Veterans Benefits issues have recently come to the forefront as a possible resource as many more of our clients are caring for aged parents and grandparents who struggle to maintain their own dignity and freedom. The most independent of these seniors are WWII veterans and surviving spouses, most 80 years or older, with a growing number of centenarians.
These once young, strong individuals, raised during the depression, faced epic financial hardships which strengthened their coping skills and honed their self-sufficient attitudes. They maintained an enduring pride which often led to the belief that benefits are charity, and accepting aid and assistance showed weakness. Eligible Wartime Periods
Why involve your CPA?
I’ve helped clients decide whether to sit on a non-profit board, step into a small business venture which proved to be a great move, and research that stock option they decided against! These clients know their CPA is a reliable source of help.
One of my clients is now facing another decision. Her mother is being released from rehab, and my client has selected a good assisted living facility. As executor of her mom’s will and co-signer on her checking account, my client knows Social Security, and the money her mom faithfully saved, won’t meet the new living expenses for long. Trying to update and sell her mom’s old home place, and with the imminent prospect of running out of money still looming, my client feels there is more she needs to do, and she asked me for help.
Veterans Benefits for mom?
My client said her father never talked about The War and, long before he passed, told her he would never take a government handout. That wasn’t an uncommon attitude for his generation.
With that in mind, we decided to explore VA options and find out if her mom (I’ll refer to her as Miss Ruth) might be eligible for Veterans Benefits as a surviving spouse based on her husband’s military service. We chose the little-known and sadly underutilized Aid and Attendance (A&A) Pension Benefit. This program provides financial benefits to WWII veterans (and other wartime veterans) and spouse or surviving spouse, who require the regular attendance of another person.
Continued independence, dignity, and quality of life are among the liberal benefits of this financial, tax-free pension. Home and attached land, vehicle ownership, other assets up to $80,000 along with Social Security benefits, coupled with these A&A financial benefits, help provide the veteran and spouse or surviving spouse a safer, more confident lifestyle, and a secure peace of mind which has already been earned.
Overview of Aid and Attendance Veterans Benefits.
Veterans and survivors, who are eligible for a pension ”…may be eligible for additional monetary payment. These benefits are paid in addition to a monthly pension, and they are not paid without eligibility to a pension…” Per this statement from the Veterans Administration, we decided to follow this possibility.
My client’s mother would need to meet at least one of the following conditions:
- Requires daily support and assistance of another individual in performing daily functions, which may include bathing, eating or dressing;
- Is bedridden;
- Is a patient in a nursing home or assisted living facility;
- Has eyesight limited to a corrected 5/200 visual acuity or less in both eyes; or concentric contraction of the visual field to 5 degrees or less.
The next step verified that Miss Ruth’s husband served in the military during designated wartime years. Combat service, service-connected injuries, or retirement from the military is not required. Instead, the veteran must have served at least 90 days, one of which must have been during an approved period of war and have received an Honorable Discharge. The benefits are, as I have mentioned earlier, tested to meet amazingly reasonable financial requirements.
The following paperwork and information as required by the VA was gathered by my client:
- Her father’s Discharge/Separation Papers (DD-214);
- Copy of her parent’s Marriage Certificate;
- Copy of Mom’s current Social Security award letter which is received early each year;
- Her mom’s asset information showing the balance of bank accounts, CDs, stocks, trusts, bonds, annuities, etc. Currently, there is no ”look back“ period. Considered assets are only those on hand at the time of application;
- Documentation of mom’s income from all sources including pensions, retirement, interest income from investments, annuities, etc.;
- Proof of insurance premiums, drugs, medical bills and any other medical expenses, including over-the-counter purchases not reimbursed by insurance, Medicare or Medicaid;
- All her mother’s doctors and hospitals visited in the last year, and;
- Banking information for direct deposit of these A&A monthly payments (along with a voided check).
The Veterans Service Officer.
Although many websites and organizations suggest mailing the above to the VA, I advise my clients to work directly with their local Veterans Service Officer. The American Legion Department Service Officers, and Veterans of Foreign Wars Service Officers and local Veterans Offices are specifically trained to provide this assistance.
We are available to help with this selection. In Fort Smith, the Sebastian County Veterans Office is located in the County Courthouse. Joe Hardin is the Service Officer and the phone number is 479-782-3421. It’s that easy. Other state Veterans Offices can be found on these links:
The Veterans Service Officer reviews these documents and many will submit everything directly to the VA and provide you with appropriate copies. Because Miss Ruth is over 90, her Aid and Attendance Veterans Benefits application will automatically be expedited; otherwise, approval can take up to nine months. The good news is, if approved, all payments are retroactive to the date of application and are payable directly into the designated checking account.
What happens next?
The VA typically sends notification within a few weeks that they are reviewing the application. When approved (as in Miss Ruth’s case), my clients usually have questions.
The most stressful issue my client faced was the decision by the VA, in conjunction with Miss Ruth’s primary physician, to determine her mother to be ”…incompetent to handle her financial affairs…“ A single-page form required Miss Ruth’s signature authorizing my client to act as fiduciary. As a potential fiduciary, my client’s accompanying signature would confirm she is willing and able to meet VA requirements to accept the responsibility. My client was distressed for a number of reasons:
- Although she is co-signer on the checking account, her mother only recently allowed her to sign checks, pay bills and shop for her;
- My client worried that her mother would not accept the findings that her doctor considered her to be incompetent and that she would object to releasing control;
- My client was also concerned about meeting VA fiduciary requirements.
These are legitimate concerns which my client and I will discuss. When an applicant for assistance disagrees with a finding, such as incompetence, the VA will vigorously protect the rights of the applicant, in this case, Miss Ruth.
I was able to immediately reassure my client that the two restrictions which currently eliminate a candidate from being appointed fiduciary–a felony conviction or a filing of bankruptcy–would not be a problem for her. All candidates, however, are interviewed by a VA Field Agent prior to final approval.
NOTE: This example, which highlights the need for a lifestyle relationship with your CPA wherein you, my client, feel comfortable and secure, is a composite of issues I’ve handled for several clients. Details have been altered. The name, Miss Ruth, was chosen as it reminds me of a favorite Bible story.
Everything we face in life can be made easier when we have someone trustworthy we know on a professional and personal level, who is skilled in specific areas of expertise. A CPA and client relationship must develop to a level of interpersonal confidence that allows discussions of emotional and sensitive issues that could affect all aspects of life. My goal is to become and remain an integral part of your life and to serve as a valuable contributor in your life choices and decisions.
Let’s get together soon. Call me, 479-478-6831 or Melanie@radcliffcpa.com
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