exceed the MAPR for 2018. The Board finds that service connection cannot be granted for non-service connected death pension benefits in the current case. While it appears that the appellant qualified for a non-service connected death pension at the time of her initial application and she was granted the pension benefits until October 2009, the probative evidence of record shows that her net worth was excessive and barred her from benefits from October 2009 to May 1, 2018. Thereafter, her income exceeded the MAPR limits. The appellant did not provide valid verification of her net worth and it is noted that she did not submit any records prior to May 2018 regarding a change in her assets and income. The Board reminds the appellant that the duty to assist is not a “one-way street.” Wood v. Derwinski, 1 Vet. App. 190, 193 (1991). Significantly, in the current situation, the burden is on the appellant to demonstrate that her net worth was not excessive prior to May 2018 and that her annual income is below the maximum allowable rate for receipt of death pension. The Board finds the appellant has not met her burden at any time during the appeal period and the claim must be denied. In making the determination above, the Board has considered the provisions of 38 U.S.C. § 5107(b) regarding benefit of the doubt, but there is not such a state of equipoise of positive and negative evidence to otherwise grant the appellant’s claim. See 38 U.S.C. § 5107(b); 38 C.F.R. § 3.102. The appellant is thus precluded from receiving death pension benefits due to her excessive net worth prior to May 2018 and exceeding the maximum allowable pension rate for a surviving spouse. Accordingly, for reasons and bases expressed above, the preponderance of the evidence is against the claim, and the benefit-of-the-doubt doctrine does not apply. 38 U.S.C. § 5107(b); 38 C.F.R. § 3.102; Gilbert v. Derwinski, 1 Vet. App. 49 (1990). KRISTY L. ZADORA Acting Veterans Law Judge Board of Veterans’ Appeals ATTORNEY FOR THE BOARD T. Talamantes, Associate Counsel