If you receive a VA pension, one of the natural questions to ask when preparing an estate plan is:

What happens to my VA pension when I die?

Does your spouse inherit it? Can you leave it to your children? Can you name a beneficiary in your will? Does the VA continue depositing the money into your bank account? What happens to a payment received shortly before or after death?

The answers are important because a VA pension generally does not work like an IRA, 401(k), life insurance policy, or ordinary investment account.

You generally cannot simply name someone to “inherit” your monthly VA pension.

Instead, the veteran’s entitlement generally ends with the veteran’s death. A surviving spouse or qualifying child may potentially be entitled to different VA survivor benefits, but those benefits depend on federal law and eligibility requirements—not on whom the veteran names in a will.

Here’s what veterans and their families should understand.

First: What Do We Mean by a “VA Pension”?

The terminology can be confusing because people sometimes use “VA pension” to describe almost any payment they receive because of military service.

But different benefits have different rules.

The VA Pension program is generally a needs-based benefit for qualifying wartime veterans who meet requirements involving service, age or disability, income, and net worth.

This is different from:

• military retirement pay;
• VA disability compensation;
• Dependency and Indemnity Compensation (DIC);
• Survivor’s Pension;
• Social Security;
• a military Survivor Benefit Plan (SBP); and
• retirement accounts such as the Thrift Savings Plan.

Before doing any estate planning involving “VA benefits,” the first question should therefore be:

Exactly what benefit is the veteran receiving?

The answer determines what happens at death.

Does a Veteran’s VA Pension Continue After Death?

Generally, no.

A veteran’s personal entitlement to VA pension does not simply become an inherited income stream.

This is one of the biggest misconceptions families have.

Suppose a veteran receives $2,000 per month in VA pension benefits and leaves a will saying:

“I leave all of my property to my daughter.”

That does not mean the VA starts sending the veteran’s $2,000 monthly pension payment to the daughter.

Likewise, placing the veteran’s estate into a revocable living trust does not ordinarily turn the veteran’s VA pension into a trust asset that continues being paid after death.

The veteran’s entitlement and a survivor’s potential entitlement are separate questions.

So What Can a Surviving Spouse Receive?

A qualifying surviving spouse may be eligible for VA Survivors Pension, sometimes called a death pension.

This is not simply the deceased veteran’s pension being transferred to the spouse.

It is a separate VA benefit with its own eligibility rules.

Generally, the deceased veteran must have met qualifying wartime-service requirements, and the surviving spouse must satisfy applicable eligibility requirements, including financial limitations.

The amount can depend upon factors such as:

• the survivor’s income;
• applicable net worth rules;
• whether the survivor has dependent children;
• whether the survivor qualifies for Housebound benefits; and
• whether the survivor qualifies for Aid and Attendance.

This distinction is crucial:

Being married to a veteran who received a VA pension does not necessarily mean you automatically continue receiving the same monthly amount after the veteran dies.

The survivor may need to qualify for and apply for a survivor benefit.

What About Aid and Attendance?

This is another area where terminology creates confusion.

People often refer to receiving an “Aid and Attendance pension.”

Aid and Attendance is generally an increased pension amount available to certain veterans or survivors who meet additional requirements.

For example, someone may qualify because he or she needs assistance with activities of daily living, is bedridden, resides in a nursing home because of disability, or meets other applicable criteria.

If a veteran receiving an enhanced pension that includes Aid and Attendance dies, the surviving spouse does not simply inherit that exact enhanced monthly payment.

The surviving spouse may potentially qualify for Survivors Pension with Aid and Attendance, but the survivor must independently satisfy the applicable requirements.

Can Children Receive a VA Survivors Pension?

Potentially—but not every adult child of a veteran qualifies.

VA law uses specific definitions of a qualifying “child.”

Eligibility can potentially include certain unmarried children who are:

• under age 18;
• under age 23 and attending a VA-approved school; or
• unable to support themselves because of a qualifying disability that arose before age 18.

Therefore, an independent 45-year-old son ordinarily does not inherit Dad’s monthly VA pension simply because he is Dad’s beneficiary under the will.

That is a very different system from ordinary inheritance law.

Can You Name a Beneficiary for Your VA Pension?

This is where VA pension differs dramatically from many other assets.

Consider a traditional IRA.

The account owner might name:

Spouse — 100% beneficiary.

When the owner dies, the beneficiary designation governs the retirement account.

A life insurance policy works similarly.

A VA pension generally does not.

You cannot ordinarily turn the veteran’s future monthly pension entitlement into an inheritable asset simply by writing a beneficiary’s name into your will or trust.

Federal benefit law determines who may receive benefits following the veteran’s death.

Your Will Does Not Control VA Survivor Benefits

This is an important estate-planning distinction.

Imagine a veteran’s will says:

“I leave everything equally to my three children.”

The veteran’s bank account, house, personal property, and other assets may ultimately be governed by the will, depending upon how those assets are titled.

But the will does not rewrite federal VA eligibility rules.

Similarly, suppose the veteran’s will leaves everything to a new spouse.

That does not automatically establish the spouse’s entitlement to a particular VA survivor benefit.

Probate law determines who receives probate property. Federal law determines eligibility for VA benefits.

Those systems need to be considered separately.

What Happens to Money Already Deposited Into the Veteran’s Bank Account?

This raises a different question.

There is an important distinction between:

future VA benefits, and

money that has already been properly paid to the veteran.

Once funds have been validly received and become part of the veteran’s assets, their ultimate disposition may depend upon the ownership of the account and applicable estate law.

For example, money sitting in a solely owned bank account may ultimately become part of the estate.

Money in a jointly owned account may be governed by the account’s ownership structure.

A POD account may pass according to its beneficiary designation.

But families should be cautious about VA deposits arriving around the time of death.

Be Careful With Payments Received After Death

When a VA beneficiary dies, the family should notify the VA promptly.

Do not assume that because a payment appeared in the bank account after death, the family is automatically entitled to keep it.

Depending upon the payment period and circumstances, a payment may have to be returned or adjusted.

Families should avoid immediately spending VA deposits received after the beneficiary’s death until entitlement has been confirmed.

This is especially important when automatic deposits continue temporarily because the VA has not yet processed notice of the death.

What Are “Accrued Benefits”?

There is another category families should know about: accrued benefits.

Sometimes the VA owed the veteran money before death that had not yet been paid.

For example, the veteran might have had a pending claim or otherwise been entitled to benefits that remained unpaid at death.

Federal law provides rules governing certain benefits that were due and unpaid.

Eligible survivors may potentially claim those amounts.

This is very different from inheriting the veteran’s future monthly pension.

Think of it this way:

Future pension payments: generally end because the veteran died.

Certain money already due but unpaid: may potentially be payable as accrued benefits to an eligible person.

The order of who may qualify and the applicable filing requirements are governed by federal law.

What If the Veteran Dies While a VA Claim Is Pending?

Death does not necessarily mean every pending VA matter simply disappears.

In certain circumstances, an eligible person may request substitution to continue a pending claim or appeal.

This can be extremely important.

Suppose a veteran had been pursuing a claim that could result in substantial retroactive benefits but dies before the VA makes its final decision.

The family should not simply assume the claim is over.

There may be deadlines for an eligible survivor to request substitution or pursue accrued benefits.

Prompt legal advice can be particularly important in this situation.

Survivors Pension Is Not the Same as DIC

Another frequent source of confusion involves Dependency and Indemnity Compensation, commonly called DIC.

DIC and Survivors Pension are different VA programs.

Generally speaking, DIC may be available to certain survivors when the veteran’s death was connected to military service or other statutory circumstances are satisfied.

Survivors Pension, by contrast, is generally a needs-based benefit associated with qualifying wartime service.

The programs have different:

• eligibility requirements;
• financial rules;
• benefit calculations; and
• underlying purposes.

A surviving spouse should therefore determine all VA survivor benefits for which he or she may qualify, rather than simply asking whether the deceased veteran’s pension continues.

What About Military Retirement?

Military retirement is another completely different issue.

If someone retired from the military and receives military retired pay, survivor planning may involve the Survivor Benefit Plan (SBP).

SBP can provide continuing income to an eligible beneficiary following a retired service member’s death if the appropriate coverage was elected.

That is fundamentally different from VA Pension.

So when a client says:

“I get a military pension,”

the estate-planning attorney should determine whether the client actually means:

• VA Pension;
• VA disability compensation;
• military retired pay;
• SBP;
• another federal benefit; or
• some combination of these.

Using the wrong terminology can produce the wrong estate-planning advice.

Can a Trust Receive the Veteran’s VA Pension After Death?

A revocable living trust can be extremely useful for many assets.

But it does not generally allow a veteran to circumvent VA survivor-benefit rules.

A veteran cannot ordinarily say:

“After I die, send my VA pension to my trust for the next 20 years.”

The underlying entitlement belongs to the veteran and is governed by federal law.

The trust can own assets the veteran accumulated during life, but it does not transform the veteran’s personal VA pension entitlement into a perpetual income stream.

Trust planning may still be relevant for the veteran’s overall estate, particularly where there is a spouse with special needs, minor beneficiaries, asset-management concerns, or significant assets.

It just needs to be distinguished from VA benefit eligibility.

Example: Married Veteran Receiving VA Pension

Consider Tom and Linda.

Tom receives a VA Pension and an additional amount based upon his need for Aid and Attendance.

Tom’s will leaves everything to Linda.

Tom dies.

Linda should not simply assume that Tom’s VA deposit will continue every month.

Instead, several things need to happen.

The VA should be notified of Tom’s death.

Payments received around or after his death should be reviewed before being spent.

Linda should determine whether she qualifies for VA Survivors Pension.

If Linda requires assistance with daily activities or otherwise satisfies the applicable requirements, she should also investigate Aid and Attendance as a surviving spouse.

She should determine whether DIC or any other survivor benefit may apply.

Finally, Tom’s ordinary assets should be administered according to their titles, beneficiary designations, trust documents, and will.

That is a much more complete analysis than simply asking, “Who inherits Tom’s pension?”

Example: Veteran Leaves Everything to an Adult Child

Now suppose Tom is widowed and has one 40-year-old daughter.

His will leaves everything to her.

Tom receives VA Pension until his death.

His daughter can inherit assets that pass to her under Tom’s estate plan.

But she does not automatically inherit Dad’s right to continue receiving VA Pension merely because she is his only child and sole beneficiary.

Whether she could receive any VA payment following his death would depend upon the particular federal survivor or accrued-benefit rules—not simply Tom’s will.

This is why a VA pension should generally not be counted as an inheritable asset producing continuing income for adult children.

Estate Planning for Someone Receiving VA Pension

A veteran receiving VA Pension should still have a complete estate plan.

That may include:

• A will.
• A durable financial power of attorney.
• Health care documents.
• Appropriate beneficiary designations.
• Review of bank-account ownership.
• Review of real-estate ownership.
• A revocable or other trust when appropriate.
• Identification of all VA and military benefits.
• Records showing exactly which benefits the veteran receives.
• Information allowing family members to notify the appropriate agencies after death.
• A review of potential survivor benefits for a spouse or dependent child.

There is another practical reason for keeping good records.

After a death, family members frequently know that Mom or Dad received “something from the VA” but have no idea exactly what it was.

That makes determining survivor rights much harder.

Keeping the VA award information with the estate-planning records can save the family considerable confusion.

Don’t Assume Your Spouse Will Automatically Receive What You Receive

Perhaps the most important takeaway is this:

VA survivor benefits are not simply inherited.

A surviving spouse may be eligible for substantial benefits, but eligibility needs to be evaluated separately.

The surviving spouse should investigate, as applicable:

• Survivors Pension;
• Aid and Attendance;
• Housebound benefits;
• DIC;
• accrued benefits;
• substitution in a pending VA claim;
• burial benefits; and
• military survivor benefits such as SBP.

The answer may be better—or worse—than simply continuing the veteran’s existing monthly payment.

But it requires an actual survivor-benefits analysis.

The Bottom Line

A VA Pension generally should not be treated like an IRA or life insurance policy when preparing an estate plan.

You ordinarily cannot name someone in your will and thereby give that person your future monthly VA pension payments.

The veteran’s entitlement generally ends at death. A qualifying surviving spouse or child may instead be eligible for separate VA survivor benefits under federal law.

Money properly received during the veteran’s lifetime may become part of the veteran’s ordinary assets. Certain benefits that were due but unpaid at death may potentially be recoverable under the VA’s accrued-benefit rules. And if a VA claim was pending when the veteran died, an eligible survivor should investigate substitution promptly.

For estate-planning purposes, the better question therefore isn’t:

“Who inherits my VA pension?”

It is:

“What happens to each of my VA and military benefits when I die, and what does my family need to do to claim every survivor benefit for which they qualify?”

That question should be answered before a crisis occurs.

A good estate plan coordinates the veteran’s will, trust, beneficiary designations, property ownership, and financial accounts with the completely separate federal rules governing VA benefits.

Because serving your country may create benefits for you during your lifetime—but protecting your family means understanding exactly which of those benefits can continue after you’re gone.

This article is for general educational purposes only and does not constitute legal advice or advice regarding eligibility for VA benefits. VA Pension, Survivors Pension, DIC, Aid and Attendance, accrued benefits, military retirement, and the Survivor Benefit Plan are separate programs with different eligibility requirements. Benefit amounts, income and net-worth limits, definitions, and filing requirements can change. Veterans and survivors should confirm current requirements with the U.S. Department of Veterans Affairs or a qualified accredited representative.