I hear from many people including clients and others who assist veterans about the $80,000 asset limit for VA. Unlike Medicaid, there is no hard limit for assets with VA. According the VA, you must not have “excessive assets.” This vague term certainly leaves room for interpretation, which is precisely why the VA manual includes a test to determine if a claimant’s assets are “excessive”.The VA’s formula consists of several factors including life expectancy of the claimant, income, medical expenses and the number of countable assets you have. What the VA is truly looking for is a projection of how long your assets will last based on the drain of medical costs on them. The VA then compares the asset amount to the claimant’s life expectancy (which comes from a table of life expectancies). If the VA feels that you will run out of assets to pay for your medical care during your lifetime, then you will likely be awarded the benefit. If they feel you possess a sufficient amount of assets to cover your medical expenses, then you will not receive the benefit.The $80,000 threshold comes into play because any claimant with countable assets of more than $80,000 must pass the test using this formula. If the claimant has fewer than $80,000 in assets, the adjudicator can still decide to run the formula. While no requirement exists, many adjudicators take the time to run the formula on most, if not all, claims they see. For this reason, you should certainly consult an accredited VA attorney prior to applying for Aid & Attendance. Taking the time to work with an attorney can prevent many other issues that arise during the application process. By taking this step you will be assured to be in the best position possible to receive the benefit with the least amount of hassle, and in the shortest period of time.
Unfortunately, many people try to reduce their assets below the $80,000 threshold on their own. This is never a good idea. Gifting to qualify for VA benefits is a complicated strategy and if done without the advice of professionals, can have many negative complications. You should always discuss any large gift or asset transfer with an attorney or CPA to make sure that it does not have unintended tax and other negative consequences for you and your family in the future. While there currently is no penalty for gifting in order to receive VA benefits, there are harsh penalties assessed to gifts made in an effort to qualify for Medicaid. Do-it-yourself planning for VA may make you ineligible for Medicaid down the road. A good elder law attorney will help to highlight and address negative issues for you and put you in a position to maximize both benefits. For more information on how you can qualify for VA Benefits or if you have more questions, please contact AlerStallings, a boutique Estate Planning and Elder Law firm located in Dublin, Ohio. You can attend one of our Free events in the Columbus area, or we would love to sit down with you for a Complimentary one-hour consultation to discuss your situation.
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