**CHAPTER 11. PAYMENT OF ANNUAL CLOTHING ALLOWANCE**

**CONTENTS**

PARAGRAPH PAGE

11.01 General 11-1

11.02 Processing for Payment 11-1

11.03 Termination of Entitlement 11-1

11.04 Changes in Entitlement Status 11-2

11.05 Redetermination of Eligibility 11-2

11.06 Notice to Veteran 11-2

11.07 Returned Checks 11-3

11.08 Annual CAP Computer Run 11-3

**CHAPTER 11. PAYMENT OF ANNUAL CLOTHING ALLOWANCE**

**11.01 GENERAL**

a\. An Annual Clothing Allowance Payment (ACAP) is made to veterans with
existing eligibility as of August 1.

b\. The processing of an authorization of payment of a current or future
ACAP establishes the C&P master record code to provide for authorized
recurring annual payments or for a computer-generated letter/application
to permit development of entitlement for a subsequent ACAP. See
paragraph 11.08 for ACAP computer run.

c\. The pay date for authorized ACAP\'s based on prior recorded master
record data will be the first of September, i.e., checks will be issued
September 1, 1992, for those persons entitled on August 1, 1992.

**11.02 PROCESSING FOR PAYMENT**

The method used to authorize payment of ACAP depends on the year of
entitlement and the date of the determination/payment action.

a\. **Entitlement/Payment for Current Year.** If entitlement is
established for the current year, payment may be authorized using the
CORR command through the last input cycle of August.

\(1\) **Continuing Entitlement Established.** Enter RECUR in the CLOTH
ALLOW field on the M11 Screen.

\(2\) **Pay Current, Futures to be Authorized.** Enter NEXT ONLY in the
CLOTH ALLOW field on the M11 Screen.

\(3\) **Current Cycle Updated.** As of September Cycle 0, the current
year for clothing allowance is updated. Payments authorized after the
last input cycle of August should be referred to Finance for 06K
processing. If a CORR transaction is done after that time, payment will
not be released until the following EOM August. For example, on
September 15, 1992, it is determined that eligibility to clothing
allowance existed on August 1, 1992. If a CORR transaction were done on
September 15, 1992, with an entry of either RECUR or NEXT ONLY, a
payment would not be released until September 1, 1993. An 06K
transaction by Finance is required to release the prior (1992) payment.

b\. **Entitlement/Payment for Prior Year.** If entitlement is
established for a prior year or years, check Block 1 and Block a or b,
as appropriate, in Part II of VA Form 21-8679. The years of each August
1 entitlement will be entered, e.g., 1991 and 1992. The Finance activity
will process separate 06K transactions for each ACAP indicated.

c\. **Entitlement for Future Year.** If entitlement for the current year
is not established but entitlement for the future year is, authorization
will process a CORR transaction. It is imperative this not be done until
after the last cycle of August. If a clothing allowance award based on
future eligibility is CORR\'d before or during the last cycle of August,
payment would occur at an erroneous rate, i.e., eligibility established
from August 3, 1992, must not be input prior to Cycle 0 September 1992.

**11.03 TERMINATION OF ENTITLEMENT**

Indicate termination of eligibility previously established if a veteran
becomes ineligible to receive the annual allowance because of medical
determination or other reason. Using the CORR command, enter NOT ENTIT
in the CLOTH ALLOW field on the M11 Screen. This will remove the master
record controls for future payments or release of redetermination
application.

**11.04 CHANGES IN ENTITLEMENT STATUS**

a\. If entitlement status changes, i.e., from recurring to futures must
be authorized or vice versa, authorization will process a CORR
transaction. The allowable entries under these conditions are:

**CURRENT STATUS (M11) ALLOWABLE ENTRIES VIA CORR**

Blank RECUR, NEXT ONLY

XXXX RECUR NEXT ONLY, NOT ENTIT

XXXX REVUE RECUR, NEXT ONLY, NOT ENTIT

NEXT XXXX RECUR, NOT ENTIT

(XXXX = last year in which payment was made)

b\. If the year shown on the M11 Screen is not equal to the current
processing year, NOT ENTIT must be entered. On updating of the master
record, a subsequent CORR entry may be made to reestablish entitlement
as appropriate. Payment for any intervening years will be made by the
Finance division via 06K transactions.

**EXAMPLE:** M11 Screen on July 15, 1992, shows 1990 RECUR. Do a CORR
transaction to clear the master record controls and have Finance do an
06K to pay 1991 if not previously paid. Do a subsequent CORR to
reestablish entitlement, if still applicable.

**11.05 REDETERMINATION OF ELIGIBILITY**

a\. Master records set to require annual redetermination of eligibility
will be identified at the end of July for issuance of a
computer-generated letter/application for completion by the veteran and
return to Adjudication for appropriate action.

b\. Payment of the current year clothing allowance will depend on
receipt of the application and favorable determination of eligibility on
August 1 of the same year.

c\. No control will be maintained for receipt of the completed
application. See paragraph 11.08.

**NOTE:** Authorization of clothing allowance to veterans who are not in
receipt of compensation because they are receiving retired pay or for
other reasons and for whom a type A master record does not exist, can
**ONLY** be made for the current annual payment, not on a recurring
basis. If continuing eligibility is established on a factual basis,
payment of the next and succeeding ACAP\'s may be made after
ascertaining the veteran\'s current address. A redetermination of
eligibility on the basis of the subsequent claim will **NOT** be
required if the initial approval was based on a static qualifying
disability. Maintain a local control for the appropriate action as of
August 1 of the next year. See exception 1 to paragraph 11.06.

**11.06 NOTICE TO VETERAN**

a\. Each ACAP check issued will contain the statement VA CLOTHING to
identify the benefit paid. A letter will not generally be required if
immediate payment for a current ACAP is authorized.

b\. There are several exceptions to this rule.

**EXCEPTION 1:** As provided in the note to paragraph 11.05, in any case
in which there is no type A master record, a locally generated letter
must be prepared to advise the veteran of each payment and that to
receive the next annual payment, the claim form which will be furnished
on or about the following August 1 must be completed and returned.

**EXCEPTION 2:** If payment for a future year is authorized (as in
entitlement effective August 1, 1992, established during March 1992) or
in cases of terminated or disallowed claims, authorization will notify
the veteran of the decision by letter.

**11.07 RETURNED CHECKS**

A returned clothing allowance check will result in issuance of MSG 607,
MISC. RETURNED CHECKS, to the Finance activity for appropriate action.
Data for such returned checks will not be retained in the master record.
As no proceeds segment will be established, a new 06K transaction will
be required to reissue payment.

**11.08 ANNUAL CAP COMPUTER RUN**

The master record data established to provide for recurring payments or
for a future computer-generated letter/application will be used in a
two-phase ACAP Selection Run of master records. At the end of July,
cases requiring redetermination of eligibility will be selected for
issuance of a generated letter/application. Cases in which the master
record data provide for recurring annual payments and those Pay Next
Year coded for this ACAP will be selected at the end of August for a
September 1 payment for the current year.

a\. If the master record in a selected case contains no address, as in a
record-purpose award, MSG 777 - CLOTHING ALLOWANCE DUE - NO ADDRESS IN
M/R or MSG 777C - RELEASE CLOTHING ALLOWANCE APPLICATION will issue in
lieu of automatic payment or generated letter/application. These cases
will require an 06K transaction to effect payment.

b\. In any case where payment of an annual clothing allowance is made
but the master record does not indicate a service-connected disability,
MSG 777B - CLOTHING ALLOWANCE PAID - NO S/C DISABILITY will be issued
for review as to the propriety of the payment and any necessary input,
including service-connected diagnostic codes.

c\. In certain cases, payment of ACAP may be due but payment is not
possible based on the status of the case. MSG 777E - CL ALLOW DUE - M/R
SUSPENDED will be issued in those cases where payment may not be made
because the record is in a suspended status. MSG 777F will be issued at
the end of July if the application was neither released nor input to
update the record and make payment. MSG 777F may also be issued at
end-of-month August if the automatic annual payments have been
interrupted without resumption..