On January 23, 2015 the Department of Veterans affairs made a proposal that includes an asset limit, a look back period, and asset transfer penalties for individuals applying for VA benefits. This proposal was made in an effort to “maintain the integrity of the VA’s need based programs.” These new standards would require a 36 month look back period and a penalty period of up to 10 years. The penalty period would be calculated based on total assets transferred during the look back period to the extent they would have exceeded the net worth limit, which is to be determined. An individuals net worth includes annual income plus assets, excluding their primary residence and lot under 2 acres. However, if the residence is sold the money earned from the sale is considered part of the assets until a new residence is purchased. If approved, it will be important for veterans to keep these new regulations in mind when making financial decisions. These decisions can impact benefits received in the future as any money transferred during the ten year look back period will be factored in to the penalty period. As it is just a proposal, there are no official changes yet but we will keep an eye on its progress. The full proposal can be viewed here:http://www.va.gov/ORPM/docs/20150123_AO73P_NetWorthAssetTransfersandIncomeExclusionsforNeedsBasedB
Menu
