DGAA bLAWg

VA Benefits and the Transfer of Assets to an Irrevocable Trust

Web Admin - Friday, November 27, 2015

VA benefits and irrevocable trust, Illinois employment lawThe Department of Veterans Affairs (VA) provides our nation’s veterans with important benefits after they have been discharged from service. In order to qualify for those benefits, veterans must meet certain requirements. For some veterans, it may be necessary to transfer assets into an irrevocable trust to lower his or her net worth. 

Qualifying for Pension 

The Veterans Pension benefit is a tax-free, monetary benefit for low-income veterans. In order to qualify, the following requirements must be met: 

1. Veteran must be 65 years of age or older or permanently and totally disabled;

2. He or he must have been discharged under conditions other than dishonorable;

3. He or she must have served, which generally involves a minimum period of active duty service, one day of which was during wartime;

4. Net worth must not be considered too substantial; and

5. Countable family income must be below the yearly limit as set by law. 

Veterans who are concerned about their level of net worth may consider forming an irrevocable trust. By creating an irrevocable trust, net worth can be reduced in order to qualify for the Veterans Pension. The VA does not assess a penalty for transferring assets as long as that transfer occurs prior to filing a claim or notifying the VA of an intent to file a claim. The determination of net worth is subjective—the VA has discretion in determining whether a veteran’s assets are too large to qualify for the Veterans Pension. 

An irrevocable trust can be used to hold assets that are provided by a veteran in order to reduce net worth. Importantly, a veteran claiming benefits (as well as his or her spouse) cannot be an income or principal beneficiary of the trust established in order to obtain VA benefits. This is because the VA requires that the rights to property and income from that property be actually relinquished to be considered a reduction of net worth. 

A second issue relates to whether to form the trust as a grantor trust or a non-grantor trust. The VA compares income reported to it with Supplemental Security Income (SSI) and Internal Revenue Service (IRS) income records through a process called Income Verification Match (IVM). Due to the nature of a grantor trust, there may be a discrepancy between income reported to the VA and income that appears with IRS filings. 

Under a grantor trust, all items within the trust are taxed to the grantor on his or her personal income tax return. Ordinarily, the grantor is the person who funds the trust, which, in this case, is the veteran claiming benefits. The VA may assume that the tax reported on the veteran’s tax return is based on income of the veteran, which may lead to lower (or complete denial of) benefits. Therefore, a non-grantor trust, in which the trust is responsible for any tax, is likely more desirable, in an attempt to avoid this potential issue. 

Forming a Trust 

If you would like more information on the formation of a trust, reach out to a skilled Illinois estate planning attorney today. Our firm proudly helps individuals in the communities of Inverness, Schaumburg, Palatine, Arlington Heights, Kenilworth, Long Grove, Riverwoods, Barrington, South Barrington, and Mount Prospect. We look forward to hearing from you. 

About the Author:

Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.



Source:
http://www.benefits.va.gov/pension/








Recent Posts


Tags

life insurance policy blood alcohol content traffic violations defense Schaumburg probate attorney living wills Illinois personal injury lawyer real estate attorney Illinois construction accident attorney criminal record Arlington Heights medical malpractice lawyer Deer Park employment law attorney problem employees Illinois Wage Payment and Collection Act Chicago estate planning lawyer insurance attorney Illinois traffic accident lawyer criminal law Inverness probate lawyer Illinois Human Rights Act hands free device Deer Park accident attorney blended families Buffalo Grove medical malpractice lawyers civil rights violation income distribution deducation personal injury accidents clemency compensatory time Fair Labor Standards Act Illinois lawyer civil litigation attorney preventable medical errors criminal Rolling Meadows employment attorney federal regulations for LLCs trench injuries Inverness accident lawyer Schaumburg traffic lawyer Mt Prospect Attorney Illinois mortgages Illinois employment law firm Deer Park workers compensation lawyer traffic tickets modern family estate planning insurance claim denial attorney fees Des Plaines motorcycle accident attorney marijuana Barrington litigation attorney Self-Directed IRA Accounts elder abuse BUI Rolling Meadows drug defense attorney construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation digital media accounts, estate planning, Arlington Heights estate planning attorney, Illinois jet ski accident lawyer federal crimes Illinois employment attorneys Barrington medical malpractice lawyers Schaumburg medical malpractice lawyer Illinois law institutional trustee Palatine probate lawyer Crystal Lake criminal defense attorney brain injury marijuana crimes attorney Food and Drug Administration's Food Safety Modernization Act texting and driving insurance denials Schaumburg real estate lawyer Illinois Workers’ Compensation Commission Crystal Lake employment lawyer Illinois workplace lawyer distracted driving accidents cell phone accidents Arlington Heights car crash attorneys Buffalo Grove injury lawyer manufacturing Rolling Meadows personal injury lawyer Rolling Meadows car accident lawyers Schaumburg employment attorney Palatine civil attorney insurance denial appeals Palatine corporate law attorneys pedestrian accident car accident lawyer head on collisions denied insurance claim condo association Des Plaines accident attorney Inverness injury lawyer medical malpractice motorcycle accident liability claims investment property ken apicella Illinois red light cameras real estate lawyer ACA loss of consortium internet Illinois insurance attorney Rolling Meadows insurance dispute lawyers Forcible Entry work unions insurance agent negligence caregiver Arlington Heights accident attorney FSLA rest breaks breach of contract personal injury claim Schaumburg personal injury lawyers Arlington Heights injury attorney Joliet general practice lawyers digital evidence Illinois pet lawyer Arlington Heights wills and trusts lawyers Illinois real estate IRS Des Plaines personal injury lawyers paid sick leave car accident new real estate form Arlington Heights personal injury attorney traffic laws wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace Palatine trusts lawyer South Barrington real estate attorney Barrington Traffic Lawyer Palatine construction attorney Rolling Meadows Illinois LLC creation Riverwoods estate planning lawyer Buffalo Grove criminal defense lawyer Illinois wrongful termination lawyer digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers job lawyers social media after death Illinois traffic attorneys Rolling Meadows Attorney Chicago employment lawyer insurance dispute Schaumburg criminal attorney sexual images Illinois home inspection Illinois medical malpractice case special needs trust Schaumburg elder law lawyer Rolling Meadows marijuana attorney pain and suffering revenge porn Illinois medical malpractice attorney Barrington real estate lawyer Class A misdemeanor medical research employee discrimination Deer Park personal injury lawyer tax attorney Palatine estate planning lawyer life insurance claims involuntary manslaughter Crystal Lake pet attorney startup company Arlington Heights car accident lawyer Chicago corporate attorney Crystal Lake medical malpractice attorneys DUI attorney Barrington estate planning lawyer probate Kenilworth estate planning attorneys Do Not Resuscitate drugs workplace sexual harassment Chicago estate planning operating agreements Arlington Heights traffic attorney residential real estate Inverness real estate lawyer boating DUI personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys Illinois estate planning attorney living trust vs will Buffalo Grove insurance claim dispute lawyers Buffalo Grove real estate attorney rumble strips Rolling Meadows real estate attorney Palatine traffic accidents criminal defense Buffalo Grove traffic lawyers Illinois job attorney rollover accidents DMV motorcycle accident lawyer insurance agents gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys landlord Illinois insurance claim dispute lawyer Schaumburg personal injury attorney Deer Park motorcycle accident lawyer fatal car accidents Detainer Actions Illinois traffic ticket lawyer Palatine business attorney Arlington Heights employment attorney Illinois pedestrian accident attorney bike accident personal injury Arlington Heights wills and trusts attorney bicycle dooring accidents icy parking lots healthcare Des Plaines claims law firm Illinois personal injury attorney dram shop law Crystal Lake pedestrian accident lawyer overtime pay Inverness DUI lawyer Jay Andrew wills Rolling Meadows accident lawyer Palatine Attorney Inverness elder law lawyer Palatine employment lawyer distracted driving accident victims BAC Illinois employment law Colin H. Gilbert Illinois speeding lawyer living trust Mount Prospect wills and trusts lawyers personal injury lawyer insurance claim swimming pools Crystal Lake personal injury attorney Illinois Sales Representative Act guardianship attorney Illinois personal injury estate planning Palatine elder law attorney rollover car crashes child safety Schaumburg car accident attorney Palatine real estate lawyer foreclosed rental property Rolling Meadows corporate lawyer capital gains tax power of attorney for healthcare Illinois medical malpractice claim wage theft sexual harassment traumatic brain injuries consent to a search Arlington Heights personal injury lawyer owner responsibility cell phone tower data Illinois will lawyer Illinois small business Chicago insurance claim attorneys estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers Illinois collections attorney Illinois bicycle safety Barrington criminal lawyer workers compensation benefits Affordable Care Act workers comp Illinois insurance claims lawyers Illinois tax attorney Barrington employment law attorney Illinois rollover accident lawyers Crystal Lake bike accident lawyer Rolling Meadows insurance attorney Rolling Meadows employment law attorneys slip and fall accidents boating accidents Crystal Lake car accident lawyer Schaumburg corporate attorney Schaumburg insurance lawyers Arlington Heights TBI attorney Illinois Smoke Detector Act Des Plaines real estate attorney Legal Info Illinois workplace discrimination attorney preventing accidents bad faith insurance claims Schaumburg estate planning lawyer Des Plaines civil attorney Schaumburg creditors Deer Park DUI lawyer probate process Rolling Meadows criminal lawyer drunk driving statistics Crystal Lake traffic lawyer Des Plaines real estate lawyer Illinois wills and trusts attorneys Exclusions Deer Park medical malpractice attorney life insurance Federal Food Drug and Cosmetic Act Rolling Meadows DUI lawyer Chicago traffic lawyer Illinois traffic laws Rolling Meadows estate planning attorney Barrington personal injury attorney Crystal Lake business law attorneys life insurance lawyer spinal cord injury denial of life insurance Illinois insurance dispute lawyers Illinois motorcycle accident lawyer privacy employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, taxes deed transfer trucking accidents Schaumburg injury lawyer Rolling Meadows traffic attorney texting while driving Illinois probate lawyer Buffalo Grove probate lawyer drug possession cell phone Buffalo Grove corporate attorney Arlington Heights employment law attorneys Des Plaines collections attorney nursing home negligence Barrington injury attorney Barrington employment law firm drug crimes underinsured motorist surgical mistakes Illinois corporate lawyer liens employment contract Barrington employment attorney anesthesia errors traffic accidents slip and fall Palatine workers compensation lawyer unfunded trust Arlington Heights Attorney Rolling Meadows personal injury lawyers pregnant women Illinois driving without license severance agreements uninsured motorist BAIID expungement auto accidents Illinois civil litigation lawyer Des Plaines medical malpractice attorney probate lawyer real estate zoning GM ignition switches elder law Des Plaines tax law firm college kids Crystal Lake car accident attorney Crystal Lake employment attorney advance healthcare directive Illinois trucking safety denied insurance claims Illinois Probate Act of 1975 Super Mario jet ski liability Illinois employment lawyer drunk driving Long Grove wills and trusts attorneys accidental death benefits probate claims Illinois insurance claim dispute lawyers probate fees Des Plaines pet law attorney automated cars CAM Illinois employment laws School Visitation Rights Act insurance claim dispute Illinois traffic attorney Palatine criminal defense lawyer commercial leases low-ball insurance settlement sole proprietorship condo Illinois defective products attorney Crystal Lake accident attorney drug crimes lawyer Rolling Meadows traffic law firm DUI drug crime Rolling Meadows probate lawyer Schaumburg drug defense lawyer Transfer on Death Instrument Long Grove real estate lawyer Illinois IRA benefits Crystal Lake civil litigation lawyer unpaid assessment FMLA controlled substance Palatine corporate attorney Illinois criminal defense attorney Crystal Lake employment law attorney insurance disputes employment lawyer Mount Prospect real estate lawyer insurance negligence health insurance dispute PTSD employment attorney Buffalo Grove personal injury lawyer traumatic brain injury caretaker rights power of attorney Palatine personal injury lawyer rent to own real estate contracts murder defense Illinois business lawyer estate planning trusts independent contractor products liability Crystal Lake tax lawyer Arlington Heights criminal lawyer underfunded trust Arlington Heights Traffic Lawyer Barrington workers compensation attorney Home Remodeling Repair Act digital information Crystal Lake will lawyer home inspection lawyer Rolling Meadows boating crash lawyer Chicago will attorney, social media platforms, Illinois estate planning lawyer, Illinois business law atorneys Palatine insurance lawyer Des Plaines DUI attorney Chicago biking tips Illinois personal injury lawyers Des Plaines injury law firm Arlington Heights real estate lawyer Crystal Lake traffic attorney Rolling Meadows criminal attorney Des Plaines Traffic Lawyer Crystal Lake injury attorney insurance dispute attorney Schaumburg wrongful death attorney Chicago will attorney Schaumburg estate attorney Buffalo Grove law firm Illinois workers compensation attorney Crystal Lake law firm employment law IRELA car crash traffic offenses insurance claim delay insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys estate planning lawyer defective products insurance claim denials Retaliatory Discharge Illinois wills and trusts pet bites vacation home Illinois Transfer on Death Instrument license golf accidents defective products lawyer Illinois attorney unpaid overtime license reinstatement Inverness insurance attorney DUI penalities breathalyzer test Kenilworth estate planning attorney right to work medication errors Inverness traffic law firm real estate closing fault based insurance insurance claims pedestrian injuries, pedestrian fatality Buffalo Grove car accident lawyer irrevocable trust Arlington Heights wills and trusts attorneys car accident lawyers homestead rights estate attorney hit and run accident Long Grove estate planning attorney Schaumburg civil litigation attorney Landlord Tenant Ordinance Chicago attorney Chicago lawyer suspended license truck collisions Chicago insurance law firm Arlington Heights pedestrian accidents business litigation Schaumburg construction accident lawyer Barrington attorney crossover accidents Schaumburg criminal law attorney corporate law personal injury claims first degree murder Barrington business law firm Arlington Heights insurance attorney Schaumburg personal injury lawyer dog bites healthcare claims Illinois insurance lawyer eluding a police officer landlord tenant law murder Rolling Meadows tax attorney filing a medical malpractice claim hiring employees Schaumburg estate planning attorney food poisoning Crystal Lake medical malpractice lawyer dynasty trusts driving pizza emoji spinal cord injuries Illinois living will natural gas explosion Illinois DUI attorney DGAA workers compensation construction accidents Arlington Heights estate planning attorney natural gas Rolling Meadows employment law attorney llinois Real Estate Lawyers Association Illinois insurance disputes boating under the influence Crystal Lake insurance lawyer loopholes Mount Prospect elder law attorney license suspension comp time small business Schaumburg Attorney Barrington estate planning attorney TBI South Barrington real estate lawyer wrongful death Illinois registered agent Illinois employment law attorneys estate plan estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, employees Barrington boating accident attorney car crashes Inverness real estate attorney real estate contract Barrington criminal defense lawyer Des Plaines personal injury lawyer field sobriety test Inverness personal injury attorney in terrorem provision Illinois estate planning gift taxes Palatine injury attorney bicycle accidents meal breaks fiduciary rule delay privacy laws Barrington personal injury lawyer Inverness civil lawyer trustee unauthorized overtime Thanksgiving civil litigation Palatine punch death Long Grove real estate attorney minimum wage real estate Des Plaines insurance attorney Buffalo Grove employment lawyer estate planning for college students employee misclassification Arlington Heights lawyer traffic deaths product liability Buffalo Grove traffic attorney Policy Cancellation Crystal Lake personal injury lawyer overtime violations Fourth of July Chicago trucking accident attorney Rolling Meadows business lawyer Rolling Meadows insurance dispute lawyers, insurance dispute employment law, Illinois employment laws car collision speeding Illinois real estate lawyer underage DUI Deer Park criminal attorney Crystal Lake estate planning lawyer insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys medical marijuana insurance claim dispute attorney Illinois insurance claim attorney Employment Discrimination Law Schaumburg employment law attorneys Crystal Lake medical malpractice law firm whistleblower protections real estate leasing Home Sale Contingencies mortgage Barrington Illinois estate planning lawyer Arlington Heights trucking lawyer Rolling Meadows medical malpractice lawyers living trust benefits real estate attorneys estate tax trust payments POA commercial real estate Chicago car accident lawyer Des Plaines drug lawyer LLCs Arlington Heights tax lawyer Illinois injury lawyer forming a corporation in Illinois Attorney Ken Apicella Inverness estate planning lawyer traffic crimes Rolling Meadows litigation lawyer Rolling Meadows personal injury attorney pedestrian accidents license revocation Family Medical Leave Act Rolling Meadows Traffic Lawyer holiday statistics Palatine law firm Palatine employment attorney pet law no contest clauses Barrington drug crime attorney employee rights Illinois elder law attorney installment contracts commercial leasing Illinois workers compensation lawyer disability benefits probate claims process Deer Park traffic accident attorney Illinois estate planning law firm Long Grove estate planning attorneys Des Plaines personal injury attorney Des Plaines Colin Gilbert ObamaCare employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys Deer Park traffic lawyer medical malpractice compensation Palatine employment law lawyer Long Grove estate planning appealing an insurance claim Palatine traffic lawyer Arlington Heights wills and trusts lawyer fiduciary rule jet ski accidents Deer Park real estate law firm Buffalo Grove personal injury attorney IRA trust transfer premises liability traffic violations Des Plaines criminal attorney insurance adjusters senior citizens Illinois employee rights attorney. trauma after an accident pedestrian-automobile accident dealing with problem employees estate planning attorney Des Plaines drug crimes lawyer financial advisors foreclosure agent medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers Rolling Meadows insurance lawyer Illinois car accident attorney deadly crashes Illinois medical malpractice lawyers Kenilworth estate planning lawyer reckless homicide trucking accident lawyers changes to mortgage law Barrington civil litigation attorney car crash injuries murder charges DUI defense mass shooting Palatine drug lawyer Illinois trusts attorney Chicago employment attorney digital assets Illinois boating accident lawyer vacation home fines wills and trusts back injuries Liquor Control Act trusts personal injury law firm Illinois employment law attorney DNR Palatine civil litigation lawyer car accidents personal injury attorney medical malpractice claims Crystal lake insurance dispute attorney Inverness corporate attorney wrongful termination Whistleblower Claims

Archive