Reference: For more information about handling incomplete applications, see M21-1, Part I, 1.B.1.b. c. Determining the Entitlement of an Incarcerated Veteran’s Dependent(s) to Pension The entitlement of a Veteran’s dependent(s) to pension during the Veteran’s incarceration is based on the following factors except for the Veteran’s incarceration, the Veteran must otherwise remain eligible to receive pension, and the Veteran’s dependent(s) must meet the income requirements for Survivors Pension (without consideration of the Veteran’s income). d. Determining the Amount of Pension VA May Pay to the Dependent(s) of an Incarcerated Veteran limits the amount of pension VA may pay to an incarcerated Veteran’s dependent(s) to the lesser of the following the amount of pension to which the Veteran was entitled before VA discontinued his/her pension due to incarceration, or the amount of Survivors Pension to which the dependent(s) would be entitled based on current income. Scenario: In April 2006, VA discontinued the payment of pension to a Veteran, effective January 10, 2006, due to his incarceration. Prior to this action, VA had been paying the Veteran $1,305.00 per month, based on annual income for VA purposes (IVAP) of $1800.00. This amount included additional benefits for a spouse and two children. In May 2006, the Veteran’s spouse requested the payment of pension for herself and the two children during the Veteran’s incarceration. The spouse’s and children’s annual IVAP is $900.00. Result: limits the monthly amount of pension VA may pay to the spouse and children to $849.00. This represents the monthly amount of Survivors Pension to which the spouse would be entitled, which is also less than the monthly amount of pension to which the Veteran was entitled prior to incarceration.
Important: Do not reduce a Veteran’s compensation based on his/her incarceration if the incarceration is for conviction of a misdemeanor. b. Resuming the Benefits of a Veteran Entitled to Both Compensation and Pension When Incarceration Ends If a Veteran entitled to both compensation and pension was receiving compensation in lieu of pension during incarceration, follow the instructions in the table below when incarceration ends. If ... Then ... compensation continues to be the greater benefit after incarceration ends adjust the Veteran’s award according to the instructions in M21-1, Part III, Subpart v, 8.A.5, and M21-1, Part III, Subpart v, 8.B.2.h through j, as applicable. pension is the greater benefit after incarceration ends, and VA was not apportioning the Veteran’s compensation to his/her dependent(s) while the Veteran was incarcerated follow the instructions in M21-1, Part III, Subpart v, 8.A.5 for selecting an effective date for resuming the payment of pension. pension is the greater benefit after incarceration ends, and VA was apportioning the Veteran’s compensation to his/her dependent(s) while the Veteran was incarcerated discontinue the apportionment to the Veteran’s dependent(s) effective the first of the month following the month for which VA last paid the apportionment for the period between the date incarceration ended and the first of the month following the month for which VA last paid the apportionment, pay the Veteran the difference between the full amount of pension to which he/she is entitled, and the amount of the apportionment resume payment of the full amount of pension to which the Veteran is entitled effective the first of the month following the month for which VA last paid the apportionment, and notify both the Veteran and his/her dependent(s) of the adjustments made to their individual awards, according to the instructions in M21-1, Part III, Subpart v, 2.B. Inform the dependent(s) that he/she(they) may submit a claim for an apportionment of the Veteran’s benefits if, after incarceration, the Veteran no longer resides with the dependent(s).