Citation Nr: 21071966 Decision Date: 12/01/21 Archive Date: 12/01/21 DOCKET NO. 18-19 542 DATE: December 1, 2021 ORDER The termination of Department of Veterans Affairs (VA) pension benefits due to excessive income, effective July 1, 2009, was proper; the appeal is denied. The overpayment of VA pension benefits in the amount of $74,497.00 was properly created; the appeal is denied. FINDINGS OF FACT 1. The Veteran began receiving Social Security Administration (SSA) benefits in May 2009 at a monthly rate of $1,205.00. 2. The Veteran began receiving pension payments from the Southern California Gas Company (SoCal) in August 2013 at a monthly rate of $694.52. 3. VA did not receive notice of the Veteran's income sources until May 2015. 4. The overpayment of $74,497.00 was not solely the result of VA administrative error. CONCLUSIONS OF LAW 1. Termination of the Veteran's pension benefits effective July 1, 2009, due to change in countable income was proper. 38 U.S.C. §§ 1521, 1522; 38 C.F.R. §§ 3.23, 3.271, 3.272, 3.273. 2. The overpayment of VA pension benefits in the amount of $74,497.00 was validly created. 38 U.S.C. § 5112; 38 C.F.R. §§ 3.401, 3.501. REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran served on active duty from December 1965 to December 1967. This matter comes before the Board of Veterans' Appeals (Board) on an appeal from an August 2015 rating decision by a VA Regional Office, which is the Agency of Original Jurisdiction (AOJ). In connection with his appeal, the Veteran requested a hearing before a Veterans Law Judge. However, prior to the hearing, the Veteran withdrew his request in an October 2021 correspondence. 1. Propriety of the termination of VA pension benefits due to excessive income, effective July 1, 2009. 2. Validity of the creation of a $74,497.00 overpayment. The Veteran contends that the termination of VA pension benefits effective July 1, 2009, resulting in an overpayment of $74,497.00, was improper. In this regard, the Veteran contends he notified VA of his award and receipt of SSA benefits. He reported that he was told by SSA that his information was in a federal registry, and that he listed all his income sources in his tax filings with the Internal Revenue Service (IRS). Thus, he contends the overpayment was entirely VA's fault. However, upon review of the record, there is no evidence that the Veteran informed VA of his change in income due to the SSA award, and the record shows he was notified of his duty to report any change in income status. Therefore, the termination of VA pension benefits, and the overpayment, was proper. 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. Recipients 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. Entitlement exists if, among other things, the veteran's income is not in excess of the applicable maximum allowable pension rate (MAPR), and specified at 38 C.F.R. § 3.23, as changed periodically, and reported in the Federal Register. See 38 U.S.C. § 1521. The maximum rates for a veteran's pension are reduced dollar for dollar by the amount of the countable annual income of a veteran, his spouse, and any dependent. 38 U.S.C. § 1521; 38 C.F.R. § 3.23(d). The MAPR is revised every December 1st and is applicable for the following 12-month period. The MAPR shall be reduced by the amount of the countable annual income of the surviving spouse. 38 U.S.C. §§ 1503, 1521; 38 C.F.R. §§ 3.3, 3.23(b). 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 during the 12-month annualization period in which received, except for listed exclusions. 38 U.S.C. § 1503(a); 38 C.F.R. § 3.271(a). Income from the SSA is not specifically excluded under 38 C.F.R. § 3.272, and is therefore included as countable income. The Veteran originally applied for VA pension benefits in February 2007, indicating he received no income, had zero net worth, and had not applied for and did not receive SSA benefits. In March 2007, an SSA inquiry revealed no Title II or Title XVI data on the Veteran. Accordingly, he was granted non-service-connected pension benefits in a March 2007 rating decision. In a March 2007 notice letter to his address on record, he was informed of the grant of pension benefits as a single Veteran with no dependents and no income. He was also informed of his responsibility to notify VA immediately if his income changes, including due to SSA benefits. Then, in October 2007, VA sent a reminder letter to the Veteran, informing him again that if his income changes, he must inform VA right away. In December 2007, December 2008, December 2009, and December 2011, the Veteran was advised that he would not receive eligibility verification reports (EVRs) because people with no income other than VA pension do not have to complete an EVR. The letters advised that he would not have to complete the form unless his situation changed, and that he must tell VA if he begins receiving Social Security payments or starts getting other income. Then, in a January 2013 notification letter, the Veteran was notified that VA was discontinuing the use of EVRs due to technological improvements, including expansion of data matching agreements with the IRS and the SSA, allowing VA to verify a pension applicant's income before awarding benefits. It advises that the Veteran must still notify VA of any change in income. In November 2008, December 2011, December 2012, December 2013, and December 2014 notification letters, the Veteran was advised that his pension award had been amended to adjust for cost of living. The letters indicate that the Veteran's net countable income was $0 and that if the income information was incorrect, he should furnish an accurate statement of his income from all sources or net worth changes. In May 2015, VA received a Residential Loan Application form the Veteran, wherein he reported a pension/retirement account income from SoCal in the amount of $694.52 per month beginning August 1, 2013. He also reported receiving SSA income of $1,205 a month in 2015. The AOJ completed an SSA inquiry in May 2015, which showed the Veteran became entitled to SSA benefits in May 2009, at a monthly rate of $1,205. Subsequently, in May 2015, the AOJ contacted the Veteran to confirm his countable income. The Veteran confirmed he was receiving SSA benefits of $1,309.90 monthly, and became entitled to SSA benefits in 2009. He also confirmed he had been receiving $694.52 per month in retirement benefits from SoCal since August 2013. The AOJ notified the Veteran in this call that it would be required to terminate his pension benefits as of July 1, 2009, due to his countable income exceeding the MAPR, and requested to stop payments immediately to reduce any overpayment. The Veteran did not give permission to stop benefits. In a June 2015 letter, the AOJ notified the Veteran that they had learned his countable income has exceeded the MAPR limits, and they proposed to terminate his pension benefits as of July 1, 2009, the first day of the month after which he was likely first paid his SSA benefits. Then, in the August 2015 decision on appeal, the AOJ terminated his pension benefits effective July 1, 2009, creating the overpayment. Turning to the Veteran's countable income, he does not dispute the amounts and dates of his received income, or that it exceeded the MAPR for each year. In this regard, the record shows and the Veteran confirmed that his SSA entitlement began in May 2009, and he received monthly rates of $1,205 in 2009, then $1,204.50 from October 2010 to December 2011, $1,247.90 for 2012, 1,268.90 for 2013, $1,287.90 for 2014, and $1,309.90 for 2015. Additionally, he received the $694.52 per month from SoCal beginning August 2013. In 2009, for Veteran's pension purposes, the MAPR for a Veteran with no dependents was $11,830. See Pension Rate Tables, effective December 1, 2008, available at https://www.benefits.va.gov/PENSION/rates_veteran_pen08.asp (accessed on Nov. 16, 2021). The MAPR was increased to $12,256, effective December 1, 2011; $12,465, effective December 1, 2012, $12,652, effective December 1, 2013, and $12,868 effective December 1, 2014. VA subtracts the total amount of countable income in one year, less excluded income, from the MAPR for that year; then, if a positive amount remains, the rest is divided by twelve to determine the monthly death pension benefit. When a change in the MAPR occurs, the Board repeats the calculation with the new MAPR as the starting amount. 38 C.F.R. § 3.273(b)(1). When a change in income occurs, the MAPR will be reduced by the new annualized income effective on the date that the increased income began. 38 C.F.R. § 3.273(b)(2). The effective date of any reduction or discontinuance required because of an increase in income shall be the end of the month in which the increase occurred. See 38 C.F.R. § 3.660(a)(2). Here, converting the monthly account into a year sum, the Veteran's yearly countable income was $14,460 in 2009, $14,459 in 2010, $14,454 in 2011, $14,974.80 in 2012, $18,699.40 in 2013, $23,789.04 in 2014, and $24,053.04 in 2015. Consequently, the record is clear that his countable income exceeded the MAPR limits for each year beginning July 1, 2009 when he began receiving SSA benefits. For purposes of calculating pension benefits, total income may be reduced by amounts equal to amounts paid by a claimant for unreimbursed medical expenses that were "in excess of 5 percent of the applicable maximum annual pension rate or rates, as in effect during the 12-month annualization period in which the medical expenses were paid." See 38 U.S.C. § 1503(a)(8); 38 C.F.R. § 3.272(g)(1)(iii). However, the Veteran has not provided any information regarding unreimbursed medical expenses to offset his countable income. In this regard, the Veteran has a duty to assist and cooperate with VA in developing evidence; the duty to assist is not a one-way street. See Wood v. Derwinski, 1 Vet. App. 190, 193 (1991). Thus, the record does not support reducing his countable income based on unreimbursed medical expenses. As noted above, the Veteran does not dispute this information or the accounting. Rather, he contends that he did inform VA of his receipt of SSA income and to the changes in his income, and thus the overpayment was solely the fault of VA's administrative error, and was not valid. As a result, the Board finds the preponderance of the evidence shows that the Veteran began receiving additional income as of July 1, 2009, that exceeded the MAPR on an annualized basis through the RO's termination of the award in August 2015. The evidence does not support a finding that the Veteran's income was excludable or that he had expenses that would reduce his income below the MAPR from July 2009 to August 2015. The Board concludes that the termination of the Veteran's pension payments as of July 1, 2009, was correct. The Board turns to consider the Veteran's arguments regarding the validity of the overpayment. An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits in excess of the amount to which he or she was entitled. 38 C.F.R. § 1.962. Whenever the Secretary finds that an overpayment has been made to a veteran or eligible person, the amount of such overpayment shall constitute a liability of such veteran or eligible person to the United States. See Mountford v. Shinseki, 24 Vet. App. 443, 450, n.6 (2011) (citing 38 U.S.C. §§ 3685, 5314). To establish improper creation of an overpayment, i.e., an invalid debt, evidence must show that the Veteran was legally entitled to the VA compensation benefits at issue, or, if he was not legally entitled to these benefits, then it must be shown that VA was solely at fault for the erroneous payment of excess benefits. As shown above, the Veteran's pension benefit was properly terminated, and therefore he was not legally entitled to the compensation. Turning to the Veteran's arguments, the record does not support his contentions that he properly informed VA. Specifically, he reported initially that he "believed" he informed VA, and he was told by SSA that his information would be in the "federal record" so VA would know, and he signed a release for SSA to share information with VA. See June 2015 Document Labelled "Congressionals." In contrast however, VA contacted SSA in January 2018, wherein the SSA representative stated they do not notify other federal agencies when a person becomes eligible and receives benefits. Regardless, he received notice from VA of his responsibility to update VA after any change in income when he was first granted benefits, he was given a reminder of this responsibility months after his grant of benefits, and he was given a reminder of this need nearly every year since the grant of benefits. He also received cost-of-living adjustments nearly every year, which continued to indicate that he was considered to be a Veteran with no income. Therefore, despite the fact that he believed SSA would notify VA, or that he notified VA, he continued to receive these notification letters which clearly indicated VA did not know of any countable income. Thus, he was put on notice with each letter that VA did not know about his SSA income. Regardless of whether he believed SSA should have or did inform VA, he had actual knowledge that VA did not know of his income information and he took no action to correct this error. In regard to his argument that he listed all his income on his IRS tax filings, this also is insufficient notice to VA. VA does not pull the Veteran's tax filings without impetus to determine whether they have correctly reported all their countable income. The Veteran essentially argues that VA should have searched all federal databases to determine his countable income. However, it is the Veteran's duty to report his change in income, and VA relies on the Veteran's action. Additionally, the Veteran did not notify VA of his receipt of the SoCal retirement income until a year and half after he began receiving this income. Again, whether he believed VA should have known that he was receiving income based on his tax filings, it was his duty to inform VA of his change in income. His failure to update VA about this new source of income weighs against his credibility that he provided notice to VA regarding his SSA income. In sum, the Board finds the preponderance of the evidence shows that the Veteran received income he had not reported to VA, that VA was not aware of the additional income, that he was on notice that he bore a responsibility to inform VA of his additional evidence, and took no action to do so. Accordingly, the evidence shows that VA's overpayment to the Veteran was not the result of sole VA administrative error. Sole administrative error entails no knowledge or fault on the part of the debtor. See Jordan v. Brown, 10 Vet. App. 171 (1997). The Veteran received multiple notification letters informing him that he was receiving pension benefits and that it was his responsibility to promptly report any change in her income, including SSA benefits. As such, the Board finds that the Veteran knew or should have known that his pension award should have been adjusted based on his income. The Veteran's failure to promptly notify VA of changes in his income contributed to VA's payment of the erroneous award; thus, the creation of the overpayment was not a result of sole VA administrative error. 38 C.F.R. § 3.500(b)(2); Jordan, supra. The Board is sympathetic to the Veteran's situation and to the financial hardship he experienced as a result of the recoupment of the overpayment. However, the Board is unable to provide a legal remedy. See Owings v. Brown, 8 Vet. App. 17, 23 (1995), quoting Kelly v. Derwinski, 3 Vet. App. 171, 172 (1992) ("[T]his Court must interpret the law as it exists, and cannot 'extend... benefits out of sympathy for a particular [claimant].'"). Under the law, as the Veteran's countable income exceeded the MAPR for each year beginning July 1, 2009, since he began receiving SSA benefits, the termination of his VA pension benefits effective that date, and the creation of the overpayment, is proper. As stated above, the Board finds that the preponderance of the evidence is against restoration of the Veteran's pension payments on or after July 1, 2009, and against the Veteran's assertions that he was not at least partly at fault in the creation of the debt; therefore, the benefit-of-the-doubt rule does not apply. 38 U.S.C. § 5107(b); 38 C.F.R. § 3.102. Accordingly, the Veteran's appeal of the termination of pension benefits and the validity of the debt must be denied. J. B. FREEMAN Veterans Law Judge Board of Veterans' Appeals Attorney for the Board Jonathan M. Estes The Board's decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.