Aid and attendance is a benefit provided to Veterans who served in active duty during war time. The benefit provides cash for use by the veteran to pay for at home care or an assisted living facility. To qualify for aide and attendance, the veteran’s, or veteran’s widow’s, income and assets must be below standards set by Veterans Affairs. A useful strategy currently employed to enable veterans to meet the asset limit of aid and attendance is gifting. Using this approach, the veteran gifts their assets outright or to a trust, and then applies for Aide and Attendance.
This approach is successful because there is no penalty for transfers under Aide and Attendance. Unlike Medicaid which imposes penalties for a transfer, there is currently no penalty for transferring assets before making an application for Veterans benefits. There is currently a bill proposed in Congress to provide for a transfer penalty for Veterans benefits, similar to that found in Medicaid. The bill would penalize transfers made within one year of application for benefits. While support for the bill has waned, many believe that it is a matter of time before a transfer penalty is applied to Veterans benefits.
If you are currently residing in an assisted living facility, were discharged from the military, served at least 90 days in the United States Military with one day during war time, consider applying for Veterans benefits before a transfer penalty is enacted.