Introduction This topic contains information on evaluating evidence of self-employment or employment with a tightly held corporation, including self-employment development deciding whether self-employed individuals are unemployable due to an SC disability the definition of a tightly held corporation, and evaluating evidence showing income from a tightly held corporation. Change Date July 24, 2015 a. Development Development to produce the evidence necessary to establish the degree to which SC disability has impaired the Veteran’s ability to engage in must generally be more extensive than development in cases in which the Veteran worked for others. Request that the Veteran furnish a statement regarding the types of work performed number of hours worked per week, and amount of time lost in the previous 12 months due to SC disabilities. b. Deciding Whether Individuals Are Unemployable Due to an SC Disability When determining entitlement of self-employed individuals to increased compensation based on IU, consider the relationship between the frequency and the type of service performed by the Veteran for his/her business and the Veteran’s net and gross earnings for the past 12 months. Consider facts of the case, such as low gross earnings that support a finding of marginal employment, especially when the amount of time lost from work due to SC disability is taken into account, or high gross earnings that indicate the Veteran is capable of engaging in a substantially gainful occupation. Notes: Consider low net earnings in conjunction with gross income. The inability to make a profit is not always indicative of the inability to engage in substantially gainful employment. c. Definition: Tightly Held Corporation A tightly held corporation (or closely held corporation) is usually a family corporation. A corporation bearing the Veteran’s name is usually indicative of a tightly held corporation. Employed
requested completion of the VA Form 21-8940 as Month DD, YYYY], we wrote and asked you to send us a completed VA Form Veteran’s Application for Increased Compensation Based on Unemployability. As of this date, we have not received a complete VA Form 21-8940. This form is required to further consider your claim. IU is established include an explanation or analysis of how impairment from SC disability supports the decision, and specify which disability(ies) render the Veteran unemployable. Important: A conclusory statement alone that the criteria for a total evaluation based on IU are met does not satisfy the requirement to state the basis for the decision. permanency of the IU evaluation is established award Dependents’ Educational Assistance (DEA) under , regardless of whether or not there appear to be any potential dependents. Note: The rating conclusion must include the statement, Basic eligibility under 38 U.S.C. Chapter 35 is established from [date]. References: For more information on IU, see , and unemployability, see . m. Handling Intertwined IU Claims and Appeals The table below provides guidance on properly handling intertwined IU claims and appeals. If the Veteran has an appeal pending And while the appeal is pending Then for an increased evaluation for an SC disability the Veteran claims to be unemployable due, at least in part, to the disability on appeal, and the TDIU claim is now part of the pending appeal. Send the appellant a Statement of the Case (SOC) or Supplemental
the rating decision denies the TDIU claim Statement of the Case (SSOC) on all issues on appeal, including IU. on a denial of IU benefits the Veteran subsequently claims that an SC disability not on appeal causes unemployability, and the rating decision fails to increase the evaluation to the schedular maximum that disability will also be considered in appellate status. Send the appellant an SOC or SSOC regarding the evaluation of that disability. Reference: For more information on preparing an SOC and SSOC, see I, 5.D. 5. Special Considerations in IU Claims Introduction This topic contains information on special considerations in IU claims, including handling claims requiring Central Office (CO) approval monitoring changes in employability status when monitoring changes in employability status is not required dispatch and control for the return of VA Form 21-4140, Employment Questionnaire the action taken when Hines Information Technology Center (ITC) cannot issue VA Form 21-4140 if VA Form 21-4140 or VA Form 21-4140-1, Employment Questionnaire, shows continued unemployability, or by the Intake Processing Center (IPC) if VA Form 21-4140 indicates Veteran may be employed determining whether the Veteran has sustained gainful employment action taken if VA Form 21-4140 is not returned action taken if the Veteran returns a signed VA Form 21-4140 during the due process period, and action taken if the Veteran fails to cooperate with a required field examination. Change Date September 24, 2015
possible gainful employment refer to the table below. k. Action Taken if the Veteran Fails to Cooperate With a Required Field Examination Follow the steps in the table below when the Veteran fails to cooperate with a required field examination. Step Action 1 Prepare a rating decision proposing a reduced evaluation using the format in M21-1, Part IV, Subpart ii, 2.F.6. 2 Use the table below to determine the action to take upon receipt of the Veteran’s response to the notice of proposed adverse action.