[Federal Register Volume 59, Number 131 (Monday, July 11, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16625]


[[Page Unknown]]

[Federal Register: July 11, 1994]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 3

RIN 2900-AG70

 

Exclusions From Income (Just Debts)

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) has amended its 
adjudication regulations concerning income exclusions in death cases. 
The purpose of the amendment is to make it clear that secured debts 
cannot be considered ``just debts'' for purposes of the income 
exclusion.

EFFECTIVE DATE: This amendment is effective August 5, 1993, the date of 
the General Counsel opinion upon which it is based.

FOR FURTHER INFORMATION CONTACT: Paul Trowbridge, Consultant, 
Regulations Staff, Compensation and Pension Service, Veterans Benefits 
Administration, 810 Vermont Avenue, NW., Washington, DC 20420, 
telephone (202) 233-3005.

SUPPLEMENTARY INFORMATION: Rates payable under VA's income-based 
benefit programs, pension and parents' dependency and indemnity 
compensation, are affected by the claimant's income. As countable 
income goes up, the rate payable goes down. The law does, however, 
provide certain exclusions from countable income.
    38 U.S.C. 1503(a)(3) excludes amounts paid by a surviving spouse or 
child of a deceased veteran for the veteran's just debts from countable 
income; 38 U.S.C. 1315(f)(1)(H) provides a similar exclusion for a 
dependent parent of a deceased veteran who pays a deceased spouse's 
just debts. The term ``just debts,'' however, is not currently defined 
by statute or regulation.
    In a precedent opinion dated August 5, 1993 (OGC Prec 5-93), VA's 
General Counsel held that amounts paid by a surviving spouse on secured 
obligations incurred for the purchase of real or personal property 
could not be excluded as ``just debts'' under 38 U.S.C. 1503(a)(3)(A). 
Based on the principles in OGC Prec 5-93, we have amended 38 CFR 
3.262(m), 3.262(o), and 3.272(h) to state that the term ``just debts'' 
does not include secured debts.
    The Secretary hereby certifies that these regulatory amendments 
will not have a significant economic impact on a substantial number of 
small entities as they are defined in the Regulatory Flexibility Act 
(RFA), 5 U.S.C. 601-612. The reason for this certification is that 
these amendments would not directly affect any small entities. Only VA 
beneficiaries could be directly affected. Therefore, pursuant to 5 
U.S.C. 605(b), these amendments are exempt from the initial and final 
regulatory flexibility analysis requirements of section 603 and 604.
    The Catalog of Federal Domestic Assistance program numbers are 
64.104, 64.105, and 64.110.

List of Subjects in 38 CFR Part 3

    Administrative practice and procedure, Claims, Handicapped, Health 
care, Pensions, Veterans.

    Approved: February 25, 1994.
Jesse Brown,
Secretary of Veterans Affairs.

    For the reasons set forth in the preamble, 38 CFR part 3 is amended 
to read as follows:

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity 
Compensation

    1. The authority citation for part 3, subpart A continues to read 
as follows:

    Authority: 38 U.S.C. 501(a), unless otherwise noted.

    2. In Sec. 3.262, paragraphs (m)(2) and (o)(2) are amended by 
adding new last sentences as follows:


Sec. 3.262  Evaluation of income.

* * * * *
    (m) * * *
    (2) * * * The term ``just debts'' does not include any debt that is 
secured by real or personal property. * * *
* * * * *
    (o) * * *
    (2) * * * The term ``just debts'' does not include any debt that is 
secured by real or personal property. * * *
* * * * *
    3. In Sec. 3.272, paragraph (h)(1)(ii) is amended by adding a new 
last sentence as follows:


Sec. 3.272  Exclusions from income.

* * * * *
    (h) * * *
    (1) * * *
    (ii) * * * The term ``just debts'' does not include any debt that 
is secured by real or personal property. * * *
* * * * *
[FR Doc. 94-16625 Filed 7-8-94; 8:45 am]
BILLING CODE 8320-01-P