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Chapter: 1800 Income Program: MSSI, SFP 26 1840.0906 Veterans Benefits and Payments (MSSI, SFP) Veterans’ compensation and pensions are based primarily on service in the armed forces and may also be made to the veterans’ dependents or survivors. These payments, including stipend payments for participation in a study of Vietnam era veterans’ psychological problems (P.L. 99- 576) and monthly payments to veterans of the Vietnam era as a result of exposure to Agent Orange (P.L. 102-4) are counted as unearned income. The following are excluded as income:

1. Reductions in basic pay while in active duty service or selected reserve service to provide for future basic educational assistance (P.L. 99-576). 2. Payments to a natural child of a Vietnam veteran born with spina bifida, except spina bifida occulta, as a result of the exposure of one or both parents to Agent Orange (P.L. 104-204). 3. Payments to a natural child of a woman Vietnam veteran born with one or more birth defects resulting in permanent physical or mental disability (P.L. 106-419). 4. Aid and attendance, a housebound allowance and unreimbursed medical expenses for MSSI and HCDA. 1840.0906.01 Veterans Payments-Compensation (MSSI, SFP) Compensation payments are included as unearned income. Compensation benefits generally are not based on need and a $20 general exclusion is applied.

Compensations are paid to a veteran because of a service-connected disability and are paid to a widow, widower, child, or parent of a veteran because of the service-connected death of the veteran. Death compensation and dependency and indemnity compensation (DIS) do not generate the $20 general exclusion because they are based on need. These payments are made to parents and based on the parents' income.

All applicants who appear potentially eligible for compensation payments must apply. 1840.0906.02 Veterans Payments-Pensions (MSSI, SFP) VA pensions are included as unearned income, excluding the amount of aid and attendance, housebound allowance, and unreimbursed medical expenses. Except in OSS, refer to passage 1840.0906.10 for OSS information. VA pensions generally are based on need and, therefore, do not receive the $20 general exclusion.

Pensions are paid to veterans based on a combination of services and age (65 or older), or a non-service connected disability. Pensions are paid to a widow, widower, or child of a veteran because of the non-service connected death of a veteran.

Three types of pensions are not based on need and do receive the $20 general exclusion. These are pensions passed as a special act of Congress, service in the Spanish-American War (April 21, 1890 - July 3, 1902), and service in the Indian Wars (January 1, 1817 - December 31, 1898).

All applicants who appear potentially eligible for a pension must apply. 1840.0906.03 VA Dependent Allowances (MSSI, SFP) The VA provides dependent allowances to veterans claiming to support one or more dependents. The allowances included in the VA check designated for a dependent are only counted as income to the dependent.