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Please forgive me if this is a duplicate, but I didn't see my last question come through(?). My dad is 91 and we're applying for Vet's benefits. I can't get a firm answer to my questions re whether or not the VA has implemented a look back period for transferring assets. Everything I've read on the internet indicates the VA tried to pass a law requiring a look back, but it was never fully signed. My local VA counselor insists that the VA DOES have a look back period, but he can't give me the particulars. A guy who write books about how to get VA benefits tells me that there is a 3 years look back even though congress never approved a law authorizing this AND, I just spoke to an elder law attorney who definitely tells me that there is currently NO look back period and not to worry one bit about transferring assets...ARGH! Does anyone out there know what the real scoop is and what the authority for it is? I would really appreciate some help with this - we have to make a decision re all this in the next week.

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Actually, the attorney is correct. There is currently no prohibition against transferring assets prior to application and this is clearly stated in the VA's M-21-1 MR policy manual. The transfer must be complete with no incidence or ownership or benefit to the claimant.

Even though this is the rule, it does not prevent the VA from questioning assets or income they may discover during IRS cross checks. I have had several cases lately where income from an asset was picked up from 1099's from several previous tax years and inquiry was made as to the source of the income. The outcomes were positive but it meant more work and more waiting.

Where many families run into a problem is when the primary residence is sold after application or approval. This is considered a conversion of assets and in most cases (depending on the value of net proceeds from sale) will cause the claimant to lose benefits for a period of time whether the assets are transferred or not.

Some are not aware that a 1099 is generated for almost all real estate transactions and a home sale may not be picked up by the VA for several years after the fact. It is a horrible surprise to get a letter from the VA seeking to claw back benefits...and believe it or not, they have the ability to garnish Social Security benefits to satisfy debt incurred by disqualification due to excess resources.
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What benefits specifically are you applying for? Medical only? Service connected disability? Aide & Attendance.

We had no issues whatsoever with a lookback period when we applied for medical and service connected disabily. The issue wasn't even raised.

We haven't applied for Aide & Attendance, so I can't speak to that.

I'm actually kind of surprised that this has become such a concern as I've never heard it mentioned. Asset levels at one time were considered for basic medical.
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Get rid of the attorney, he's dead wrong. Work with the benefits counselor assigned to you by the VA.
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