Today is the final day for posting comments.  There are a lot of very good ones in play, and we have no idea what the VA will do with it.  If they implement as proposed, it ​will be very hard for veterans who need pension to successfully apply.  And, there may be significant penalties for those who err in simply giving Christmas gifts to their grandchildren.  You can read more here ​and follow comments or receive email updates from the rule-making authority.​

The following is the comment we posted:

Regarding proposed rule A073:
Please consider refining changes to § 3.274 Net worth and VA pension.  As proposed, subsection (b)(1) defines net worth as “the sum of a claimant’s or beneficiary’s assets and annual income.”  In most cases, our clients spend all the funds they have for medical needs each month, and more as needed from savings or other investments.  Consequently, their annual income is never converted into spendable assets.  We would suggest that this rule does not result in a reasonable “net worth” value for determining eligibility, and propose that VA NOT count income as part of net worth.  Not counting income as an asset is similar in approach to that used by the Social Security Administration.
For similar reasons, we would suggest refining proposed rule § 3.276 Asset transfers and penalty periods.  The proposed rule in subsection (a)(5)(ii)(A) defines an annuity as “a financial instrument that provides income over a defined period of time for an initial payment of principal” and declares this to be a transfer for less than fair market value. However, this is a reasonable strategy for all people to employ … any asset when converted to a stream of income for a defined period less than or equal to the annuitant’s actuarial life accomplishes EXACTLY what the VA desires … the claimant is spending his or her assets on health care. If the annuity is irrevocable and actuarially sound, it is unreasonable for the VA to count this as a transfer for less than fair market value because it is meeting the goals of self sufficiency.  If this income is still not enough to fully fund health care costs, the claimant should be entitled to pension.  However, your proposed rule, as it is currently formulated, denies this method of self funding.  To the extent that the VA is unable to meet the demands for pension and delays cause claimants to suffer because they have spent all their funds while waiting on VA action, the rule unreasonably results in short term impoverishment and long term penalty.  Allowing the use of annuities which are sound and irrevocable would also be similar to the rules in use by the Social Security Administration.
We also work with a number of veterans and their families who provide regular charitable and family gifts to one another.  Most of our veteran clients are long-time members of churches and other organizations.  They are also grandparents.  Proposed rule 276, section (8)(c) “Presumption and exception pertaining to covered assets” establishes a presumption that in the “absence of clear and convincing evidence showing otherwise, VA presumes that an asset transfer made during the look-back period was for the purpose of decreasing net worth.”  It is not clear that a history of gifting would be sufficient to rebut the presumption.  We would propose that either this restriction is completely removed, or that examples of evidence include something like the following: “rebuttable means a history of giving to family, friends, church or other charitable organizations as defined by IRS regulations which may be demonstrated by checks or IRS tax records, or affidavits by recipients as to the nature of the gift.”  This relaxation of the rules would allow grandparents to gift to their children or succeeding generations while they are in a position to enjoy the benefits of such gifts.
Finally, many of our clients have homes that are in rural areas or were family farms.  Proposed rule § 3.275 “How VA determines the asset amount for pension net worth determinations” includes a provision that  land holdings be limited to 2 acres. Subsection (3) defines residential lot area to mean “the lot on which a residence sits that is similar in size to other residential lots in the vicinity of the residence, but not to exceed 2 acres (87,120 square feet), unless the additional acreage is not marketable.”  Technically, many of our rural counties in North Carolina​ do not allow subdivision into parcels less than a certain acreage.  In Chatham County, for example, the limit is 10 acres.  That means that a 19 acre parcel of land, with a home claimed as exempt, could be construed by a VA examiner to exceed the threshold and deny pension, even though the land could not be subdivided.  Perhaps this is also not “marketable”, but it would require that VA examiners be intimately familiar with rules for every county in the country or risk a significant increase in NOD’s for such purposes.  In addition, such a rule would be fundamentally opposed to continuing family inheritances, operation of family farms, and distribution of family wealth under long standing common law principles.  Further, the proposed rule is inconsistent with Social Security rules as well as Bankruptcy law which allows exemption of adjacent land.  We respectfully request that the limitation on acreage be removed.