Citation Nr: 0006473 Decision Date: 03/10/00 Archive Date: 03/17/00 DOCKET NO. 92-24 076 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Cleveland, Ohio THE ISSUE Entitlement to waiver of recovery of an overpayment of Department of Veterans Affairs (VA) Section 306 death pension benefits in the amount of $3,434, to include the issue of whether the overpayment was properly created. ATTORNEY FOR THE BOARD R. A. Caffery, Counsel INTRODUCTION The veteran served on active duty from March to October 1942. He died in March 1974. The appellant has been recognized as his surviving spouse. In May 1992 the VA Regional Office (RO) Cleveland, Ohio, Committee on Waivers and Compromises denied entitlement to waiver of recovery of an overpayment of Section 306 death pension benefits, in the amount of $3,434. The appellant appealed from that decision maintaining, in part, that the overpayment had not been properly created and she did not owe the amount of the overpayment. The case was before the Board of Veterans' Appeals (Board) in November 1994 and September 1995 when it was remanded for further action. A supplemental statement of the case was issued to the appellant in April 1996. The case is again before the Board for further appellate consideration. The Board noted in the November 1994 remand that it appeared the appellant might be claiming entitlement to special monthly pension benefits and that matter was referred to the regional office for appropriate clarification/action. In January 1996 the regional office wrote to the appellant and asked her whether she had withdrawn her claim for special monthly pension benefits. Later in January 1996 the appellant advised the regional office that she had withdrawn her claim for special monthly pension benefits and did not wish to have that issue considered as part of her appeal. Thus, that matter is no longer in an appellate status. 38 C.F.R. § 20.204. FINDINGS OF FACT 1. All relevant evidence necessary for an equitable disposition of the appellant's appeal has been obtained by the regional office. 2. The appellant had been in receipt of the protected rate of Section 306 death pension benefits of $101 per month as surviving spouse of the veteran for several years based on her report that her only income consisted of Social Security benefits. 3. In December 1989 the appellant reported that her only income was Social Security benefits of $440.80 per month and that she had unreimbursed medical expenses for 1989 totaling $1,490. 4. In October 1991 the regional office determined that the appellant had $3,055 in interest income during 1989. 5. In November 1991 the regional office terminated the appellant's award of Section 306 death pension effective January 1, 1989, due to excessive net worth. This action resulted in the overpayment in question. She was later informed that her income for 1989 was also excessive. 6. The evidence does not establish that the appellant's 1989 net worth was excessive or that her countable income for 1989 was in excess of $7,697. CONCLUSION OF LAW The net worth of the appellant for 1989 did not constitute a bar to Section 306 death pension. Her countable income for 1989 did not exceed the statutory limit for continued entitlement to Section 306 death pension. Accordingly, her death pension was not properly terminated effective in January 1989 and the overpayment was not properly created. 38 U.S.C.A. § 543 as constituted on December 31, 1978; 38 U.S.C.A.§ 5107 (West 1991); 38 C.F.R. §§ 3.26, 3.260, 3.262, 3.263(1999). REASONS AND BASES FOR FINDINGS AND CONCLUSION The record reflects that the appellant had been in receipt of the protected rate of Section 306 death pension of $101 per month as surviving spouse of the veteran for several years. Her awards had been based on her reports that her only income consisted of Social Security benefits. In late 1991 the regional office advised the appellant that they were aware that in 1989 she had received $3,050 in interest. The regional office calculated that the appellant had a net worth of $61,000 (based on their assumption that she was receiving 5% interest). Accordingly, the regional office determined that the appellant's net worth was bar to receipt of Section 306 death pension and her benefits were terminated effective in January 1989. This action resulted in her being charged with the overpayment in question. It was also held that her countable income for 1989 exceeded the limit for continued entitlement to Section 306 death pension. The appellant later requested a waiver of recovery of the overpayment and also maintained that the overpayment had not been properly created and that she did not owe the amount of the overpayment. In May 1992 the regional office Committee on Waivers and Compromises denied her request for waiver of recovery of the indebtedness and this appeal ensued. The law provides for consideration of the corpus of the estate of a claimant in determining entitlement to pension. Payment of pension is not permitted where the claimant's estate is such that under all the circumstances, including consideration of his or her income, it is reasonable that some part of the corpus be consumed for the claimant's maintenance. 38 U.S.C.A. § 543, as constituted on December 31, 1978; 38 C.F.R. § 3.263. The rate of Section 306 death pension to which a surviving spouse with no dependents was entitled on December 31, 1978, could be continued if her countable income for 1989 was $7,697 or less. 38 C.F.R. § 3.26. In determining annual income for purposes of Section 306 death pension, payments of any kind or from any source are counted as income unless specifically excluded. Income is counted for the calendar year in which it is received. Income is determined by the total amount received or anticipated during the calendar year. 38 C.F.R. §§ 3.252, 3.260. In determining income for Section 306 death pension, 10 percent of Social Security and other retirement payments received by a surviving spouse is excluded. The remaining 90 percent is counted income as received. 38 C.F.R. § 3.262(e)(f). For purposes of Section 306 death pension, there will be excluded unreimbursed amounts paid by the surviving spouse for unusual medical expenses. Unreimbursed amounts which exceed 5 percent of the surviving spouse's reported annual income are considered unusual. 38 C.F.R. § 3.262. In this case, although the regional office calculated that the appellant had a net worth of $61,0000 based on the receipt of interest of some $3050 in 1989, the record does not reflect that the appellant has ever confirmed that amount of net worth for 1989. The claims file is devoid of any evidence as to the nature or amount of any assets for the appellant, even though such confirmation was specifically sought in past Board remands. The VA has to document that the appellant has such assets; it is not her responsibility to prove that she does not have such assets. On her January 1992 financial status report she listed only $500 cash on hand in addition to the home in which she resided. In short, the current record is insufficient to establish that the net worth of the appellant was a bar to the receipt of Section 306 death pension in 1989. Accordingly, her award should not have been terminated based on excessive net worth. On the appellant's eligibility verification report dated in December 1989, she reported that her Social Security benefits were $440.80 per month or $5,289.60 per year. After deduction of 10 percent, the net amount of her Social Security benefits for VA purposes was $4,760 per year. When the reported interest of $3,055 is added, the result is $7,815 for 1989. However, the appellant also indicated on her December 1989 eligibility verification report that she had had unreimbursed medical expenses of $1,490 during that year. The deductible portion of the unreimbursed medical expenses is $1,083 (5 percent of $8,344 or $417 subtracted from $1,490). When the deductible portion of the unreimbursed medical expenses is subtracted from the appellant's income of $7,815, the result is $6,732, which is well below the maximum of $7,697 for continued entitlement to Section 306 death pension for a surviving spouse with no dependents that was effective for 1989. Thus, based on the evidence of record, it is apparent that the appellant's net countable income for VA purposes did not exceed the statutory limit for continued entitlement to Section 306 death pension benefits for 1989 and her award of Section 306 death pension should not have been terminated effective in January of that year due to excess income. 38 C.F.R. §§ 3.26, 3.260, 3.262. Since the overpayment of Section 306 death pension benefits was not properly created, the issue of waiver of the overpayment is moot. In arriving at its decision in this case the Board has resolved all doubt in favor of the appellant. 38 U.S.C.A. § 5107. ORDER The appellant's Section 306 death pension was not properly terminated effective in January 1989 due to excessive net worth or income. The overpayment of Section 306 death pension was therefore not properly created. The appeal is granted. ROBERT D. PHILIPP Member, Board of Veterans' Appeals