Citation Nr: 21012130 Decision Date: 03/03/21 Archive Date: 03/03/21 DOCKET NO. 18-15 406 DATE: March 3, 2021 ORDER Entitlement to survivors’ pension benefits is denied. FINDINGS OF FACT 1. The Veteran met the minimum active duty requirements in order to qualify for survivor benefits. 2. The Veteran had wartime service. 3. The Veteran’s character of service met the requirements to qualify for survivor benefits. 4. For the initial annualization period of April 12, 2016 through April 30, 2017, the Appellant’s countable family income exceeded the maximum annual pension rate (MAPR) payable to a surviving spouse with one dependent. 5. For calendar year 2017, the Appellant’s countable family income exceeded the MAPR payable to a surviving spouse with one dependent. 6. The Appellant has not provided adequate information to demonstrate her income and net worth for calendar years 2018 and 2019. 7. For calendar year 2020, the Appellant’s countable family income exceeded the MAPR payable to a surviving spouse with no dependents. CONCLUSION OF LAW The criteria for entitlement to nonservice-connected death pension benefits have not been met. 38 U.S.C. § 1543; 38 C.F.R. §§ 3.23, 3.274, 3.275, 3.276. REASONS AND BASES FOR FINDING AND CONCLUSION The Veteran served on active duty in the United States Army from December 1976 to April 1977, and from December 1990 to May 1991. During his periods of service, he earned the Army Service Ribbon, Army Reserve Components Achievement Medal Second Oak Leaf Cluster, National Defense Service Medal, and Sharpshooter Marksmanship Badge (Rifle M-16). The Veteran died in April 2016. The Appellant is his surviving spouse. Entitlement to survivors’ pension benefits Survivors’ pension benefits are generally available for surviving spouses as a result of a 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. See 38 C.F.R. § 3.3(b)(4). In this case, the Veteran served on active duty in the United States Army from December 1976 to April 1977, and from December 1990 to May 1991, which includes service during the Gulf War era. He died in April 2016. The Appellant is the Veteran’s surviving spouse. See 38 U.S.C. § 101(3); 38 C.F.R. § 3.50(b). The remaining question is whether the Appellant’s income exceeds the MAPR. The MAPR is published in Appendix BVA 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, 3.24. The MAPR is revised every December 1st and is applicable for the following 12-month period. 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 Social Security Administration (SSA) is not specifically excluded under 38 C.F.R. § 3.272. Such income is therefore included as countable income. VA regulations state that income of a child in the custody of the surviving spouse will be included if it is reasonably available to or for the surviving spouse. A hardship exclusion of a child’s income may be granted if the family’s expenses necessary for reasonable family maintenance are higher than the countable annual income, including VA pension entitlement. When hardship is established, there shall be excluded from the available income of any child an amount equal to the amount by which annual expenses necessary for reasonable family maintenance exceed the sum of countable annual income plus VA pension entitlement, computed without consideration of this exclusion. The amount of this exclusion shall not exceed the available income of any child or children, and annual expenses necessary for reasonable family maintenance shall not include any expenses which were considered in determining the available income of the child or the countable income of the surviving spouse. 38 C.F.R. §§ 3.23(d)(6), 3.272(m). 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.” 38 C.F.R. § 3.272 (g)(1)(iii). In order to be excluded from income, these medical expenses must be paid during the time period at issue, regardless of when they were incurred. In addition, they must be out-of-pocket expenses, for which the surviving spouse received no reimbursement, such as through an insurance company. However, the medical insurance premiums themselves, as well as the Medicare deduction, may be applied to reduce countable income. For the purpose of determining initial entitlement or resuming payments on an award that was previously discontinued, the monthly rate of pension shall be computed by reducing the applicable maximum pension rate by the countable income on the effective date of entitlement and dividing the remainder by twelve. 38 C.F.R. § 3.273(a). In essence, 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). Expenses of last illnesses, burials and just debts, incurred by a surviving spouse, which are paid during the calendar year following that in which death occurred may be deducted from annual income for the 12-month 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. Otherwise, such expenses are deductible for the 12-month annualization period in which they were paid. 38 C.F.R. § 3.272(h). As an initial matter, the Board notes that the Appellant claimed benefits for two dependent children, G. M. G. and T. R. G., who were over the age of 18 but under the age of 23 and enrolled in school in her January 2016 application. Notably, a “child” for purposes of additional compensation for a dependent is defined as an unmarried person who is a legitimate child, a child legally adopted before the age of 18 years, a stepchild who acquired that status before the age of 18 years and who is a member of the Veteran’s household or was a member of the Veteran’s household at the time of the Veteran’s death, or an illegitimate child, and who is under the age of 18 years, or who, before reaching the age of 18 years, became permanently incapable of self-support, or who, after reaching the age of 18 years and until completion of education or training (but not after reaching the age of 23 years) is pursuing a course of instruction at an approved educational institution. 38 U.S.C. § 101(4)(A) (2012); 38 C.F.R. § 3.57(a)(1) (2020). Although a birth certificate is not of record, the evidence of record shows that the Appellant’s child, G. M. G., was born on November 1, 1996; thus, she was 19 at the time of claim. However, the Appellant contends that G. M. G. should qualify as a dependent, as she was attending school. However, the evidence of record does not support such a finding. Specifically, a VA Form 21-674b (School Attendance Report) associated with the claims file in March 2017 shows that G. M. G. anticipated enrollment in Belhaven University in August 2017. There is no evidence of record to support a finding that G. M. G. was enrolled in college at the time of the January 2016 claim. Accordingly, G. M. G. is unable to be counted as a dependent for VA purposes. Concerning T. R. G, the evidence of record shows that she was born on October [REDACTED], 1998; thus, she did not attain the age of 18 until October [REDACTED], 2016. Accordingly, T. R. G. qualifies as a dependent for the period on appeal prior to October [REDACTED], 2106. From October [REDACTED], 2016, the Appellant contends that T. R. G. continued to qualify as a dependent, as she was a student in a full-time course of study. Here, a VA Form 21-674 (Request for Approval of School Attendance) associated with the claims file in March 2017 shows that T. R. G. was enrolled in Pearl High School at the time of the January 2016 claim. A VA Form 21-674 associated with the claims file in April 2020 seems to indicate that T. R. G. graduated from Pearl High School in May 2017. Another VA Form 21-674 associated with the claims file in April 2020 states that T. R. G. was enrolled in Belhaven University in August 2017 through May 2018. However, the Board notes that the evidence of record shows T. R. G. was next enrolled in Holmes Community College in August 2019. The April 2020 VA Form 21-674 indicates that she was not enrolled in college in a full time course of study prior to August 2019 nor was she attending school at the end of the last term. Moreover, the form notes that T. R. G. was married in June 2019. Thus, based on the evidence of record and affording the Appellant the full benefit of the doubt, T. R. G. qualifies as a dependent child for the period on appeal through May 2018, her last reported period of full-time school enrollment. Turning to the evidence of record, the MAPR for a surviving spouse with one dependent child was $11,296.00, effective December 1, 2014. No change in the MAPR was made effective December 1, 2015. Effective December 1, 2016, the MAPR for a surviving spouse with one dependent child was $11,330.00. In her May 2016 application, the Appellant reported receiving no income. She reported $1,144.70 per month (or $13,736.40 annually) income from SSA for dependent T. R. G. As to net worth, the Appellant reported that she has $200.00 in cash or in a non-interest bearing bank account. She also reported $110,000.00 in real property and two vehicles valued at $11,000.00 and $20,000.00, respectively. A February 2017 SSA Inquiry shows that monthly benefits were paid at a rate of $1,144.00 per month to T. R. G., which totaled $13,728 annually. Unreimbursed last expenses include $2,620.00 paid for the Veteran’s cremation in April 2016. See Funeral Bill/Expenses. In February 2017, the Agency of Original Jurisdiction (AOJ) requested additional information from the Appellant regarding her net worth. Specifically, the AOJ requested a completed page 9 of VA Form 21-534EZ (Application for DIC, Death Pension, and/or Accrued Benefits) and VA Form 21-8049 (Request for Details of Expenses) detailing her monthly expenses for the period of April 12, 2016 through April 30, 2017. In a March 2017 VA Form 21-8049 (Request for Details of Expenses), the Appellant listed the following monthly expenses: $780.00 for housing; $380.00 for food; $848.00 for utilities; $303.00 for car expenses; $580.00 for unnamed loans; $80.00 for credit cards; and $167.00 for car insurance, totaling $3,138.00 per month (or $37,656.00 annually). She also reported outstanding medical expenses of $3,200.00 for herself and T. R. G. Lastly, the Appellant reported expenditures of $2,620.00 related to the Veteran’s burial and $198.00 for ambulance service. The Appellant also submitted the completed page 9 of VA Form 21-534EZ (Application for DIC, Death Pension, and/or Accrued Benefits). The Appellant continued to report receiving no income. She reported $1,144.70 per month (or $13,736.40 annually) income from SSA for dependent T. R. G., as well as $520.00 per month (or $6,240.00 annually) income from T. R. G.’s wages. As to net worth, the Appellant continued to report that she has $200.00 in cash or in a non-interest bearing bank account, $110,000.00 in real property, and two vehicles valued at $11,000.00 and $20,000.00, respectively. She also reported last expenses in the amount of $2,620.00 paid for the Veteran’s cremation in April 2016. An April 2017 VA Form 21-5427 (Corpus of Estate Determination) found that the Appellant’s monthly expenses exceeded her family income by $2,025.00 per month (or $24,300.00 annually). However, it was concluded that the Appellant’s reported liquid assets of $110,200.00 could be used to 4.5 years to maintain her current standard of living; thus, the AOJ determined that the Appellant’s net worth was a bar to VA pension benefits. The Appellant’s claim was subsequently denied by a May 2017 determination because of excessive net worth. In her May 2017 notice of disagreement, the Appellant reported that that she would be experiencing a change in income. She also reported the following monthly expenses: $782.00 for housing; $172.05 for car insurance; $32.08 for gas utility; $248.00 for phone utility; $167.00 for electricity; $100.72 for water utility; $200.00 for unnamed loans; $65.00 for food; and $215.00 for cable, totaling $1,981.85 per month (or $23,782.20 annually). In an accompanying VA Form 21-0519S-1 (Improved Pension Eligibility Verification Report), the Appellant reported wages from May 4, 2017 to May 12, 2017 in the amount of $149.09. An October 2017 deferred rating decision noted that the Appellant was originally denied survivors’ pension due to excess net worth; however, it was determined that she was reporting the market value of her home. Accordingly, the AOJ requested additional information from the Appellant regarding her net worth. Specifically, the AOJ requested a completed VA Form 21-0519S-1 (Improved Pension Eligibility Verification Report) and VA Form 21-8416 (Medical Expense Report) showing all income and expenses for the period of April 12, 2016 through April 30, 2017 and January 1, 2017 through December 31, 2017. The AOJ also requested that the Appellant clarify the discrepancies regarding her net worth, as well as report wages and education expenses for G. M. G. and T. R. G. In her November 2017 VA Form 21-0519S-1, the Appellant reported $1,400.00 per month income for the period from January 1, 2017 to December 31, 2017. No additional income sources were identified, and the form is largely incomplete. Accordingly, the AOJ once again requested additional information from the Appellant in a December 2017 correspondence. Specifically, the AOJ requested a completed VA Form 21-0519S-1 (Improved Pension Eligibility Verification Report) and VA Form 21-8416 (Medical Expense Report) showing all income and expenses for the period of April 12, 2016 through April 30, 2017 and January 1, 2017 through December 31, 2017. The AOJ also requested that the Appellant clarify the discrepancies regarding her net worth, as well as report wages for T. R. G. The Appellant testified at a travel Board hearing in February 2020. She reported that she had a change in financial circumstances, to include filing for bankruptcy. The undersigned informed the Appellant that additional income information was required to develop her pension claim, particularly her complete family income, to include any wages earned by her claimed dependent children; net worth; educational expenses; and unreimbursed medical expenses from 2016 through present. In April 2020 VA Forms 21-674 (Request for Approval of School Attendance) covering 2016 and 2017 for T. R. G. was associated with the record. The Appellant reported that T. R. G. received $5,415.00 in income from SSA in 2016. T. R. G. also received $1,512.00 in wages, as well as $1,600.75 in income from SSA in 2017. No additional income was identified. The Board notes that a VA Form 21-674 covering 2019 for T. R. G. was also provided; however, as previously determined herein, May 2018 was her last reported period of full-time college enrollment prior to August 2019. In June 2020 the Board remanded the Appellant’s claim of entitlement to survivors’ pension for documentation concerning the amount of equity she had in her home since 2016, to include any mortgage payment statements and balances; documents associated with her bankruptcy filing; and updated status of income, assets and expenses. In compliance with the Board remand, an October 2020 correspondence requested documentation concerning the amount of equity the Appellant had in her home since 2016, to include any mortgage payment statements and balances; documents associated with her bankruptcy filing; up-to-date income, assets, and expenses; and medical expenses paid by the Appellant. In October 2020 the Appellant provided a check stub covering the period beginning September 27, 2020 and ending October 10, 2020. At that time, the Appellant’s gross year-to-date earnings were $28,230.19. No additional income was identified. As to assets, a VA Form 21-0519S-1 (Improved Pension Eligibility Verification Report) provided at that time indicates that the Appellant had a net worth of $149,000.00 in real property, not including her home; however, the form is largely incomplete. The Appellant also submitted a mortgage statement showing an outstanding principal balance of $97,307.35 as of October 19, 2020. A copy of Chapter 13 bankruptcy documents filed in January 2020 were also associated with the claims file; however, they do not provide any information regarding assets and expenses from 2016 forward. No additional information regarding her family income and unreimbursed medical expenses for the period from 2016 through 2019 was provided. Here, the Board finds that the Appellant’s family income for the initial annualization period, running from April 12, 2016 through April 30, 2017, was $25,576.40. Specifically, in March 2017, the Appellant reported $1,144.70 per month (or $13,736.40 annually) income from SSA for dependent T. R. G., as well as $520.00 per month (or $6,240 annually) income from T. R. G.’s wages. Additionally, in November 2017, the Appellant reported $1,400.00 per month income for herself, which includes the period from January 1, 2017 to April 30, 2017. With regard to expenses associated with the Veteran’s last sickness and burial, the Appellant has reported paying $2,620.00 for the Veteran’s cremation in April 2016, as well as $198.00 for ambulance service, which is excluded from the Appellant’s countable income. The Appellant has not identified any additional unreimbursed medical expenses or other excludable income which could be used to reduce her annual income. Although she reported outstanding medical expenses of $3,200.00 for herself and T. R. G, no medical bills or other documentation has been submitted to identify the time period during which the expenses were incurred. As such, the Board is unable to consider these expenses in calculating the Appellant’s income. When the burial expenses are subtracted from the Appellant’s total income for the initial annualization period of April 12, 2016 through April 30, 2017, the Appellant’s family income was $22,758.40, which exceeds the MAPR for a surviving spouse with one dependent. For the calendar year of 2017, the Board finds that the Appellant’s family income was $28,912.59. As previously indicated, the Appellant reported $1,400.00 per month (or $16,800.00 annually) income for herself, as well as $520.00 per month (or $6,240 annually) income from T. R. G.’s wages in November 2017. T. R. G. was also reported to be in receipt of $1,144.70 per month income from SSA. The Board notes that a VA Form 21-674 (Request for Approval of School Attendance) associated with the claims file in March 2017 indicates that T. R. G.’s SSA benefits would terminate in May 2017. Lastly, in May 2017 the Appellant reported wages from May 4, 2017 to May 12, 2017 in the amount of $149.09. She did not report any unreimbursed medical expenses or other excludable income which could be used to reduce her annual income for this period on appeal. As such, she exceeded the MAPR during this period. The Appellant has not provided any relevant information as to her family income, assets, or unreimbursed medical expenses for calendar years 2018 and 2019. The MAPR for a surviving spouse with no dependents was $9,224.00, effective December 1, 2019. Based on the provided evidence, the Board finds that the Appellant’s family income exceeded the MAPR for calendar year of 2020. In so finding, the Board notes that a check stub associated with the claim’s file in October 2002 shows gross year-to-date earnings $28,230.19. The Appellant has not reported any unreimbursed medical expenses or other excludable income which could be used to reduce her annual income. Accordingly, the facts in this case establish the Appellant’s countable annual income has exceeded the MAPR for a surviving spouse with one dependent for the initial annualization period of April 12, 2016 through April 30, 2017 and calendar years 2017. The Appellant has not provided any information for calendar years 2018 and 2019. Without satisfactory evidence of her income, net worth and unreimbursed medical expenses, it is not possible to determine the Appellant’s pension entitlement for 2018 and 2019. Moreover, her countable annual income has exceeded the MAPR for a surviving spouse without dependents in 2020. CONTINUED ON NEXT PAGE   The severity of the Appellant’s financial status has been considered; however, there is no interpretation of the facts of this case which will support a legal basis for a favorable action with regard to the Appellant’s claim. As such, the claim of entitlement to survivors’ pension benefits must be denied as a matter of law. See Sabonis v. Brown, 6 Vet. App. 426, 430 (1994). T. MAINELLI Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board T. Joseph, Associate Counsel 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.