Decision Date: 09/27/95 Archive Date: 01/17/96 DOCKET NO. 93-12 808 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Baltimore, Maryland THE ISSUE Whether the veteran’s countable income was a bar to receipt of improved disability pension benefits effective February 1, 1988. REPRESENTATION Appellant represented by: Maryland Veterans' Service Commission ATTORNEY FOR THE BOARD Alan S. Peevy, Counsel INTRODUCTION The veteran had active military service from April 1945 to December 1945. This case is before the Board of Veterans’ Appeals (Board) on appeal from a July 1992 determination by the Baltimore, Maryland, Regional Office (RO) which found that the veteran’s countable income was excessive for purposes of continued payment of improved disability pension benefits effective February 1, 1988. A notice of disagreement was received in October 1992, and a statement of the case was issued in November 1992. The veteran’s substantive appeal was received in December 1992. This case was previously before the Board and was remanded to the RO by Board decision in October 1993. The case is now again before the Board for appellate review. The veteran is represented by the Maryland Veterans’ Service Commission. Pursuant to the Board’s October 1993 remand, the RO considered the additional issue of entitlement to special monthly pension. The RO denied entitlement to that benefit by rating decision in January 1994, and the veteran and his representative were notified of that determination and advised of appellate rights and procedures by letter dated that same month. Although the RO issued a statement of the case on the special monthly pension issue in January 1994, it does not appear from the record that a notice of disagreement was ever received to initiate an appeal. Accordingly, the issue of entitlement to special monthly pension is not in appellate status. 38 U.S.C.A. § 7105(a) (West 1991); 38 C.F.R. § 20.200 (1994). The Board also notes that an overpayment of improved disability pension benefits was created in the veteran’s account as a result of the RO’s retroactive termination of his pension benefits effective February 1, 1988. However, the Committee on Waivers and Compromises (Committee) of the RO granted a waiver of the recovery of that overpayment by decision in February 1993, and that issue is therefore not before the Board. The record also shows that an overpayment of apportioned disability pension benefits was also created in the account of the veteran’s spouse as a result of the retroactive termination of the veteran’s pension award. However, the Committee denied entitlement to a waiver of the recovery of that overpayment by decision dated in February 1994. A notice of disagreement has not been received from the veteran’s spouse, and the issue of entitlement of the veteran’s spouse to a waiver of the recovery of an overpayment of apportioned disability pension benefits is therefore not in appellate status. 38 U.S.C.A. § 7105(a) (West 1991); 38 C.F.R. § 20.200 (1994). CONTENTIONS OF APPELLANT ON APPEAL The veteran and his representative contend that the veteran did not know of his estranged spouse’s income, nor was her income available to him. It is therefore maintained that the veteran’s improved disability pension award should not have been terminated effective February 1, 1988, due to excessive income. The veteran’s representative specifically asserts that the income of an estranged spouse is not countable for pension purposes when the income of the estranged spouse is not available to the veteran. DECISION OF THE BOARD The Board, in accordance with the provisions of 38 U.S.C.A. § 7104 (West 1991), has reviewed and considered all of the evidence and material of record in the veteran's claims file. Based on its review of the relevant evidence in this matter, and for the following reasons and bases, it is the decision of the Board that the veteran’s countable income was a bar to receipt of improved disability pension benefits effective February 1, 1988. FINDINGS OF FACT 1. As of January 1988, the veteran was married, although estranged, was reasonably contributing to the support of his spouse. 2. In January 1988, the veteran’s spouse began receiving employment income which increased the veteran’s countable annual income to an amount which was in excess of the maximum annual rate of improved disability pension for a veteran with a dependent spouse. CONCLUSION OF LAW The veteran’s countable annual income was a bar to receipt of improved disability pension benefits effective February 1, 1988. 38 U.S.C.A. § 1521 (West 1991); 38 C.F.R. §§ 3.3(a)(3), 3.23, 3.271, 3.660(a)(2) (1994). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Board emphasizes at the outset that improved disability pension is paid to certain otherwise qualified veterans whose annual income in not in excess of a maximum annual pension rate which is established every year. 38 U.S.C.A. § 1521 (West 1991); 38 C.F.R. §§ 3.3(a)(3), 3.23 (1994). Under the provisions of 38 C.F.R. § 3.23(d)(4) (1994), the veteran’s annual income includes both his income and that of his dependent spouse. However, regulatory law also provides that a veteran’s spouse who resides apart from the veteran and who is estranged from the veteran may not be considered the veteran’s dependent unless the spouse receives reasonable support contributions from the veteran. 38 C.F.R. § 3.23(d)(1) (1994). In this regard, the Board stresses that, contrary to the contention advanced by the veteran’s representative, the critical question is not whether the income of the veteran’s spouse is available to the veteran, but whether the veteran is reasonably contributing to the support of his spouse. Review of the claims file reveals that the veteran was awarded Department of Veterans Affairs (VA) disability pension benefits by rating decision in 1978 as a veteran with a dependent spouse. It appears that the veteran and his spouse separated sometime in 1985, reconciled, and then separated again. In August 1985, the RO awarded the veteran’s spouse an apportionment of the veteran’s disability pension benefits in the monthly amount of $50.00. 38 C.F.R. §§ 3.450, 3.451 (1994). It appears that the apportionment was still being paid to the veteran’s spouse as of January 1988. On an Improved Pension Eligibility Verification Report (Veteran with Spouse) (VA Form 21-8916) (hereinafter referred to as an EVR) received in April 1986, the veteran checked the appropriate box to report that he was married, but not living with his spouse. He further indicated that he had contributed $150.00 toward her support during the preceding twelve months. On EVRs received in April 1987 and April 1988, the veteran checked a box to indicate that he was married and living with his spouse. On the EVR received in April 1988, he also reported that he was receiving $532.00 per month in Social Security benefits, but that his spouse had no income from any source. In the section for reporting family medical expenses for the period from March 1987 through February 1988, the veteran wrote the word “NONE.” On EVRs received in April 1989 and March 1990, the veteran also checked the appropriate box for reporting that he was married and living with his spouse. On an EVR received in March 1991, the veteran indicated that he was married, but not living with his spouse. In the spaces for reporting both his and his spouse’s social security income, the veteran merely wrote their respective social security numbers. By letter dated in late March 1991, the RO contacted the veteran’s spouse and requested her to provide information regarding any social security income as well as any income from other sources. Information was subsequently received from an employer to the effect that the veteran’s spouse began working in January 1988 and at that time she was paid $4.87 per hour. Other information received from this same employer shows that the veteran’s spouse received an annual income of over $12,000.00 in 1989 and 1990 with a projected 1991 income of over $10,000.00. As noted earlier, the veteran checked the appropriate box on EVRs received in 1987, 1988, 1989 and 1990 to report that he was married and living with his spouse. However, the record includes various detailed typed statements from the veteran and from his spouse which variously report that the parties had separated in either 1987 or 1989 (thus implicitly suggesting that the parties had at some time reconciled from the documented 1985 separation upon which the apportionment decision was based). Other statements of record from the veteran are to the effect that he was making support contributions of as much as $200.00 per month to his spouse during the separation or separations. As also noted earlier in this decision, a separated and estranged spouse of a veteran may nevertheless be considered the veteran’s dependent for purposes of including the spouse’s income if the veteran is reasonably contributing to his spouse’s support. Although the veteran has not offered any explanation for his checking the box on several pertinent EVRs to indicate that he was married and living with his spouse, the Board believes the detailed typewritten statements from both the veteran and his spouse to be more probative. The Board therefore finds that the veteran and his spouse were separated and estranged as of January 1988. Moreover, the Board finds that the veteran was reasonably contributing to the support of his spouse (a fact which the veteran himself does not dispute). Accordingly, the veteran’s spouse is deemed to be his dependent and thus her income is included for improved disability pension purposes. 38 C.F.R. § 3.23(d)(1), (d)(4) (1994). Effective December 1, 1987, the maximum annual rate of improved disability pension for a veteran with a dependent spouse was $8,140.00. VA ADJUDICATION AND PROCEDURE MANUAL M21-1, Part IV, Change 445, Appendix B. The evidence shows that the veteran was receiving $532.00 per month in social security income as of January 1988, thus resulting in an anticipated annual income of $6,384.00 over the next twelve months (the annualization period). 38 C.F.R. § 2.271(a)(1) (1994). The record further shows that the veteran’s spouse began working in January 1988 at an hourly rate of $4.87. Based on this rate of pay, the amount of her recurring income anticipated over the annualization period was easily more than the amount necessary to result in the total amount of the veteran’s countable income (comprised of both his and his spouse’s income) being higher than the maximum annual rate of improved disability pension of $8,140.00 for a veteran with a dependent spouse which was in effect in January 1988. Moreover, even if the Board were to assume for the sake of argument that the veteran was not in fact reasonably contributing to his spouse’s support as of January 1988 and that his spouse was thus not his dependent and that her income should therefore not be counted for pension purposes, the fact remains that the veteran’s own annual income of $6,384.00 from social security as of January 1988 was in excess of the maximum annual rate of $6,214.00 for a veteran with no dependents. VA ADJUDICATION AND PROCEDURE MANUAL M21-1, Part IV, Change 445, Appendix B. In sum, the evidence compels the conclusion that the veteran’s countable income was excessive as of January 1988 for payment of improved disability pension benefits. By regulation, where reduction or discontinuance of a running award of improved pension is required because of an increase in income, the reduction or discontinuance shall be made effective the end of the month in which the increase occurred. 38 C.F.R. § 3.660(a)(2) (1994). The record shows that the increase in recurring income of the veteran’s spouse occurred in January 1988 when she was first paid, and the Board therefore finds that the veteran’s income was a bar to receipt of improved disability pension benefits effective February 1, 1988. ORDER The appeal is denied. EUGENE A. O’NEILL Member, Board of Veterans' Appeals The Board of Veterans' Appeals Administrative Procedures Improvement Act, Pub. L. No. 103-271, § 6, 108 Stat. 740, ___ (1994), permits a proceeding instituted before the Board to be assigned to an individual member of the Board for a determination. This proceeding has been assigned to an individual member of the Board. (CONTINUED ON NEXT PAGE) NOTICE OF APPELLATE RIGHTS: Under 38 U.S.C.A. § 7266 (West 1991), a decision of the Board of Veterans' Appeals granting less than the complete benefit, or benefits, sought on appeal is appealable to the United States Court of Veterans Appeals within 120 days from the date of mailing of notice of the decision, provided that a Notice of Disagreement concerning an issue which was before the Board was filed with the agency of original jurisdiction on or after November 18, 1988. Veterans' Judicial Review Act, Pub. L. No. 100-687, § 402 (1988). The date which appears on the face of this decision constitutes the date of mailing and the copy of this decision which you have received is your notice of the action taken on your appeal by the Board of Veterans' Appeals. - 2 -