With Veterans Day upon us, it is a perfect time to not only thank those who served our country, but remind them of the special benefits available to them as they plan their estates.

The U.S. Department of Veterans Affairs offers a myriad of programs to veterans and their beneficiaries. Unfortunately, many veterans miss out on those benefits because they’re unaware or they’re confused on how to apply and position themselves for eligibility. Eligibility rules are different for each benefit and can be complex. VA.gov contains helpful information, but consulting trained, VA-certified professionals can be much easier than trying to utilize a federal website for help. There is also danger in some of the self-professed aid websites that in actuality are marketing sites for service providers. The safest option for consumers is using the VA itself, local veterans service organizations (“VSOs”) and professionals who have taken and maintained VA certification to provide advice on options and assist with applications.

Some of the benefits veterans should review eligibility to receive include:

Life insurance: Veterans have group life insurance plans available to them as either their main plans or to supplement existing plans. The VA also offers other types of insurance with group rates.

Burial Expenses: Many veterans and their family members are eligible for burial benefits -- up to $2,000 for burial expenses of service-related deaths and $300 for non-service-related deaths. This includes burial in a VA National Cemetery, if desired.

Health care and geriatric care: The VA offers a variety of health care and aging-related services for veterans, spouses and their caregivers. There are specific programs for specific injuries, such as blindness, brain injuries or alcohol and drug dependency, as well as respite for caregivers and pain management. The VA site has specific sections for health care and geriatrics.

Aid and Attendance Benefits: These benefits can play a critical role in a veteran’s long-term care, providing a monthly allowance to help veterans and surviving spouses age 65 and older pay for assisted daily living services at home or in a facility. To qualify, the veteran’s net worth must generally be below $138,489 in 2022. Most homes will be excluded from this calculation, but, if the veteran sells a home while receiving benefits, the cash from the sale will count toward net worth, making it important to consider placing that home in a protective trust.

Veterans Asset Protection Trust

This brings up a key point for consideration: A veteran’s net worth and assets determine eligibility for benefits. A VA-accredited attorney can help a veteran create and reduce net worth. A trust known as a Veterans Asset Protection Trust (“VAPT”) can hold the veteran’s assets (including their residence) and reduces net worth so they qualify for benefits. The veteran retains tax exemptions and the ability to reside in the home, but names an independent trustee and lifetime beneficiary, often an adult child, to manage the assets and receive any income produced by the trust.

The VA imposes penalties on transfers made to qualify for cash assistance. This means that any trust should be created at least three years before applying for aid. Under the lookback regulations, veterans applying for aid must disclose all financial transactions over the past three years. If the veteran transferred assets under market value to qualify for aid, such as gifting their residence to a trust, they may be ruled ineligible to receive VA benefits up to a maximum of five years.

If this sounds confusing, it definitely can be. The rules around VAPTs are complex. Be sure to consult a VA-certified adviser and keep in mind that these rules are in addition to Medicaid qualification rules. (For example, the Medicaid lookback for nursing home level care is five years, but there is no limit to the penalty period that can be imposed for gifts made during the lookback period.) They are not the same, which makes it that much more important to use a qualified and VA-approved professional who understands your options.

Note that it is illegal to charge to assist with a VA benefits application. Charging to advise on estate planning or financial planning is allowed, but not for preparation of the VA application.