38 CFR 3.261 – Character of income; exclusions and estates
Current as of: 2024 | Check for updates
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The following factors will be considered in determining whether a claimant meets the requirements of §§ 3.250, 3.251 and 3.252 with reference to dependency, income limitations and corpus of estate:
(a) Income.
| Income | Dependency (parents) | Dependency and indemnity compensation (parents) | Pension; old-law (veterans, surviving spouses and children) | Pension; section 306 (veterans, surviving spouses and children) | See— |
|---|---|---|---|---|---|
| (1) Total income from employment, business, investments, or rents | Included | Included | Included | Included | § 3.262(a). |
| (2) Income of spouse | ……do | ……do | Excluded | ……do | § 3.262(b). |
| (3) Earnings of members of family under legal age | ……do | Excluded | ……do | Excluded | § 3.250(b)(2). § 3.252(e)(3). |
| (4) Earned income of child-claimant | Included | ……do | |||
| (5) Gifts, including contributions from adult members of family: | |||||
| Property | ……do | Included | ……do | ……do | § 3.262(k). |
| Money | ……do | ……do | ……do | Included | |
| (6) Value of maintenance by relative, friend, or organization | Excluded | Excluded | Excluded | Excluded | § 3.262(c). |
| (7) Rental value of property owned by and resided in by claimant | ……do | ……do | ……do | ……do | |
| (8) Charitable donations | ……do | ……do | Included | ……do | § 3.262(d). |
| (9) Family allowance authorized by service personnel | Included | Included | ……do | Included | |
| (10) Reasonable value of allowances to person in service in addition to base pay | ……do | ……do | ……do | Included except as earned income of child-claimant | |
| (11) Mustering-out pay | Excluded | ……do | Excluded | ……do | |
| (12) Six-months’ death gratuity | ……do | Excluded | ……do | Excluded | |
| (13) Bonus or similar cash gratuity paid by any State based on service in Armed Forces of United States | Excluded | Excluded | Excluded | Excluded | |
| (14) Retired Serviceman’s Family Protection Plan; Survivor Benefit Plan (10 U.S.C. ch. 73): | |||||
| Retired Serviceman’s Family Protection Plan (Subch. I): | |||||
| Annuities | ……do | ……do | ……do | ……do | |
| Refund (10 U.S.C. § 1446) | Included | Included | Included | Included | |
| Survivor Benefit Plan (Subch. II) (Pub. L. 92-425; 86 Stat. 706) | ……do | ……do | ……do | ……do | § 3.262(e). |
| Annuity under § 653, Pub. L. 100-456 | Included | Included | Excluded | Excluded | § 3.262(r) |
| (15) Retirement pay received direct from service department | Included ……do | Included ……do | Included ……do | Included ……do | § 3.262(e). § 3.262(h). |
| (16) Retirement benefits; general | ……do | ……do | ……do | ……do | § 3.262(e). |
| (17) Social security benefits: | |||||
| Old age and survivors’, and disability insurance | Included | Included | Included | Included | § 3.262(f). |
| Charitable programs | Excluded | Excluded | ……do | Excluded | |
| Lump-sum death payments | Included | ……do | ……do | ……do | |
| Supplemental security income | Excluded | Excluded | ……do | ……do | |
| (18) Railroad Retirement benefits | ……do | Included | Disability pension—Excluded Death pension—Included | Included | § 3.262(g). |
| (19) Retirement pay waived under Federal statute | Excluded | Excluded | Excluded | ……do | § 3.262(h). |
| (20) Department of Veterans Affairs payments: | |||||
| Pension | Excluded | Excluded | Excluded | Excluded | |
| Compensation and dependency and indemnity compensation | ……do | ……do | ……do | ……do | |
| World War I adjusted compensation | ……do | Included | ……do | Included | |
| U.S. Government life insurance or national service life insurance for disability or death, maturity of endowment policies, and dividends, including special and termination dividends | Excluded | Excluded | Excluded | Excluded | |
| Servicemembers’ group life insurance | ……do | ……do | ……do | ……do | |
| Veterans’ group life insurance | ……do | ……do | ……do | ……do | |
| Servicemembers’ indemnity | ……do | ……do | ……do | ……do | |
| Subsistence allowance (38 U.S.C. ch. 31) | Included | Included | Included | Included | |
| Veterans educational assistance in excess of amounts expended for training (38 U.S.C. ch. 34) | ……do | ……do | ……do | ……do | |
| Educational assistance (38 U.S.C. ch. 35) | Excluded | Excluded | |||
| Special allowance under 38 U.S.C. § 1312(a) | Excluded | Included | ……do | Included | |
| Statutory burial allowance | ……do | Excluded | ……do | Excluded | |
| Accrued | ……do | Included, except accrued as reimbursement | ……do | Included, except accrued as reimbursement | |
| (21) Compensation (civilian) for injury or death | Included | Included | Included | Included | § 3.262(i). |
| (22) Contributions by a public or private employer to a: | |||||
| Public or private health or hospitalization plan for an active or retired employee | Excluded | Excluded | Excluded | Excluded | |
| Retired employee as reimbursement for premiums for supplementary medical insurance benefits under the Social Security Program (Pub. L. 91-588; 84 Stat. 1580) | Included | Included | Excluded | Excluded | |
| (23) Overtime pay; Government employees | Included | Included | Disability pension—Excluded. Death pension—Included | Included | |
| (24) Commercial life insurance; disability, accident, or health insurance, less payments of medical or hospital expenses resulting from the accident or disease for which payments are made | Included (as received) | Included (as received) | Included (special provision) | Included (as received) | § 3.262(j). |
| (25) Commercial annuities or endowments | ……do | Included (special provision) | ……do | Included (special provision) | § 3.262(j). |
| (26) Dividends from commercial insurance | Excluded | Excluded | Excluded | Excluded | |
| (27) Insurance under Merchant Marine Act of 1936, as amended | Included | Included | Included | Included | |
| (28) Reimbursement for casualty loss (Pub. L. 100-687) | Included | Excluded | Included | Included | § 3.262(t) |
| Other fire Insurance | Excluded | Excluded | Excluded | Excluded | § 3.262(t) |
| (29) Bequests, devises and inheritances: | |||||
| Property | Included | Excluded | Included | ……do | § 3.262(k). |
| Money | ……do | Included | ……do | Included | |
| Joint bank accounts | ……do | ……do | ……do | Excluded | § 3.262(k)(1). |
| (30) Profit from sale of property | Excluded | Excluded | Excluded | Excluded | § 3.262(k). |
| (31) Jury duty or obligatory civic duties | ……do | ……do | ……do | ……do | |
| (32) Relocation payments (Pub. L. 90-448; Pub. L. 90-495) | ……do | ……do | ……do | ……do | § 3.262(c). |
| (33) The following programs administered by the ACTION Agency: | |||||
| Foster Grandparent Program and Older Americans Community Service Programs payments (Pub. L. 93-29; 87 Stat. 55) | ……do | ……do | ……do | ……do | § 3.262(q)(1). |
| Volunteers in Service to America (VISTA), University Year for ACTION (UYA), Program for Local Services (PLS), ACTION Cooperative Volunteers (ACV), Foster Grandparent Program (FGP), and Older American Community Service Programs, Retired Senior Volunteer Program (RSVP), Senior Companion Program (Pub. L. 93-113; 87 Stat. 394) | ……do | ……do | ……do | ……do | § 3.262(q)(2). |
| (34) The Service Corps of Retired Executives (SCORE) and Active Corps of Executives (ACE) administered by the Small Business Administration. (Pub. L. 93-113; 87 Stat. 394) | ……do | ……do | ……do | ……do | § 3.262(q)(2). |
| (35) Income received under Section 6 of the Radiation Exposure Compensation Act (Pub. L. 101-426) | Excluded | Excluded | Included | Included | § 3.262(t) |
| (36) Income received from income tax returns | Excluded | Excluded | Excluded | Excluded | § 3.262(u) |
| (37) Other amounts excluded from income by statute | Excluded | Excluded | Excluded | Excluded | § 3.262(v) § 3.279 |
1 The compensation received through a crime victim compensation program will be excluded from income computations unless the total amount of assistance received from all federally funded programs is sufficient to fully compensate the claimant for losses suffered as a result of the crime.
(b) Deduction of amounts paid by claimant.
| Deduction | Dependency (parents) | Dependency and indemnity compensation | Pension; old-law (veterans, surviving spouses, and children) | Pension; section 306 (veterans, surviving spouses, and children) | See |
|---|---|---|---|---|---|
| (1) Unusual medical expenses | Not authorized | Authorized | Not authorized | Authorized | §§ 3.262(b)(1) and (1). |
| (2) Veteran: just debts, expenses of last illness and burial | Not authorized | Authorized, except debts | Not authorized | Authorized | §§ 3.262(m) and (o). |
| (3) Veteran’s spouse or child: expenses of last illness and burial | Not authorized | Not authorized | Not authorized | Authorized | § 3.262(n). |
| (4) Parent’s spouse: just debts; expenses of last illness and burial | Not authorized | Authorized | § 3.262(o). | ||
| (5) Prepayment on real property mortgages after death of spouse (Pub. L. 91-588) | Not authorized | Not authorized | Not authorized | Authorized | §§ 3.262(k)(6). |
(c) Corpus of estate.
| Dependency (parents) | Dependency and indemnity compensation | Pension; old-law (veterans, widows, and children) | Pension; section 306 (veterans, surviving spouses, and children) | See | |
|---|---|---|---|---|---|
| Considered conditionally | Not considered | Not considered | Considered | § 3.263. |