Code of Federal Regulations Title 38. Pensions, Bonuses, and Veterans' Relief § 38.3.261 Character of income; exclusions and estates

Current as of January 02, 2025 | Updated by Findlaw Staff

The following factors will be considered in determining whether a claimant meets the requirements of §§ 3.250, 3.251 and 3.252 with reference to dependency, income limitations and corpus of estate:

(a) Income.

Income	Dependency (parents)	Dependency and indemnity compensation (parents)	Pension; old-law (veterans, surviving spouses and children)	Pension; section 306 (veterans, surviving spouses and children)	See—
(1) Total income from employment, business, investments, or rents.	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(a).
(2) Income of spouse․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	§ 3.262(b).
(3) Earnings of members of family under legal age	․․do․․․․․․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․	§ 3.250(b)(2). § 3.252(e)(3).
(4) Earned income of child-claimant	․․․․․․․․․․․․․․	․․․․․․․․․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․
(5) Gifts, including contributions from adult members of family:
	Property․․․․․․․․․․․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(k).
	Money․․․․․․․․․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․
(6) Value of maintenance by relative, friend, or organization.	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(c).
(7) Rental value of property owned by and resided in by claimant.	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do
(8) Charitable donations․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	§ 3.262(d).
(9) Family allowance authorized by service personnel.	Included․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	Included.․․․․․
(10) Reasonable value of allowances to person in service in addition to base pay	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	Included except as earned income of child-claimant
(11) Mustering-out pay․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․	․․do
(12) Six-months' death gratuity	․․do․․․․․․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․
(13) Bonus or similar cash gratuity paid by any State based on service in Armed Forces of United States.	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․
(14) Retired Serviceman's Family Protection Plan; Survivor Benefit Plan (10 U.S.C. ch. 73):
	Retired Serviceman's Family Protection Plan (Subch. I):
		Annuities․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
		Refund (10 U.S.C. 1446)	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․
	Survivor Benefit Plan (Subch. II) (Pub. L. 92-425; 86 Stat. 706).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(e).
	Annuity under § 653, Pub. L. 100-456	Included․․․․․․	Included․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(r).
(15) Retirement pay received direct from service department.	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(e).
			․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(h).
(16) Retirement benefits; general	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(e).
(17) Social security benefits:
	Old age and survivors', and disability insurance.	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(f).
		Charitable programs․	Excluded․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	Excluded
		Lump-sum death payments	Included․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
		Supplemental security income	Excluded․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
(18) Railroad Retirement benefits	․․do․․․․․․․․․․․	Included․․․․․․	Disability pension— Excluded Death pension— Included	Included․․․․․․	§ 3.262(g)
(19) Retirement pay waived under Federal statute.	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	§ 3.262(h).
(20) Department of Veterans Affairs payments:
	Pension․․․․․․․․․․․․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․
	Compensation and dependency and indemnity compensation.	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
	World War I adjusted compensation	․․do․․․․․․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․
	U.S. Government life insurance or national service life insurance for disability or death, maturity of endowment policies, and dividends, including special and termination dividends.	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․
	Servicemembers' group life insurance	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
	Veterans' group life insurance	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
	Servicemembers' indemnity	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
	Subsistence allowance (38 U.S.C. ch. 31).	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․
	Veterans educational assistance in excess of amounts expended for training (38 U.S.C. ch. 34).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
	Educational assistance (38 U.S.C. ch. 35).	․․․․․․․․․․․․․․	․․․․․․․․․․․․․․	Excluded․․․․․․	Excluded․․․․․․
	Special allowance under 38 U.S.C. 1312(a).	Excluded․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․
	Statutory burial allowance	․․do․․․․․․․․․․․	Excluded․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․
	Accrued․․․․․․․․․․․․․․․․․	․․do․․․․․․․․․․․	Included, except accrued as reimbursement.	․․do․․․․․․․․․․․	Included, except accrued as reimbursement.
(21) Compensation (civilian) for injury or death.	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(i).
(22) Contributions by a public or private employer to a:
	Public or private health or hospitalization plan for an active or retired employee.	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․
	Retired employee as reimbursement for premiums for supplementary medical insurance benefits under the Social Security Program (Pub. L. 91-588; 84 Stat. 1580).	Included․․․․․․	Included․․․․․․	Excluded․․․․․․	Excluded․․․․․․
(23) Overtime pay; Government employees.	Included․․․․․․	Included․․․․․․	Disability pension— Excluded. Death pension— Included.	Included
(24) Commercial life insurance; disability, accident, or health insurance, less payments of medical or hospital expenses resulting from the accident or disease for which payments are made.	Included (as received).	Included (as received).	Included (special provision).	Included (as received)	§ 3.262(j).
(25) Commercial annuities or endowments.	․․do․․․․․․․․․․․	Included (special provision).	․․do․․․․․․․․․․․	Included (special provision).	§ 3.262(j).
(26) Dividends from commercial insurance	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․
(27) Insurance under Merchant Marine Act of 1936, as amended.	Included․․․․․․	Included․․․․․․	Included․․․․․․	Included․․․․․․
(28) Reimbursement for casualty loss (Pub. L. 100-687)	Included․․․․․․	Excluded․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(t).
	Other fire Insurance․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(t).
(29) Bequests, devises and inheritances:
	Property․․․․․․․․․․․․․․․․	Included․․․․․․	Excluded․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	§ 3.262(k).
	Money․․․․․․․․․․․․․․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․	․․do․․․․․․․․․․․	Included․․․․․․
	Joint bank accounts․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	Excluded․․․․․․	§ 3.262(k)(1).
(30) Profit from sale of property	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(k).
(31) Jury duty or obligatory civic duties	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․
(32) Relocation payments (Pub. L. 90-448; Pub. L. 90-495).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(c).
(33) The following programs administered by the ACTION Agency:
	Foster Grandparent Program and Older Americans Community Service Programs payments (Pub. L. 93-29; 87 Stat. 55).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(q)(1).
	Volunteers in Service to America (VISTA), University Year for ACTION (UYA), Program for Local Services (PLS), ACTION Cooperative Volunteers (ACV), Foster Grandparent Program (FGP), and Older American Community Service Programs, Retired Senior Volunteer Program (RSVP), Senior Companion Program (Pub. L. 93-113; 87 Stat. 394).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(q)(2).
(34) The Service Corps of Retired Executives (SCORE) and Active Corps of Executives (ACE) administered by the Small Business Administration. (Pub. L. 93-113; 87 Stat. 394).	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	․․do․․․․․․․․․․․	§ 3.262(q)(2).
(35) Income received under Section 6 of the Radiation Exposure Compensation Act (Pub.L. 101-426)	Excluded․․․․․․	Excluded․․․․․․	Included․․․․․․	Included․․․․․․	§ 3.262(t)
(36) Income received from income tax returns	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(u)
(37) Other amounts excluded from income by statute	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	Excluded․․․․․․	§ 3.262(v) § 3.279

¹ The compensation received through a crime victim compensation program will be excluded from income computations unless the total amount of assistance received from all federally funded programs is sufficient to fully compensate the claimant for losses suffered as a result of the crime.

(b) Deduction of amounts paid by claimant.


Deduction	Dependency (parents)	Dependency and indemnity compensation	Pension; old-law (veterans, surviving spouses, and children)	Pension; section 306 (veterans, surviving spouses, and children)	See
(1) Unusual medical expenses	Not authorized	Authorized․․․․	Not authorized	Authorized	§§ 3.262(b)(1) and (1).
(2) Veteran: just debts, expenses of last illness and burial	Not authorized	Authorized, except debts	Not authorized	Authorized	§§ 3.262(m) and (o).
(3) Veteran's spouse or child; expenses of last illness and burial	Not authorized	Not authorized	Not authorized	Authorized	§ 3.262(n).
(4) Parent's spouse: just debts; expenses of last illness and burial	Not authorized	Authorized․․․․	․․․․․․․․․․․․․․․․․․․․․․․․․․	․․․․․․․․․․․․․․	§ 3.262(o).
(5) Prepayment on real property mortgages after death of spouse (Pub. L. 91-588)	Not authorized	Not authorized	Not authorized	Authorized	§§ 3.262(k) (6).

	Dependency (parents)	Dependency and indemnity compensation	Pension; old-law (veterans, widows, and children)	Pension; section 306 (veterans, surviving spouses, and children)	See
	Considered conditionally	Not considered	Not considered	Considered	§3.263.

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Cite this article: FindLaw.com - Code of Federal Regulations Title 38. Pensions, Bonuses, and Veterans' Relief § 38.3.261 Character of income; exclusions and estates - last updated January 02, 2025 | https://codes.findlaw.com/cfr/title-38-pensions-bonuses-and-veterans-relief/cfr-sect-38-3-261/

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