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M21-1, Part III, Subpart iii, Chapter 5, Section J – Establishing Parental Dependency

Overview


In This Section

This section contains the following topics:

1.  General Information on Establishing Parental Dependency


Introduction

 
This topic contains information on handling issues of parental dependency, including

Change Date

July 11, 2015

III.iii.5.J.1.a.Definition:  Members of the Family

 
The term members of the family, for purposes of determining conclusive dependency in domestic cases, and for determining factual dependency in foreign and domestic cases, includes relatives
  • under age 21 who are supported by a parent under legal or moral obligation, and
  • over age 21 who are dependent on the parent because of physical or mental incapacity.

III.iii.5.J.1.b.  Consideration of Parental Relationship and Dependency

 
The issue of whether or not a Veteran’s parent is dependent is distinct from the issue of whether or not the parental relationship may be established.
Disability and Death Compensation:  Both the parental relationship anddependency of the parent must be established in order for the Department of Veterans Affairs (VA) to pay additional disability compensation for a parent or pay death compensation to a parent.
Parents’ Dependency and Indemnity Compensation (DIC):  Dependency is notan issue in Parents’ DIC claims, although entitlement to Parents’ DIC, as well as the rate that is payable, are both determined by the parents’ income for VA purposes.
References:  For more information on

III.iii.5.J.1.c.Effective Date of Parental Dependency

 
It is not material whether the parent’s dependency arose before or after the Veteran’s death.  The relevant question is whether or not the parent is dependenton the date of entitlement to benefits.

III.iii.5.J.1.d. How Marriage Affects Parental Dependency

 
A parent’s marriage has no bearing on the parent’s dependency, except to the extent that it changes the
  • parent’s financial situation, and
  • income limit for conclusive dependency.
References:  For more information on

III.iii.5.J.1.e.  Initial Development to Determine Parental Dependency

 
If taking initial development action to determine the dependency of a parent, send the claimant VA Form 21P-509Statement of Dependency of Parent(s).
  • is also used to determine continued dependency if evidence is received that a dependent parent has married, and
  • may be mailed to the claimant by using the appropriate development letter.

III.iii.5.J.1.f.  Action to Take if Additional Information Is Required

 
If additional information is required to determine the dependency of a parent, develop by:

III.iii.5.J.1.g.  Obtaining Evidence Pertaining to a Parent’s Marriage

 
If evidence is received showing a dependent parent has married, advise the beneficiary that VA Form 21P-509 must be completed to establish that continued dependency exists.
If the beneficiary fails to respond to VA Form 21P-509, furnish a notice of proposed adverse action under 38 CFR 3.652.
Reference:  For more information on conclusive dependency, see M21-1, Part III, Subpart iii, 5.J.2.

III.iii.5.j.1.h.  Establishing Dependency in Domestic and Foreign Cases

 
The table below shows when dependency may be established in domestic and foreign cases.
If the case is a …
Then dependency may be established …
domestic case
  • when conclusive dependency is established, or
  • on a factual basis, if conclusive dependency cannot be established.
foreign case
on a factual basis only.
Note:  Conclusive dependency does not apply in foreign cases.
References:  For more information on

2.  Conclusive Dependency of a Parent – Domestic Cases Only


Introduction

 
This topic contains information on conclusive dependency in domestic cases, including

Change Date

October 11, 2010

III.iii.5.J.2.a.  Income Limits for Parental Dependency

 
Conclusive dependency of a parent, other than a parent who resides in a foreign country, exists when the monthly income of the parent(s) does not exceed
  • $400 for a mother or father living alone, or
  • $660 for a
    • mother and father, or
    • remarried parent and spouse living together.
Reference:  For more information on the income limits for a parent and a parent’s spouse, see 38 CFR 3.250.

III.iii.5.J.2.b.Effect of Additional Family Members on Income Limits

 
Add $185 to the conclusive dependency income limit for each additional member of the family who the parent is under a legal or moral obligation to support.

III.iii.5.J.2.c.  Income Considerations for Additional Family Members

 
If $185 is added to the conclusive dependency income limit for an additional member of the family
  • consider any income of the family member that is available to the parent for support of the family member, and
  • do not consider the family member’s net worth unless it is actually available to the parent.

III.iii.5.J.2.d.  Effect of Net Worth on Parental Dependency

 
If family income is within the income limits specified under 38 CFR 3.250, net worth is not a factor.
If, however, the claimant reports substantial net worth, determine whether
  • the assets are the type that should be generating interest or dividends, and
  • all interest and dividends were reported.

3.  Factual Dependency–Foreign Cases and Domestic Cases


Introduction

 
This topic contains information on factual dependency in foreign and domestic cases, including

Change Date

October 11, 2010

III.iii.5.J.3.a.  Standard to Determine Factual Dependency

 
In all foreign cases and in those domestic cases where income exceeds the limits for conclusive dependency under 38 CFR 3.250, use the following standard to determine whether factual dependency exists:  Does the parent have sufficient income and/or net worth to provide reasonable maintenance for himself/herself and for members of his/her family?
If the answer is no, dependency exists.
Note:  There are no hard and fast rules for determining whether factual dependency exists.  This is a discretionary determination that is made by development and/or authorization activity.

III.iii.5.J.3.b.  Net Worth Considerations

 
If conclusive dependency cannot be established, net worth must be considered.  Evaluate a parent’s net worth separately even if the parents are living together.
The table below describes considerations with regard to
  • net worth and
  • establishing factual dependency.
If …
Then …
it is reasonable to expect the parent’s net worth may be consumed for the parent’s maintenance
deny factual dependency.
  • one parent is not considered dependent because of excessive net worth, and
  • the assets are
    • one parent’s separate property, and
    • not joint or community property
it is possible for one parent to be found dependent and the other not dependent, even though they live together in the same household.
Note:  Attribute half of all joint or community property to each parent.
Reference:  For more information, seeM21-1, Part III, Subpart iii, 5.J.3.c.
  • a parent marries someone who is not the Veteran’s other parent, or
  • two parents live together but only one files for death compensation
only consider
  • the claimant’s individual net worth, and
  • half of any joint or community property.
Reference:  For more information, see38 CFR 3.263.

III.iii.5.J.3.c.Dependency of One of Two Parents Not Established

 
If one parent’s claim is denied because of non-dependency, but the other parent’s claim is awarded, the successful claimant is entitled to the single parent rate.

 

4.  Administrative Decisions–Dependency Determinations


Change Date

August 14, 2006

III.iii.5.J.4.a.  Administrative Decisions

 
Use the table below to determine the appropriate actions to take when
  • factual dependency exists, or
  • dependency cannot be established.
If …
Then …
  • factual, as opposed to conclusive, dependency exists, and
  • a parent’s estate is $80,000 or more
a decision is made that factual dependency cannot be established
prepare a two-signature administrative decision using the format in M21-1, Part III, Subpart v, 1.A.3.
Note:  Prepare the decision on VA Form 21-5427 when the basis for denial or discontinuation is excessive net worth.

5.  Requests for Proof of Continued Dependency in Connection With Award Action


Introduction

 
This topic contains information about proof of dependency, including

Change Date

September 6, 2018

III.iii.5.J.5.a.  When to Require Proof of Continued Dependency

 
Proof of continued dependency is required for award action in disability and death compensation cases when the information on VA Form 21P-509 is over a year old.
Example:  Situations may arise in which a determination of entitlement has been delayed pending receipt of
  • service records, or
  • other evidence.

III.iii.5.J.5.b.  Obtaining Proof of Continued Dependency in Death and Disability Cases

 
Follow the steps in the table below to request proof of continued dependency in death and disability cases when taking award action.
Step
Action
1
Review the application and the claims folder.
2
Is there any evidence that indicates the dependency status has changed?
  • If yes, proceed to the next step.
  • If no, proceed to Step 5.
3
Send a letter to the claimant asking him/her to
4
Did the claimant return VA Form 21P-509 within 30 days?
  • If yes,
    • take award action based on the evidence of record and information contained on VA Form 21P-509, and
    • proceed to Step 24.
  • If no, and the claim is for
    • death compensation,
      • deny the claim, and
      • proceed to Step 24, or
    • disability compensation,
      • process the award but deny the claim for additional benefits for the parent, and
      • proceed to Step 24.
5
Is the information on VA Form 21P-509 over a year old?
  • If yes, proceed to Step 8.
  • If no, proceed to the next step.
6
Is the claimant eligible for benefits as or for a parent during a period of time that precedes the 12-month period of time for which the claimant provided income and expenses on the VA Form 21P-509 of record?
  • If yes,
    • award benefits effective the first of the month following the earliest month for which income and expenses were provided on the form,
    • leave the end product (EP) associated with the award pending, and
    • ask the beneficiary (in the corresponding decision notice) to complete and return within 30 days anotherVA Form 21P-509 for each 12-month period that precedes the 12-month period the VA Form 21P-509of record covers.
  • If no,
    • process the award, and
    • proceed to Step 24.
7
Did the beneficiary return the VA Form(s) 21P-509 within 30 days?
  • If yes,
    • award benefits effective the first of the month following the earliest date on which eligibility existsand dependency is demonstrated, and
    • proceed to Step 24.
  • If no,
    • clear the pending EP, and
    • take no further action.
8
If the claim is for
  • death compensation, proceed to the next step, or
  • disability compensation, proceed to Step 10.
9
  • Process the award.
  • Send the parent VA Form 21P-509 with the decision notice.
  • Advise the parent that failure to return the completed form within 30 days will result in discontinuation of his/her benefits.
  • Proceed to Step 11.
10
  • Process the award.
  • Send the Veteran VA Form 21P-509 with the decision notice.
  • Advise the Veteran in the decision notice that failure to return the completed form within 30 days will result in discontinuation of the additional benefits for the parent.
11
Establish a diary under diary code 22, Verify Income or Dependency, that will expire in 30 days.
12
Did the beneficiary return VA Form 21P-509 within 30 days?
  • If yes,
    • clear the diary established in the preceding step (if it is still pending), and
    • proceed to the next step.
  • If no, proceed to Step 16.
13
Does the VA Form 21P-509 contain information that necessitates an award adjustment?

  • If yes,
    • establish EP 130, using the date VA received the form as the date of claim, and
    • proceed to the next step.
  • If no,
    • clear an EP 692, and
    • disregard the remaining steps in this table.
14
Will the award adjustment create an overpayment?
  • If yes,
    • add Potential Under/Overpayment as a special issue under the EP 130, and
    • proceed to the next step.
  • If no,
    • make the award adjustment under the pending EP 130, and
    • proceed to Step 24.
15

Make the award adjustment under the pending EP 130 and proceed to Step 24.

16
  • Clear the 810 work item that was automatically generated when the diary established in Step 11 expired.
  • Establish EP 130.
    • Use the date of the 810 work item as the date of claim.
    • Add Potential Under/Overpayment as a special issue.
Reference:  For more information on 800-series work items, see
17
Under the pending EP 130, suspend payments to the parent or discontinue the payment of additional benefits for the parent effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share.
18
Establish EP 600 and add Potential Under/Overpayment as a special issue.
19
Send a notice of proposed adverse action that
  • proposes to discontinue benefits VA paid to or for the parent effective the same date VA first paid them
  • contains the elements in M21-1, Part I, 2.B.2, and
  • informs the beneficiary that he/she must return VA Form 21P-509 within 60 days.
20
Did the beneficiary return VA Form 21P-509 within 65 days?
  • If yes, proceed to the next step.
  • If no,
    • take the action proposed in the notice of proposed adverse action, and
    • proceed to Step 24.
21
Is an award adjustment necessary based on information contained onVA Form 21P-509?

  • If yes, proceed to the next step.
  • If no, proceed to Step 23.
22
Adjust the award under the pending EP 600 and proceed to Step 24.
23
Clear the EP 600.
24
Prepare a decision notice and send it to the claimant/beneficiary.
Reference:  For more information about preparing decision notices, see M21-1, Part III, Subpart v, 2.B.1.

6.  Follow-Ups to Determine Whether Dependency Has Ceased


Introduction

 
This topic contains information about conducting follow-ups to determine whether dependency has ceased, including

Change Date

July 11, 2015

III.iii.5.J.6.a.  Follow-Ups on Dependency Status

 
Under certain circumstances, an award may be made for a parent whose present economic status warrants a determination of dependency, but whose financial situation may reasonably be expected to improve in the future.
Examples:  This situation may exist in cases in which
  • the parent is comparatively young and has been unemployed because of poor health, or
  • the award is predicated on the parent’s financial responsibility with regard to minor children.

III.iii.5.J.6.b.  Corporate Record Control of Dependency Issues

 
If an award is made and there is a reasonable expectation that the parent’s financial situation may improve, establish a diary under reason code 22, Verify Income or Dependency, for a follow-up at an appropriate date to determine whether dependency has ceased.
Reference:  For more information for establishing a diary in Share, see the Share User Guide.

III.iii.5.J.6.c.  Duration of Control for Dependency Follow-Up

 
If it appears probable that the parent’s financial situation may improve by reason of recovery of employability or similar circumstances, where a future date cannot be definitely estimated, establish the control for one to two years.

III.iii.5.J.6.d.  Parent Responsible for Minor Children

 
If the parent’s dependency is based on financial responsibility for a minor child or children, establish
  • a diary for release of the follow-up letter approximately 30 days prior to the date when the child (oldest child if more than one child is involved) will attain age 18, then
  • a 30-day suspense period for receipt of the required evidence/information.

7.  Changes in Marital and Dependency Status of Parents in Disability and Death Compensation Cases


Introduction

 
This topic contains information about changes in the marital and dependency status of parents in disability and death compensation cases, including

Change Date

March 19, 2018

III.iii.5.J.7.a.When to Reevaluate Dependency

 
Reevaluation of a parent’s dependency is required when there is any
  • change in a parent’s marital status, and
  • significant change in a parent’s income or net worth.

III.iii.5.J.7.b.  Handling Cessation of Dependency

 
If it is determined that a parent is no longer dependent because of a change in economic status, provide a notice of proposed adverse action.
Exceptions:  There is no need to prepare and issue a notice of proposed adverse action if a
  • Veteran in receipt of additional disability compensation for a parent notifies VA the parent is no longer financially dependent on the Veteran, or
  • parent in receipt of death compensation reports a change in economic status that renders the parent ineligible for death compensation.

III.iii.5.J.7.c.  Reducing or Discontinuing Awards

 
Reduce a disability compensation award or discontinue a death compensation award effective the first day of the calendar year following the calendar year during which dependency ceased.
References:  For more information on

III.iii.5.J.7.d.  Award Adjustment When the  Dependency of One Parent, on a Two-Parent Award, Ceases

 
Follow the steps in the table below if it is determined that one of two parents receiving death compensation is no longer dependent, but the other parent continues to be dependent.
Step
Action
1
Provide a notice of proposed adverse action to the parent who is no longer dependent and inform the parent that he/she must reply within 60 days.
2
Was evidence received within 65 days showing the parent in question remains dependent?
  • If yes, continue the award and notify the parent of the decision.
  • If no,
    • discontinue the award of the parent in question
    • increase the rate for the remaining parent to that payable under dependency code 50 or 60 (whichever is appropriate), effective the date of discontinuation of the other parent’s award,
    • and notify each parent of the actions taken.
Reference:  For more information on award adjustment when the dependency of one parent, on a two-parent award, ceases, see 38 CFR 3.651.

8.  Death of One of Two Dependent Parents


Introduction

 
This topic contains information on the death of one of two dependent parents, including

Change Date

October 11, 2010

III.iii.5.J.8.a.  Action Taken on the Death of One of Two Parents

 
The table below describes the action taken in cases where one of two dependent parents dies.
Type of Benefit
Action
Additional Information
death compensation
  • Discontinue the deceased parent’s award effective the first day of the month of death.
  • Increase the remaining parent’s benefits to the rate payable under dependency code 50 or 60 (whichever is appropriate),effective the date of discontinuation of the other parent’s award.
For more information on how the death of one of two dependent parents affects death compensation benefits, see
disability compensation
Reduce the Veteran’s award to the rate for a Veteran with one dependent parent effective the first of the month after the month of the parent’s death.
Note:  If the parent died before October 1, 1982, the reduction is effective the first of the year after the year of the parent’s death.
For more information on how the death of one of two dependent parents affects disability compensation benefits, see 38 CFR 3.500(g)(2).
parents’ DIC
For more information on how the death of one of two dependent parents affects parents’ DIC, see M21-1, Part V, Subpart iii, 1.D.6.

III.iii.5.J.8.b.Automatic Rate Adjustment for Remaining Parent

 
When one parent is removed from a two-parent death compensation award because of death or cessation of dependency, VA automatically increases the rate payable to the remaining parent.  A specific claim for increased benefits from the remaining parent is not required.
Reference:  For more information on increasing the death compensation rate payable to a remaining parent, see 38 CFR 3.651(a).

III.iii.5.J.8.c.  Handling VA’s Failure to Make a Rate Adjustment Due to an Administrative Error

 
If VA fails to increase the rate payable to the surviving (or remaining) parent due to an administrative error, there is no time limit for making the adjustment.
Example:
  • 1981:  A father in receipt of death compensation dies.  The father’s award is stopped in a timely manner, but VA fails to increase the mother’s award (who is also in receipt of death compensation) to the single parent rate.
  • 1990:  The oversight is discovered.  The mother is entitled to the single parent rate effective the first of the month of the father’s death.

9.  Reestablishment of Parental Dependency


Introduction

 
This topic contains information about reestablishment of parental dependency, including

Change Date

March 19, 2018

III.iii.5.J.9.a.  When to Resume Payments for a Dependent Parent

 
If payments of death compensation are discontinued or additional disability compensation payments are reduced because a parent was determined not to be dependent, resume payments effective the date dependency again arises.
Important:  Satisfactory evidence must be received within one year from the date of notice of the discontinuation or reduction.  Otherwise, the effective date is determined by the date of claim subject to 38 CFR 3.31.

III.iii.5.J.9.b.  Example:  Dependency Reestablished and Payments Resumed

 

Scenario:
  • On October 15, 2001, VA receives notification from a parent in receipt of death compensation that she
    • accepted a job that pays $60,000 per year, and
    • received her first paycheck on September 29, 2001.
  • On October 20, 2001, VA
    • determines the parent is no longer entitled to death compensation (because dependency has ceased), and
    • discontinues the parent’s benefits effective January 1, 2002, per38 CFR 3.660(a)(2).
  • On February 13, 2002, VA receives an application for death compensation from the parent who states she quit her job and received her last paycheck on January 26, 2002.
Result:  The effective date of entitlement to death compensation is January 27, 2002.  The effective date of payment (after the application of 38 CFR 3.31) is February 1, 2002.
Note:  Had the parent received her last paycheck before December 31, 2001, benefits would have continued uninterrupted since VA could not discontinue benefits from an effective date earlier than January 1, 2002.

III.iii.5.J.9.c.  Award Adjustment for Adding a Parent Back Onto a Two-Parent Award

 
If, because dependency has ceased, one parent is removed from a two-parent award of death compensation, and the parent whose award was stopped subsequently submits new evidence reestablishing entitlement, follow the instructions in the table below.
Note:  The instructions in the table below are for application whether the parents are living together or apart from one another.
Step
Action
1
Furnish a notice of proposed adverse action to the parent who is still receiving death compensation (Parent A).
2
Establish a 65-day control.
3
At the end of the control period,
  • pay to the parent whose award was stopped (Parent B)
    • the full amount of benefits to which Parent B is entitled, effective the first of the month following the month for which VA last paid Parent A, and
    • the difference between the two-parent rate and the single-parent rate that was paid to Parent A for any period of entitlement that precedes the first of the month following the month for which VA last paid Parent A, and
  • reduce Parent A’s award to the two-parent rate effective the first of the month following the month for which VA last paid that parent.
Important:  Do not create an overpayment in the other parent’s account.

III.iii.5.J.9.d.  Example:  Dependency Reestablished and Award Adjusted

 
Scenario:
  • On October 28, 2001, VA determines one of two parents (the mother) in receipt of death compensation is no longer dependent.  Effective January 1, 2002, VA
    • discontinues the mother’s award, and
    • increases the father’s award to the single-parent rate of $75.00 per month.
  • On March 14, 2002, VA receives evidence that reestablishes the mother’s dependency from October 28, 2001.
  • On April 25, 2002, VA sends a notice of proposed adverse action to the father.
  • The father does not respond to the notice of proposed adverse action.
  • Action to process the pending EP 600 is taken on August 7, 2002.  (August 1, 2002, represents the first day of the month following the month for which VA last paid death compensation to the father.)

Award Action/Adjustment:

  • Pay the mother $5.00 per month from January 1, 2002, to August 1, 2002.
  • Pay the mother the full monthly rate of $40.00 effective August 1, 2002.
  • Reduce the father’s monthly rate to $40.00 effective August 1, 2002.
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