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Pension

How to Calculate Survivors Pension

Your yearly family income must be less than the amount set by Congress to qualify for the Survivors Pension benefit. If eligible, your pension benefit is the difference between your "countable" income and the annual pension limit set by Congress. VA generally pays this difference in 12 equal monthly payments.

Income and Net Worth Limitations

Countable income includes income from most sources as well as from any eligible dependents. It generally includes earnings, disability and retirement payments, interest and dividend payments from annuities, and net income from farming or a business. Some expenses, such as unreimbursed medical expenses, may reduce your countable income.

Net worth includes assets such as bank accounts, stocks, bonds, mutual funds, annuities, and any property other than your residence and a reasonable lot area. You should report all of your net worth. VA will determine whether your assets are of a sufficiently large amount that you could live off of them for a reasonable period of time.

Hypothetical Example VA Pension Benefit Calculation

Your Survivors Pension is calculated to be an amount equal to the difference between your countable family income and the annual pension limit set by Congress.

If, for example, the annual income limit on December 1, 2005, for a spouse without a dependent, as set by Congress, is $7,094 and your income is $6,000, your VA Survivors Pension will be $1,094 ($7,094 - $6,000 = $1,094) paid in monthly installments.

  • If your total countable income is more than the $7,094 in this example, then you are not eligible for VA Survivors Pension for that year. You may reapply again at any time your countable income falls below the limit.

A portion of your unreimbursed medical expenses (what you paid out of pocket after medical insurance pays) may reduce your countable income. You can apply the portion of your unreimbursed medical expenses only if the expenses exceed 5% of the maximum annual rate allowed by Congress. Using the example above for an income of $6,000:

 If your medical expenses for a year are $8,000 and your medical insurance pays $6,400 of that, your unreimbursed medical expense is ($8,000 - $6,400) $1,600.

  • The unreimbursed medical expenses must exceed 5% of $7,094, or $354 to be deductible. Since your unreimbursed medical expenses ($1,600) in this example are greater than $354, the portion of the unreimbursed medical expenses that exceed $354, or $1,246, may be deducted from your total combined income which then increases the amount VA will pay to you.
  • The ($1,600 - $354) $1,246 out of pocket medical expenses will reduce your income from $6,000 to $4,754 ($6,000 - $1,246).
  • Your VA pension would then be $7,094 (maximum rate for a spouse with no dependents) minus $4,754 (total income after deducting unreimbursed medical expenses), or $2,340 for that year.

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