[Title 38 CFR ]
[Code of Federal Regulations (annual edition) - July 1, 2008 Edition]
[From the U.S. Government Printing Office]



[[Page i]]

          

          38


          Parts 0 to 17

                         Revised as of July 1, 2008


          Pensions, Bonuses, and Veterans' Relief
          



________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of July 1, 2008
          With Ancillaries
                    Published by
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register

[[Page ii]]

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[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 38:
          Chapter I--Department of Veterans Affairs                  3
  Finding Aids:
      Material Approved for Incorporation by Reference........     773
      Table of CFR Titles and Chapters........................     775
      Alphabetical List of Agencies Appearing in the CFR......     795
      List of CFR Sections Affected...........................     805

[[Page iv]]





                     ----------------------------

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 38 CFR 0.735-1 
                       refers to title 38, part 
                       0, section 735-1.

                     ----------------------------

[[Page v]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, July 1, 2008), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
requirement to publish regulations in the Federal Register by referring 
to materials already published elsewhere. For an incorporation to be 
valid, the Director of the Federal Register must approve it. The legal 
effect of incorporation by reference is that the material is treated as 
if it were published in full in the Federal Register (5 U.S.C. 552(a)). 
This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
containing that incorporation. If, after contacting the agency, you find 
the material is not available, please notify the Director of the Federal 
Register, National Archives and Records Administration, Washington DC 
20408, or call 202-741-6010.

CFR INDEXES AND TABULAR GUIDES

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separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I). A list of CFR titles, chapters, 
and parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

[[Page vii]]


REPUBLICATION OF MATERIAL

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in the Code of Federal Regulations.

INQUIRIES

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or write to the Director, Office of the Federal Register, National 
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ELECTRONIC SERVICES

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register. The NARA site also contains links to GPO Access.

    Raymond A. Mosley,
    Director,
    Office of the Federal Register.
    July 1, 2008.







[[Page ix]]



                               THIS TITLE

    Title 38--Pensions, Bonuses and Veterans' Relief is composed of two 
volumes, parts 0-17 and part 18 to End. The contents of these volumes 
represent all current regulations of the Department of Veterans Affairs 
codified under this title of the CFR as of July 1, 2008.

    For this volume, Michele Bugenhagen was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Michael L. White, assisted by Ann Worley.


[[Page 1]]



            TITLE 38--PENSIONS, BONUSES, AND VETERANS' RELIEF




                   (This book contains parts 0 to 17)

  --------------------------------------------------------------------
                                                                    Part

chapter i--Department of Veterans Affairs...................           3

[[Page 3]]



                CHAPTER I--DEPARTMENT OF VETERANS AFFAIRS




  --------------------------------------------------------------------


  Editorial Note: Nomenclature changes to chapter I appear at 64 FR 
30244, June 7, 1999; 66 FR 44053, Aug. 22, 2001; and 66 FR 66767, Dec. 
27, 2001.
Part                                                                Page
0               Standards of ethical conduct and related 
                    responsibilities........................           5
1               General provisions..........................           6
2               Delegations of authority....................         126
3               Adjudication................................         134
4               Schedule for rating disabilities............         362
5

[Reserved]

6               United States Government life insurance.....         483
7               Soldiers' and sailors' civil relief.........         489
8               National Service Life Insurance.............         491
8a              Veterans Mortgage Life Insurance............         509
9               Servicemembers' Group Life Insurance and 
                    Veterans' Group Life Insurance..........         512
10              Adjusted compensation.......................         526
11              Loans by banks on and payment of adjusted 
                    service certificates....................         533
12              Disposition of veteran's personal funds and 
                    effects.................................         540
13              Veterans Benefits Administration, fiduciary 
                    activities..............................         551
14              Legal services, General Counsel, and 
                    miscellaneous claims....................         559
15              Enforcement of nondiscrimination on the 
                    basis of handicap in programs or 
                    activities conducted by the Department 
                    of Veterans Affairs.....................         608
16              Protection of human subjects................         614
17              Medical.....................................         625

[[Page 5]]



PART 0_STANDARDS OF ETHICAL CONDUCT AND RELATED RESPONSIBILITIES--Table of Contents




                      Subpart A_General Provisions

Sec.
0.735-1 Agency ethics officials.
0.735-2 Government-wide standards.

 Subpart B_Standards of Ethical Conduct and Related Responsibilities of 
                                Employees

0.735-10 Cross-reference to employee ethical and other conduct standards 
          and financial disclosure regulations.
0.735-11 Other conduct on the job.
0.735-12 Standards of conduct in special areas.

    Authority: 5 U.S.C. 301; 38 U.S.C. 501; see sections 201, 301, and 
502(a) of E.O. 12674, 54 FR 15159, 3 CFR, 1989 Comp., p. 215 as modified 
by E.O. 12731, 55 FR 42547, 3 CFR, 1990 Comp., p. 306.

    Source: 31 FR 5828, Apr. 15, 1966, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 0 appear at 61 FR 7216, 
Feb. 27, 1996.



                      Subpart A_General Provisions



Sec. 0.735-1  Agency ethics officials.

    (a) Designated Agency Ethics Official (DAEO). The Assistant General 
Counsel (023) is the designated agency ethics official (DAEO) for the 
Department of Veterans Affairs. The Deputy Assistant General Counsel 
(023C) is the alternate DAEO, who is designated to act in the DAEO's 
absence. The DAEO has primary responsibility for the administration, 
coordination, and management of the VA ethics program, pursuant to 5 CFR 
2638.201-204.
    (b) Deputy ethics officials. (1) The Regional Counsel are deputy 
ethics officials. They have been delegated the authority to act for the 
DAEO within their jurisdiction, under the DAEO's supervision, pursuant 
to 5 CFR 2638.204.
    (2) The alternate DAEO, the DAEO's staff, and staff in the Offices 
of Regional Counsel, may also act as deputy ethics officials pursuant to 
delegations of one or more of the DAEO's duties from the DAEO or the 
Regional Counsel.

[58 FR 61813, Nov. 23, 1993. Redesignated at 61 FR 11309, Mar. 20, 1996]



Sec. 0.735-2  Government-wide standards.

    For government-wide standards of ethical conduct and related 
responsibilities for Federal employees, see 5 CFR Part 735 and Chapter 
XVI.

[61 FR 11309, Mar. 20, 1996. Redesignated at 63 FR 33579, June 19, 1998]



 Subpart B_Standards of Ethical Conduct and Related Responsibilities of 
                                Employees

    Source: 58 FR 61814, Nov. 23, 1993, unless otherwise noted.



Sec. 0.735-10  Cross-reference to employee ethical and other conduct standards and financial disclosure regulations.

    Employees of the Department of Veterans Affairs (VA) should refer to 
the executive branch-wide Standards of Ethical Conduct at 5 CFR part 
2635, the executive branch-wide Employee Responsibilities and Conduct at 
5 CFR part 735, and the executive branch-wide financial disclosure 
regulation at 5 CFR part 2634.



Sec. 0.735-11  Other conduct on the job.

    Relationship with beneficiaries and claimants. Employees are 
expected to be helpful to beneficiaries, patients and claimants, but:
    (a) An employee shall not procure intoxicants or drugs for, or 
attempt to sell intoxicants or drugs to, patients or members, or give or 
attempt to give intoxicants or drugs to them unless officially 
prescribed for medical use;
    (b) An employee shall not abuse patients, members, or other 
beneficiaries, whether or not provoked.



Sec. 0.735-12  Standards of conduct in special areas.

    (a) Safety. (1) Employees will observe safety instructions, signs, 
and normal safety practices and precautions, including the use of 
protective clothing and equipment.
    (2) An employee shall report each work-connected injury, accident or 
disease he or she suffers.
    (b) Furnishing testimony. Employees will furnish information and 
testify freely and honestly in cases respecting employment and 
disciplinary matters.

[[Page 6]]

Refusal to testify, concealment of material facts, or willfully 
inaccurate testimony in connection with an investigation or hearing may 
be ground for disciplinary action. An employee, however, will not be 
required to give testimony against himself or herself in any matter in 
which there is indication that he or she may be or is involved in a 
violation of law wherein there is a possibility of self-incrimination.



PART 1_GENERAL PROVISIONS--Table of Contents




  Department of Veterans Affairs Official Seal and Distinguishing Flag

Sec.
1.9 Description, use, and display of VA seal and flag.

               The United States Flag for Burial Purposes

1.10 Eligibility for and disposition of the United States flag for 
          burial purposes.

     Quarters for Department of Veterans Affairs Employees Overseas

1.11 Quarters for Department of Veterans Affairs employees in 
          Government-owned or -rented buildings overseas.

                           Program Evaluation

1.15 Standards for program evaluation.
1.17 Evaluation of studies relating to health effects of dioxin and 
          radiation exposure.
1.18 Guidelines for establishing presumptions of service connection for 
          former prisoners of war.

         Referrals of Information Regarding Criminal Violations

1.200 Purpose.
1.201 Employee's duty to report.
1.203 Information to be reported to VA Police.
1.204 Information to be reported to the Office of Inspector General.
1.205 Notification to the Attorney General or United States Attorney's 
          Office.

     Security and Law Enforcement at Department of Veterans Affairs 
                               Facilities

1.218 Security and law enforcement at VA facilities.

                  Parking Fees at VA Medical Facilities

1.300 Purpose.
1.301 Definitions.
1.302 Applicability and scope.
1.303 Policy.

Release of Information from Department of Veterans Affairs (VA) Records 
Relating to Drug Abuse, Alcoholism or Alcohol Abuse, Infection With the 
        Human Immunodeficiency Virus (HIV), or Sickle Cell Anemia

1.460 Definitions.
1.461 Applicability.
1.462 Confidentiality restrictions.
1.463 Criminal penalty for violations.
1.464 Minor patients.
1.465 Incompetent and deceased patients.
1.466 Security for records.
1.467 Restrictions on the use of identification cards and public signs.
1.468 Relationship to Federal statutes protecting research subjects 
          against compulsory disclosure of their identity.
1.469 Patient access and restrictions on use.
1.470-1.474 [Reserved]

                   Disclosures With Patient's Consent

1.475 Form of written consent.
1.476 Prohibition on redisclosure.
1.477 Disclosures permitted with written consent.
1.478 Disclosures to prevent multiple enrollments in detoxification and 
          maintenance treatment programs; not applicable to records 
          relating to sickle cell anemia or infection with the human 
          immunodeficiency virus.
1.479 Disclosures to elements of the criminal justice system which have 
          referred patients.
1.480-1.484 [Reserved]

                   Disclosures Without Patient Consent

1.485 Medical emergencies.
1.485a Eye, organ and tissue donation.
1.486 Disclosure of information related to infection with the human 
          immunodeficiency virus to public health authorities.
1.487 Disclosure of information related to infection with the human 
          immunodeficiency virus to the spouse or sexual partner of the 
          patient.
1.488 Research activities.
1.489 Audit and evaluation activities.

              Court Orders Authorizing Disclosures and Use

1.490 Legal effect of order.
1.491 Confidential communications.
1.492 Order not applicable to records disclosed without consent to 
          researchers, auditors and evaluators.
1.493 Procedures and criteria for orders authorizing disclosures for 
          noncriminal purposes.
1.494 Procedures and criteria for orders authorizing disclosure and use 
          of records to criminally investigate or prosecute patients.

[[Page 7]]

1.495 Procedures and criteria for orders authorizing disclosure and use 
          of records to investigate or prosecute VA or employees of VA.
1.496 Orders authorizing the use of undercover agents and informants to 
          criminally investigate employees or agents of VA.
1.497-1.499 [Reserved]

  Release of Information From Department of Veterans Affairs Claimant 
                                 Records

1.500 General.
1.501 Release of information by the Secretary.
1.502 Disclosure of the amount of monetary benefits.
1.503 Disclosure of information to a veteran or his or her duly 
          authorized representative as to matters concerning the veteran 
          alone.
1.504 Disclosure of information to a widow, child, or other claimant.
1.505 Genealogy.
1.506 Disclosure of records to Federal Government departments, State 
          unemployment compensation agencies, and the Office of 
          Servicemembers' Group Life Insurance.
1.507 Disclosures to members of Congress.
1.508 Disclosure in cases where claimants are charged with or convicted 
          of criminal offenses.
1.509 Disclosure to courts in proceedings in the nature of an inquest.
1.510 Disclosure to insurance companies cooperating with the Department 
          of Justice in the defense of insurance suits against the 
          United States.
1.511 Disclosure of claimant records in connection with judicial 
          proceedings generally.
1.512 Disclosure of loan guaranty information.
1.513 Disclosure of information contained in Armed Forces service and 
          related medical records in Department of Veterans Affairs 
          custody.
1.514 Disclosure to private physicians and hospitals other than 
          Department of Veterans Affairs.
1.514a Disclosure to private psychologists.
1.514b Disclosures to procurement organizations.
1.515 To commanding officers of State soldiers' homes.
1.516 Disclosure of information to undertaker concerning burial of a 
          deceased veteran.
1.517 Disclosure of vocational rehabilitation and education information 
          to educational institutions cooperating with the Department of 
          Veterans Affairs.
1.518 Addresses of claimants.
1.519 Lists of names and addresses.
1.520 Confidentiality of social data.
1.521 Special restrictions concerning social security records.
1.522 Determination of the question as to whether disclosure will be 
          prejudicial to the mental or physical health of claimant.
1.523 [Reserved]
1.524 Persons authorized to represent claimants.
1.525 Inspection of records by or disclosure of information to 
          recognized representatives of organizations and recognized 
          attorneys.
1.526 Copies of records and papers.
1.527 Administrative review.

Release of Information From Department of Veterans Affairs Records Other 
                          Than Claimant Records

1.550 General.
1.551 [Reserved]
1.552 Public access to information that affects the public when not 
          published in the Federal Register as constructive notice.
1.553 Public access to other reasonably described records.
1.553a Time limits for Department of Veterans Affairs response to 
          requests for records.
1.554 Exemptions from public access to agency records.
1.554a Predisclosure notification procedures for confidential commercial 
          information.
1.555 Fees.
1.556 Requests for other reasonably described records.
1.557 Administrative review.
1.558-1.559 [Reserved]

  Safeguarding Personal Information in Department of Veterans Affairs 
                                 Records

1.575 Social security numbers in veterans' benefits matters.
1.576 General policies, conditions of disclosure, accounting of certain 
          disclosures, and definitions.
1.577 Access to records.
1.578 [Reserved]
1.579 Amendment of records.
1.580 Administrative review.
1.581 [Reserved]
1.582 Exemptions.
1.583-1.584 [Reserved]

   Expanded Remote Access to Computerized Veterans Claims Records by 
                       Accredited Representatives

1.600 Purpose.
1.601 Qualifications for access.
1.602 Utilization of access.
1.603 Disqualification.

        Inventions by Employees of Department of Veterans Affairs

1.650 Purpose.

[[Page 8]]

1.651 Definitions.
1.652 Criteria for determining rights to employee inventions.
1.653 Delegation of authority.
1.654 Patenting of inventions.
1.655 Government license in invention of employee.
1.656 Information to be submitted by inventor.
1.657 Determination of rights.
1.658 Right of appeal.
1.659 Relationship to incentive awards program.
1.660 Expeditious handling.
1.661 Information to be kept confidential.
1.662 Provisions of regulations made a condition of employment.
1.663 Licensing of Government-owned inventions.
1.664-1.666 [Reserved]

                     Administrative Control of Funds

1.670 Purpose.
1.671 Definitions.
1.672 Responsibilities.
1.673 Responsibility for violations of the administrative subdivision of 
          funds.

  Use of Official Mail in the Location and Recovery of Missing Children

1.700 Purpose.
1.701 Contact person for missing children official mail program.
1.702 Policy.
1.703 Percentage estimate.
1.704 [Reserved]
1.705 Restrictions on use of missing children information.

                           Homeless Claimants

1.710 Homeless claimants: Delivery of benefit payments and 
          correspondence.
1.780-1.783 [Reserved]

                   Part-Time Career Employment Program

1.891 Purpose of program.
1.892 Review of positions.
1.893 Establishing and converting part-time positions.
1.894 Annual goals and timetables.
1.895 Review and evaluation.
1.896 Publicizing vacancies.
1.897 Exceptions.

   Standards for Collection, Compromise, Suspension or Termination of 
  Collection Effort, and Referral of Civil Claims for Money or Property

1.900 Prescription of standards.
1.901 No private rights created.
1.902 Antitrust, fraud, and tax interagency claims.
1.903 Settlement, waiver, or compromise under other statutory or 
          regulatory authority.
1.904 Form of payment.
1.905 Subdivision of claims not authorized.
1.906 Required administrative proceedings.
1.907 Definitions.

                   Standards for Collection of Claims

1.910 Aggressive collection action.
1.911 Collection of debts owed by reason of participation in a benefits 
          program.
1.911a Collection of non-benefit debts.
1.912 Collection by offset.
1.912a Collection by offset--from VA benefit payments.
1.913 Liquidation of collateral.
1.914 Collection in installments.
1.915 Interest, administrative costs, and penalties.
1.916 Disclosure of debt information to consumer reporting agencies 
          (CRA).
1.917 Contracting for collection services.
1.918 Use and disclosure of mailing addresses.
1.919 Administrative offset against amounts payable from Civil Service 
          Retirement and Disability Fund, Federal Employees Retirement 
          System (FERS), final salary check, and lump sum leave 
          payments.
1.920 Referral of VA debts.
1.921 Analysis of costs.
1.922 Exemptions.
1.923 Administrative wage garnishment.
1.924 Suspension or revocation of eligibility for federal loans, loan 
          insurance, loan guarantees, licenses, permits, or privileges.

                   Standards for Compromise of Claims

1.930 Scope and application.
1.931 Bases for compromise.
1.932 Enforcement policy.
1.933 Joint and several liability.
1.934 Further review of compromise offers.
1.935 Consideration of tax consequences to the Government.
1.936 Mutual releases of the debtor and VA.

        Standards for Suspending or Terminating Collection Action

1.940 Scope and application.
1.941 Suspension of collection activity.
1.942 Termination of collection activity.
1.943 Exception to termination.
1.944 Discharge of indebtedness; reporting requirements.

             Referrals to GAO, Department of Justice, or IRS

1.950 Prompt referral.
1.951 Claims Collection Litigation Report (CCLR).
1.952 Preservation of evidence.
1.953 Minimum amount of referrals to the Department of Justice.

[[Page 9]]

          Regional Office Committees on Waivers and Compromises

1.955 Regional office Committees on Waivers and Compromises.
1.956 Jurisdiction.
1.957 Committee authority.
1.958 Finality of decisions.
1.959 Records and certificates.
1.960 Legal and technical assistance.
1.961 Releases.
1.962 Waiver of overpayments.
1.963 Waiver; other than loan guaranty.
1.963a Waiver; erroneous payments of pay and allowances.
1.964 Waiver; loan guaranty.
1.965 Application of standard.
1.966 Scope of waiver decisions.
1.967 Refunds.
1.968 [Reserved]
1.969 Revision of waiver decisions.
1.970 Standards for compromise.

                        Salary Offset Provisions

1.980 Scope.
1.981 Definitions.
1.982 Salary offsets of debts involving benefits under the laws 
          administered by VA.
1.983 Notice requirements before salary offsets of debts not involving 
          benefits under the laws administered by VA.
1.984 Request for a hearing.
1.985 Form, notice of, and conduct of hearing.
1.986 Result if employee fails to meet deadlines.
1.987 Review by hearing official or administrative law judge.
1.988 Written decision following a hearing requested under Sec. 1.984.
1.989 Review of VA records related to the debt.
1.990 Written agreement to repay debt as alternative to salary offset.
1.991 Procedures for salary offset: when deductions may begin.
1.992 Procedures for salary offset.
1.993 Non-waiver of rights.
1.994 Refunds.
1.995 Requesting recovery through centralized administrative offset.

    Authority: 38 U.S.C. 501(a), and as noted in specific sections.

    Editorial Note: Nomenclature changes to part 1 appear at 61 FR 7216, 
Feb. 27, 1996; 62 FR 35970, July 3, 1997; and 62 FR 47532, Sept. 9, 
1997.

  Department of Veterans Affairs Official Seal and Distinguishing Flag



Sec. 1.9  Description, use, and display of VA seal and flag.

    (a) General. This section describes the official seal and 
distinguishing flag of the of the Department of Veterans Affairs, and 
prescribes the rules for their custody and use.
    (b) Definitions. (1) VA means all organizational units of the 
Department of Veterans Affairs.
    (2) Embossed seal means an image of the official seal made on paper 
or other medium by using an embosser with a negative and positive die to 
create a raised impression.
    (3) Official seal means the original(s) of the VA seal showing the 
exact form, content, and colors thereof.
    (4) Replica means a copy of the official seal displaying the 
identical form, content, and colors thereof.
    (5) Reproduction means a copy of the official seal displaying the 
identical form and content, reproduced in only one color.
    (6) Secretary means the Secretary of Veterans Affairs.
    (7) Deputy Secretary means the Deputy Secretary of Veterans Affairs.
    (c) Custody of official seal and distinguishing flags. The Secretary 
or designee shall:
    (1) Have custody of:
    (i) The official seal and prototypes thereof, and masters, molds, 
dies, and other means of producing replicas, reproductions, and 
embossing seals and
    (ii) Production, inventory, and loan records relating to items 
specified in paragraph (c)(1)(i) of this section, and
    (2) Have custody of distinguishing flags, and be responsible for 
production, inventory, and loan records thereof.
    (d) Official Seal--(1) Description of official seal. The Department 
of Veterans Affairs prescribes as its official seal, of which judicial 
notice shall be taken pursuant to 38 U.S.C. 302, the imprint illustrated 
below:

[[Page 10]]

[GRAPHIC] [TIFF OMITTED] TC04NO91.000

    (i) The official seal includes an American eagle clutching a cord in 
its talons. The cord binds a 13-star U.S. flag and a 50-star U.S. flag. 
In the field over the eagle is a pentagon formation of stars, with one 
point down. The words Department of Veterans Affairs and United States 
of America surround the eagle, stars, and flags. A rope motif makes up 
the outermost ring of the seal.
    (ii) The eagle represents the eternal vigilance of all our nation's 
veterans. The stars represent the five branches of military service. The 
crossed flags represent our nation's history. The gold cord that binds 
the two flags, which is shown clutched in the eagle's talons is symbolic 
of those who have fallen in the defense of liberty. Each of the various 
individual items placed together in the seal is a salute to the past, 
present, and future.
    (iii) The colors used in the configuration are gold, brown, blue, 
white, silver, yellow, black, and red.
    (iv) The colors are derived from the American flag and from nature. 
By invoking this symbolism, the color scheme represents the Nation's 
commitment to its veterans.
    (2) Use of the official seal, replicas, reproductions, and embossing 
seals. (i) The Secretary or designees are authorized to affix replicas, 
reproductions, and embossed seals to appropriate documents, 
certifications, and other material for all purposes as authorized by 
this section.
    (ii) Replicas may be used only for:
    (A) Display in or adjacent to VA facilities, in Department 
auditoriums, presentation rooms, hearing rooms, lobbies, and public 
document rooms.
    (B) Offices of senior officials.
    (C) Official VA distinguishing flags, adopted and utilized pursuant 
to paragraph (e)(2) of this section.
    (D) Official awards, certificates, medals, and plaques.
    (E) Motion picture film, video tape, and other audiovisual media 
prepared by or for VA and attributed thereto.
    (F) Official prestige publications which represent the achievements 
or mission of VA.
    (G) For other similar official purposes.
    (H) For such other purposes as will tend to advance the aims, 
purposes and mission of the Department of Veterans Affairs as determined 
by the Secretary or Deputy Secretary.
    (iii) Reproductions may be used only on:
    (A) VA letterhead stationery.
    (B) Official VA identification cards and security credentials.
    (C) Business cards for VA employees.
    (D) Official VA signs.
    (E) Official publications or graphics issued by and attributed to 
VA, or joint statements of VA with one or more Federal agencies, State 
or local governments, or foreign governments.
    (F) Official awards, certificates, and medals.
    (G) Motion picture film, video tape, and other audiovisual media 
prepared by and for VA and attributed thereto.
    (H) For other similar official purposes.
    (I) For such other purposes as will tend to advance the aims, 
purposes and mission of the Department of Veterans Affairs as determined 
by the Secretary or Deputy Secretary.
    (iv) Use of the official seal and embossed seals:
    (A) Embossed seals may be used only on VA legal documents, including 
interagency or intergovernmental agreements with States, foreign patent 
applications, and similar official documents.
    (B) The official seal may be used only for those purposes related to 
the conduct of Departmental affairs in furtherance of the VA mission.

[[Page 11]]

    (e) Distinguishing flag. (1) Description of distinguishing flag.
    (i) The base or field of the flag shall be blue and a replica of the 
official seal shall appear on both sides thereof.
    (ii) A Class 1 flag shall be of nylon banner, measure 
4[foot]4 on the hoist by 5[foot]6 on the fly, 
exclusive of heading and hems, and be fringed on three edges with nylon 
fringe, 2\1/2\ wide.
    (iii) A Class 2 flag shall be of nylon banner, measure 3[foot] on 
the hoist by 5[foot] on the fly, exclusive of heading and hems, and be 
fringed on three edges with nylon fringe, 2\1/2\ wide.
    (iv) Each flag shall be manufactured in accordance with Department 
of Veterans Affairs Specification X-497G. The replica of the official 
seal shall be screen printed or embroidered on both sides.
    (2) Use of distinguishing flag. (i) VA distinguishing flags may be 
used only:
    (A) In the offices of the Secretary, Deputy Secretary, Assistant 
Secretaries, Deputy Assistant Secretaries and heads of field locations 
designated below:
    (1) Regional Offices.
    (2) Medical Centers and Outpatient Clinics.
    (3) Domiciliaries.
    (4) Marketing Centers and Supply Depots.
    (5) Data Processing Centers.
    (6) National Cemetery Offices.
    (7) Other locations as designated by the Deputy Assistant Secretary 
for Administration.
    (B) At official VA ceremonies.
    (C) In Department auditoriums, official presentation rooms, hearing 
rooms, lobbies, public document rooms, and in non-VA facilities in 
connection with events or displays sponsored by VA, and public 
appearances of VA officials.
    (D) On or in front of VA installation buildings.
    (E) Other such official VA purposes or purposes as will tend to 
advance the aims, purposes and mission of the Department of Veterans 
Affairs as determined by the Deputy Assistant Secretary for 
Administration.
    (f) Unauthorized uses of the seal and flag. (1) The official seal, 
replicas, reproductions, embossed seals, and the distinguished flag 
shall not be used, except as authorized by the Secretary or Deputy 
Secretary, in connection with:
    (i) Contractor-operated facilities.
    (ii) Souvenir or novelty items.
    (iii) Toys or commercial gifts or premiums.
    (iv) Letterhead design, except on official Departmental stationery.
    (v) Matchbook covers, calendars and similar items.
    (vi) Civilian clothing or equipment.
    (vii) Any article which may disparage the seal or flag or reflect 
unfavorably upon VA.
    (viii) Any manner which implies Departmental endorsement of 
commercial products or services, or of the commercial user's policies or 
activities.
    (2) Penalties for unauthorized use. Any person who uses the 
distinguishing flag, or the official seal, replicas, reproductions or 
embossed seals in a manner inconsistent with this section shall be 
subject to the penalty provisions of 18 U.S.C. 506, 701, or 1017, 
providing penalties for their wrongful use, as applicable.

(Authority: 38 U.S.C. 302, 38 U.S.C. 501)

[55 FR 49518, Nov. 29, 1990]

               The United States Flag for Burial Purposes



Sec. 1.10  Eligibility for and disposition of the United States flag for burial purposes.

    (a) Eligibility for burial flags--(1) Persons eligible. (i) A 
veteran of any war, of Mexican border service, or of service after 
January 31, 1955, discharged or released from active duty under 
conditions other than dishonorable. (For the purpose of this section, 
the term Mexican border service means active military, naval, or air 
service during the period beginning on January 1, 1911, and ending on 
April 5, 1917, in Mexico, on the borders thereof, or in the waters 
adjacent thereto.)
    (ii) A peacetime veteran discharged or released, before June 27, 
1950, from the active military, naval, or air service, under conditions 
other than dishonorable, after serving at least one enlistment, or for a 
disability incurred or aggravated in line of duty.
    (iii) Any person who has died while in military or naval service of 
the United

[[Page 12]]

States after May 27, 1941. This subdivision authorizes and requires the 
furnishing of a flag only where the military or naval service does not 
furnish a flag immediately. The only cases wherein a flag is not 
supplied immediately are those of persons whose remains are interred 
outside the continental limits of the United States, or whose remains 
are not recovered or are recovered and not identified.
    (iv) Any person who served in the organized military forces of the 
Commonwealth of the Philippines while such forces were in the service of 
the Armed Forces of the United States pursuant to the military order of 
the President of the United States, dated July 26, 1941, including among 
such military forces organized guerrilla forces under commanders 
appointed, designated, or subsequently recognized by the Commander in 
Chief, Southwest Pacific Area, or other competent authority in the Army 
of the United States, and who dies after separation from such service 
under conditions other than dishonorable, on or after April 25, 1951.


(Authority: 38 U.S.C. 107(a))

    (v) Any deceased member or former member of the Selected Reserve (as 
described in section 10143 of title 10) who is not otherwise eligible 
for a flag under this section or section 1482(a) of title 10 and who:
    (A) Completed at least one enlistment as a member of the Selected 
Reserve or, in the case of an officer, completed the period of initial 
obligated service as a member of the Selected Reserve;
    (B) Was discharged before completion of the person's initial 
enlistment as a member of the Selected Reserve or, in the case of an 
officer, period of initial obligated service as a member of the Selected 
Reserve, for a disability incurred or aggravated in the line of duty; or
    (C) Died while a member of the Selected Reserve.


(Authority: 38 U.S.C. 2301(f)(1))

    (b) Disposition of burial flags. (1) When a flag is actually used to 
drape the casket of a deceased veteran, it must be delivered to the next 
of kin following interment. Where the flag is not claimed by the next of 
kin it may be given upon request to a close friend or associate of the 
deceased veteran. Such action will constitute final and conclusive 
determination of rights under this section. (38 U.S.C. 2301)
    (2) The phrase next of kin for the purpose of disposing of the flag 
used for burial purposes is defined as follows, with preference to 
entitlement in the order listed:
    (i) Widow or widower.
    (ii) Children, according to age (minor child may be issued a flag on 
application signed by guardian).
    (iii) Parents, including adoptive, stepparents, and foster parents.
    (iv) Brothers or sisters, including brothers or sisters of the 
halfblood.
    (v) Uncles or aunts.
    (vi) Nephews or nieces.
    (vii) Others--cousins, grandparents, etc. (but not in-laws).
    (3) The phrase close friend or associate for the purpose of 
disposing of the burial flag means any person who because of his or her 
relationship with the deceased veteran arranged for the burial or 
assisted in the burial arrangements. In the absence of a person falling 
in either of these categories, any person who establishes by evidence 
that he or she was a close friend or associate of the veteran may be 
furnished the burial flag. Where more than one request for the burial 
flag is received and each is accompanied by satisfactory evidence of 
relationship or association, the head of the field facility having 
jurisdiction of the burial flag quota will determine which applicant is 
the one most equitably entitled to the burial flag.

(Authority: 72 Stat. 1114, 1169, as amended; 38 U.S.C. 501, 2301)

[13 FR 6999, Nov. 27, 1948, as amended at 20 FR 8350, Nov. 8, 1955; 24 
FR 10106, Dec. 15, 1959; 31 FR 4959, Mar. 26, 1966; 42 FR 27245, May 27, 
1977; 66 FR 27598, May 18, 2001]

[[Page 13]]

     Quarters for Department of Veterans Affairs Employees Overseas



Sec. 1.11  Quarters for Department of Veterans Affairs employees in Government-owned or -rented buildings overseas.

    Pursuant to the provisions of 5 U.S.C. 5912, a U.S. citizen employee 
of the Department of Veterans Affairs permanently stationed in a foreign 
country may be furnished, without cost to him or her, living quarters, 
including heat, fuel, and light, in a Government-owned or -rented 
building. When in the interest of the service and when administratively 
feasible, an agreement may be entered into by the Under Secretary for 
Benefits or designee with another Federal agency, which is authorized to 
furnish quarters, to provide such quarters for Department of Veterans 
Affairs employees under the provisions of 31 U.S.C. 686. Quarters 
provided will be in lieu of any living quarters allowance to which the 
employee may otherwise be entitled.

(Authority: 72 Stat. 1114; 38 U.S.C. 501)

[33 FR 362, Jan. 10, 1968]

                           Program Evaluation



Sec. 1.15  Standards for program evaluation.

    (a) The Department of Veterans Affairs will evaluate all programs 
authorized under title 38 U.S.C. These evaluations will be conducted so 
as to determine each program's effectiveness in achieving its stated 
goals and in achieving such goals in relation to their cost. In 
addition, these evaluations will determine each program's impact on 
related programs and its structure and mechanism for delivery of 
services. All programs will be evaluated on a continuing basis and all 
evaluations will be conducted by Department of Veterans Affairs staff 
assigned to an organizational entity other than those responsible for 
program administration. These evaluations will be conducted with 
sufficient frequency to allow for an assessment of the continued 
effectiveness of the programs.
    (b) The program evaluation will be designed to determine if the 
existing program supports the intent of the law. A program evaluation 
must identify goals and objectives that support this intent, contain a 
method to measure fulfillment of the objectives, ascertain the degree to 
which goals and objectives are met, and report the findings and 
conclusions to Congress, as well as make them available to the public.
    (c) The goals must be clear, specific, and measurable. To be clear 
they must be readily understood, free from doubt or confusion, and 
specific goals must be explicitly set forth. They must be measurable by 
objective means. These means can include use of existing record systems, 
observations, and information from other sources.
    (d) All program evaluations require a detailed evaluation plan. The 
evaluation plan must clearly state the objectives of the program 
evaluation, the methodology to be used, resources to be committed, and a 
timetable of major phases.
    (e) Each program evaluation must be objective. It must report the 
accomplishments as well as the shortcomings of the program in an 
unbiased way. The program evaluation must have findings that give 
decision-makers information which is of a level of detail and importance 
to enable decisions to be made affecting either direction or operation. 
The information in the program evaluation must be timely, and must 
contain information of sufficient currency that decisions based on the 
data in the evaluation can be made with a high degree of confidence in 
the data.
    (f) Each program evaluation requires a systematic research design to 
collect the data necessary to measure the objectives. This research 
design should conform to the following:
    (1) Rationale. The research design for each evaluation should 
contain a specific rationale and should be structured to determine 
possible cause and effect relationships.
    (2) Relevancy. It must deal with issues currently existing within 
the program, within the Department, and within the environment in which 
the program operates.
    (3) Validity. The degree of statistical validity should be assessed 
within the research design. Alternatives include an assessment of cost 
of data collection

[[Page 14]]

vs. results necessary to support decisions.
    (4) Reliability. Use of the same research design by others should 
yield the same findings.
    (g) The final program evaluation report will be reviewed for 
comments and concurrence by relevant organizations within the Department 
of Veterans Affairs, but in no case should this review unreasonably 
delay the results of the evaluation. Where disagreement exists, the 
dissenting organization's position should be summarized for a decision 
by the Secretary.
    (h) The final program evaluation report will be forwarded, with 
approved recommendations, to the concerned organization. An action plan 
to accomplish the approved recommendations will be forwarded for 
evaluation by the evaluating entity.
    (i) Program evaluation results should be integrated to the maximum 
extent possible into Department of Veterans Affairs plans and budget 
submissions to ensure continuity with other Department of Veterans 
Affairs management processes.

(Authority: 38 U.S.C. 527)

[47 FR 53735, Nov. 29, 1982, as amended at 54 FR 34980, Aug. 23, 1989]



Sec. 1.17  Evaluation of studies relating to health effects of dioxin and radiation exposure.

    (a) From time to time, the Secretary shall publish evaluations of 
scientific or medical studies relating to the adverse health effects of 
exposure to an herbicide containing 2, 3, 7, 8 tetrachlorodibenzo-p-
dioxin (dioxin) and/or exposure to ionizing radiation in the ``Notices'' 
section of the Federal Register.
    (b) Factors to be considered in evaluating scientific studies 
include:
    (1) Whether the study's findings are statistically significant and 
replicable.
    (2) Whether the study and its findings have withstood peer review.
    (3) Whether the study methodology has been sufficiently described to 
permit replication of the study.
    (4) Whether the study's findings are applicable to the veteran 
population of interest.
    (5) The views of the appropriate panel of the Scientific Council of 
the Veterans' Advisory Committee on Environmental Hazards.
    (c) When the Secretary determines, based on the evaluation of 
scientific or medical studies and after receiving the advice of the 
Veterans' Advisory Committee on Environmental Hazards and applying the 
reasonable doubt doctrine as set forth in paragraph (d)(1) of this 
section, that a significant statistical association exists between any 
disease and exposure to an herbicide containing dioxin or exposure to 
ionizing radiation, Sec. 3.311a or Sec. 3.311b of this title, as 
appropriate, shall be amended to provide guidelines for the 
establishment of service connection.
    (d)(1) For purposes of paragraph (c) of this section a significant 
statistical association shall be deemed to exist when the relative 
weights of valid positive and negative studies permit the conclusion 
that it is at least as likely as not that the purported relationship 
between a particular type of exposure and a specific adverse health 
effect exists.
    (2) For purposes of this paragraph a valid study is one which:
    (i) Has adequately described the study design and methods of data 
collection, verification and analysis;
    (ii) Is reasonably free of biases, such as selection, observation 
and participation biases; however, if biases exist, the investigator has 
acknowledged them and so stated the study's conclusions that the biases 
do not intrude upon those conclusions; and
    (iii) Has satisfactorily accounted for known confounding factors.
    (3) For purposes of this paragraph a valid positive study is one 
which satisfies the criteria in paragraph (d)(2) of this section and 
whose findings are statistically significant at a probability level of 
.05 or less with proper accounting for multiple comparisons and subgroup 
analyses.
    (4) For purposes of this paragraph a valid negative study is one 
which satisfies the criteria in paragraph (d)(2) of this section and has 
sufficient statistical power to detect an association between a 
particular type of exposure and a specific adverse health effect if such 
an association were to exist.
    (e) For purposes of assessing the relative weights of valid positive 
and negative studies, other studies affecting

[[Page 15]]

epidemiological assessments including case series, correlational studies 
and studies with insufficient statistical power as well as key 
mechanistic and animal studies which are found to have particular 
relevance to an effect on human organ systems may also be considered.
    (f) Notwithstanding the provisions of paragraph (d) of this section, 
a significant statistical association may be deemed to exist between a 
particular exposure and a specific disease if, in the Secretary's 
judgment, scientific and medical evidence on the whole supports such a 
decision.

(Authority: 38 U.S.C. 501; Pub. L. 98-542)

[54 FR 40391, Oct. 2, 1989; 54 FR 46187, Nov. 1, 1989]



Sec. 1.18  Guidelines for establishing presumptions of service connection for former prisoners of war.

    (a) Purpose. The Secretary of Veterans Affairs will establish 
presumptions of service connection for former prisoners of war when 
necessary to prevent denials of benefits in significant numbers of 
meritorious claims.
    (b) Standard. The Secretary may establish a presumption of service 
connection for a disease when the Secretary finds that there is at least 
limited/suggestive evidence that an increased risk of such disease is 
associated with service involving detention or internment as a prisoner 
of war and an association between such detention or internment and the 
disease is biologically plausible.
    (1) Definition. The phrase ``limited/suggestive evidence'' refers to 
evidence of a sound scientific or medical nature that is reasonably 
suggestive of an association between prisoner-of-war experience and the 
disease, even though the evidence may be limited because matters such as 
chance, bias, and confounding could not be ruled out with confidence or 
because the relatively small size of the affected population restricts 
the data available for study.
    (2) Examples. ``Limited/suggestive evidence'' may be found where one 
high-quality study detects a statistically significant association 
between the prisoner-of-war experience and disease, even though other 
studies may be inconclusive. It also may be satisfied where several 
smaller studies detect an association that is consistent in magnitude 
and direction. These examples are not exhaustive.
    (c) Duration of detention or internment. In establishing a 
presumption of service connection under paragraph (b) of this section, 
the Secretary may, based on sound scientific or medical evidence, 
specify a minimum duration of detention or internment necessary for 
application of the presumption.
    (d) Association. The requirement in paragraph (b) of this section 
that an increased risk of disease be ``associated'' with prisoner-of-war 
service may be satisfied by evidence that demonstrates either a 
statistical association or a causal association.
    (e) Evidence. In making determinations under paragraph (b) of this 
section, the Secretary will consider, to the extent feasible:
    (1) Evidence regarding the increased incidence of disease in former 
prisoners of war;
    (2) Evidence regarding the health effects of circumstances or 
hardships similar to those experienced by prisoners of war (such as 
malnutrition, torture, physical abuse, or psychological stress);
    (3) Evidence regarding the duration of exposure to circumstances or 
hardships experienced by prisoners of war that is associated with 
particular health effects; and
    (4) Any other sound scientific or medical evidence the Secretary 
considers relevant.
    (f) Evaluation of studies. In evaluating any study for the purposes 
of this section, the Secretary will consider:
    (1) The degree to which the study's findings are statistically 
significant;
    (2) The degree to which any conclusions drawn from the study data 
have withstood peer review;
    (3) Whether the methodology used to obtain the data can be 
replicated;
    (4) The degree to which the data may be affected by chance, bias, or 
confounding factors; and
    (5) The degree to which the data may be relevant to the experience 
of prisoners of war in view of similarities or differences in the 
circumstances of the study population.

[[Page 16]]

    (g) Contracts for Scientific Review and Analysis. To assist in 
making determinations under this section, the Secretary may contract 
with an appropriate expert body to review and summarize the scientific 
evidence, and assess the strength thereof, concerning the association 
between detention or internment as a prisoner of war and the occurrence 
of any disease, or for any other purpose relevant to the Secretary's 
determinations.

(Authority:
    38 U.S.C. 501(a), 1110)

[69 FR 60089, Oct. 7, 2004]

         Referrals of Information Regarding Criminal Violations



Sec. 1.200  Purpose.

    This subpart establishes a duty upon and sets forth the mechanism 
for VA employees to report information about actual or possible criminal 
violations to appropriate law enforcement entities.

(Authority: 5 U.S.C. App. 3, 38 U.S.C. 902)

[68 FR 17550, Apr. 10, 2003]



Sec. 1.201  Employee's duty to report.

    All VA employees with knowledge or information about actual or 
possible violations of criminal law related to VA programs, operations, 
facilities, contracts, or information technology systems shall 
immediately report such knowledge or information to their supervisor, 
any management official, or directly to the Office of Inspector General.

(Authority: 5 U.S.C. App. 3, 38 U.S.C. 902)

[68 FR 17550, Apr. 10, 2003]



Sec. 1.203  Information to be reported to VA Police.

    Information about actual or possible violations of criminal laws 
related to VA programs, operations, facilities, or involving VA 
employees, where the violation of criminal law occurs on VA premises, 
will be reported by VA management officials to the VA police component 
with responsibility for the VA station or facility in question. If there 
is no VA police component with jurisdiction over the offense, the 
information will be reported to Federal, state or local law enforcement 
officials, as appropriate.

(Authority: 38 U.S.C. 902)

[68 FR 17550, Apr. 10, 2003]



Sec. 1.204  Information to be reported to the Office of Inspector General.

    Criminal matters involving felonies will also be immediately 
referred to the Office of Inspector General, Office of Investigations. 
VA management officials with information about possible criminal matters 
involving felonies will ensure and be responsible for prompt referrals 
to the OIG. Examples of felonies include but are not limited to, theft 
of Government property over $1000, false claims, false statements, drug 
offenses, crimes involving information technology systems and serious 
crimes against the person, i.e., homicides, armed robbery, rape, 
aggravated assault and serious physical abuse of a VA patient.

(Authority: 5 U.S.C. App. 3)

[68 FR 17550, Apr. 10, 2003]



Sec. 1.205  Notification to the Attorney General or United States Attorney's Office.

    VA police and/or the OIG, whichever has primary responsibility 
within VA for investigation of the offense in question, will be 
responsible for notifying the appropriate United States Attorney's 
Office, pursuant to 28 U.S.C. 535.

(Authority: 5 U.S.C. App. 3, 38 U.S.C. 902)

[68 FR 17550, Apr. 10, 2003]

     Security and Law Enforcement at Department of Veterans Affairs 
                               Facilities



Sec. 1.218  Security and law enforcement at VA facilities.

    (a) Authority and rules of conduct. Pursuant to 38 U.S.C. 901, the 
following rules and regulations apply at all property under the charge 
and control of VA (and not under the charge and control of the General 
Services Administration) and to all persons entering in or on such 
property. The head of the facility is charged with the responsibility 
for the enforcement of these rules and regulations and shall cause

[[Page 17]]

these rules and regulations to be posted in a conspicuous place on the 
property.
    (1) Closing property to public. The head of the facility, or 
designee, shall establish visiting hours for the convenience of the 
public and shall establish specific hours for the transaction of 
business with the public. The property shall be closed to the public 
during other than the hours so established. In emergency situations, the 
property shall be closed to the public when reasonably necessary to 
ensure the orderly conduct of Government business. The decision to close 
a property during an emergency shall be made by the head of the facility 
or designee. The head of the facility or designee shall have authority 
to designate areas within a facility as closed to the public.
    (2) Recording presence. Admission to property during periods when 
such property is closed to the public will be limited to persons 
authorized by the head of the facility or designee. Such persons may be 
required to sign a register and/or display identification documents when 
requested to do so by VA police, or other authorized individual. No 
person, without authorization, shall enter upon or remain on such 
property while the property is closed. Failure to leave such premises by 
unauthorized persons shall constitute an offense under this paragraph.
    (3) Preservation of property. The improper disposal of rubbish on 
property; the spitting on the property; the creation of any hazard on 
property to persons or things; the throwing of articles of any kind from 
a building; the climbing upon the roof or any part of the building, 
without permission; or the willful destruction, damage, or removal of 
Government property or any part thereof, without authorization, is 
prohibited. The destruction, mutilation, defacement, injury, or removal 
of any monument, gravestone, or other structure within the limits of any 
national cemetery is prohibited.
    (4) Conformity with signs and emergency conditions. The head of the 
facility, or designee, shall have authority to post signs of a 
prohibitory and directory nature. Persons, in and on property, shall 
comply with such signs of a prohibitory or directory nature, and during 
emergencies, with the direction of police authorities and other 
authorized officials. Tampering with, destruction, marring, or removal 
of such posted signs is prohibited.
    (5) Disturbances. Conduct on property which creates loud or unusual 
noise; which unreasonably obstructs the usual use of entrances, foyers, 
lobbies, corridors, offices, elevators, stairways, or parking lots; 
which otherwise impedes or disrupts the performance of official duties 
by Government employees; which prevents one from obtaining medical or 
other services provided on the property in a timely manner; or the use 
of loud, abusive, or otherwise improper language; or unwarranted 
loitering, sleeping, or assembly is prohibited. In addition to measures 
designed to secure voluntary terminations of violations of this 
paragraph the head of the facility or designee may cause the issuance of 
orders for persons who are creating a disturbance to depart the 
property. Failure to leave the premises when so ordered constitutes a 
further disturbance within the meaning of this rule, and the offender is 
subject to arrest and removal from the premises.
    (6) Gambling. Participating in games for money or for tangible or 
intangible things, or the operating of gambling devices, the conduct of 
a lottery or pool, or the selling or purchasing of numbers tickets, in 
or on property is prohibited.
    (7) Alcoholic beverages and narcotics. Operating a motor vehicle on 
property by a person under the influence of alcoholic beverages, 
narcotic drugs, hallucinogens, marijuana, barbiturates, or amphetamines 
is prohibited. Entering property under the influence of any narcotic 
drug, hallucinogen, marijuana, barbiturate, amphetamine, or alcoholic 
beverage (unless prescribed by a physician) is prohibited. The use on 
property of any narcotic drug, hallucinogen, marijuana, barbiturate, or 
amphetamine (unless prescribed by a physician) is prohibited. The 
introduction or possession of alcoholic beverages or any narcotic drug, 
hallucinogen, marijuana, barbiturate, and amphetamine on property is 
prohibited, except for liquor or drugs prescribed for use by medical 
authority for medical purposes. Provided such

[[Page 18]]

possession is consistent with the laws of the State in which the 
facility is located, liquor may be used and maintained in quarters 
assigned to employees as their normal abode, and away from the abode 
with the written consent of the head of the facility which specifies a 
special occasion for use and limits the area and period for the 
authorized use.
    (8) Soliciting, vending, and debt collection. Soliciting alms and 
contributions, commercial soliciting and vending of all kinds, 
displaying or distributing commercial advertising, or collecting private 
debts in or on property is prohibited. This rule does not apply to (i) 
national or local drives for funds for welfare, health, or other 
purposes as authorized under Executive Order 12353, Charitable Fund 
Raising (March 23, 1982), as amended by Executive Order 12404 (February 
10, 1983), and regulations issued by the Office of Personnel Management 
implementing these Executive Orders; (ii) concessions or personal 
notices posted by employees on authorized bulletin boards; and (iii) 
solicitation of labor organization membership or dues under 5 U.S.C. 
chapter 71.
    (9) Distribution of handbills. The distributing of materials such as 
pamphlets, handbills, and/or flyers, and the displaying of placards or 
posting of materials on bulletin boards or elsewhere on property is 
prohibited, except as authorized by the head of the facility or designee 
or when such distributions or displays are conducted as part of 
authorized Government activities.
    (10) Photographs for news, advertising, or commercial purposes. 
Photographs for advertising or commercial purposes may be taken only 
with the written consent of the head of the facility or designee. 
Photographs for news purposes may be taken at entrances, lobbies, 
foyers, or in other places designated by the head of the facility or 
designee.
    (11) Dogs and other animals. Dogs and other animals, except seeing-
eye dogs, shall not be brought upon property except as authorized by the 
head of the facility or designee.
    (12) Vehicular and pedestrian traffic. Drivers of all vehicles in or 
on property shall drive in a careful and safe manner at all times and 
shall comply with the signals and directions of police and all posted 
traffic signs. The blocking of entrances, driveways, walks, loading 
platforms, or fire hydrants in or on property is prohibited; parking in 
unauthorized locations or in locations reserved for other persons or 
contrary to the direction of posted signs is prohibited. Creating 
excessive noise on hospital or cemetery premises by muffler cut out, the 
excessive use of a horn, or other means is prohibited. Operation of a 
vehicle in a reckless or unsafe manner, drag racing, bumping, overriding 
curbs, or leaving the roadway is prohibited.
    (13) Weapons and explosives. No person while on property shall carry 
firearms, other dangerous or deadly weapons, or explosives, either 
openly or concealed, except for official purposes.
    (14) Demonstrations. (i) All visitors are expected to observe proper 
standards of decorum and decency while on VA property. Toward this end, 
any service, ceremony, or demonstration, except as authorized by the 
head of the facility or designee, is prohibited. Jogging, bicycling, 
sledding and other forms of physical recreation on cemetery grounds is 
prohibited.
    (ii) For the purpose of the prohibition expressed in this paragraph, 
unauthorized demonstrations or services shall be defined as, but not 
limited to, picketing, or similar conduct on VA property; any oration or 
similar conduct to assembled groups of people, unless the oration is 
part of an authorized service; the display of any placards, banners, or 
foreign flags on VA property unless approved by the head of the facility 
or designee; disorderly conduct such as fighting, threatening, violent, 
or tumultuous behavior, unreasonable noise or coarse utterance, gesture 
or display or the use of abusive language to any person present; and 
partisan activities, i.e., those involving commentary or actions in 
support of, or in opposition to, or attempting to influence, any current 
policy of the Government of the United States, or any private group, 
association, or enterprise.
    (15) Key security. The head of the facility of designee, will 
determine which employees, by virtue of their duties, shall have access 
to keys or barrier-

[[Page 19]]

card keys which operate locks to rooms or areas on the property. The 
unauthorized possession, manufacture, and/or use of such keys or barrier 
cards is prohibited. The surreptitious opening or attempted opening of 
locks or card-operated barrier mechanisms is prohibited.
    (16) Sexual misconduct. Any act of sexual gratification on VA 
property involving two or more persons, who do not reside in quarters on 
the property, is prohibited. Acts of prostitution or solicitation for 
acts of prostitution on VA property is prohibited. For the purposes of 
this paragraph, an act of prostitution is defined as the performance or 
the offer or agreement to perform any sexual act for money or payment.
    (b) Schedule of offenses and penalties. Conduct in violation of the 
rules and regulations set forth in paragraph (a) of this section 
subjects an offender to arrest and removal from the premises. Whomever 
shall be found guilty of violating these rules and regulations while on 
any property under the charge and control of VA is subject to a fine as 
stated in the schedule set forth herein or, if appropriate, the payment 
of fixed sum in lieu of appearance (forfeiture of collateral) as may be 
provided for in rules of the United States District Court. Violations 
included in the schedule of offenses and penalties may also subject an 
offender to a term of imprisonment of not more than six months, as may 
be determined appropriate by a magistrate or judge of the United States 
District Court:
    (1) Improper disposal of rubbish on property, $200.
    (2) Spitting on property, $25.
    (3) Throwing of articles from a building or the unauthorized 
climbing upon any part of a building, $50.
    (4) Willful destruction, damage, or removal of Government property 
without authorization, $500.
    (5) Defacement, destruction, mutilation or injury to, or removal, or 
disturbance of, gravemarker or headstone, $500.
    (6) Failure to comply with signs of a directive and restrictive 
nature posted for safety purposes, $50.
    (7) Tampering with, removal, marring, or destruction of posted 
signs, $150.
    (8) Entry into areas posted as closed to the public or others 
(trespass), $50.
    (9) Unauthorized demonstration or service in a national cemetery or 
on other VA property, $250.
    (10) Creating a disturbance during a burial ceremony, $250.
    (11) Disorderly conduct which creates loud, boisterous, and unusual 
noise, or which obstructs the normal use of entrances, exits, foyers, 
offices, corridors, elevators, and stairways or which tends to impede or 
prevent the normal operation of a service or operation of the facility, 
$250.
    (12) Failure to depart premises by unauthorized persons, $50.
    (13) Unauthorized loitering, sleeping or assembly on property, $50.
    (14) Gambling-participating in games of chance for monetary gain or 
personal property; the operation of gambling devices, a pool or lottery; 
or the taking or giving of bets, $200.
    (15) Operation of a vehicle under the influence of alcoholic 
beverages or nonprescribed narcotic drugs, hallucinogens, marijuana, 
barbiturates, or amphetamines, $500.
    (16) Entering premises under the influence of alcoholic beverages or 
narcotic drugs, hallucinogens, marijuana, barbiturates or amphetamines, 
$200.
    (17) Unauthorized use on property of alcoholic beverages or narcotic 
drugs, hallucinogens, marijuana, barbiturates, or amphetamines, $300.
    (18) Unauthorized introduction on VA controlled property of 
alcoholic beverages or narcotic drugs, hallucinogens, marijuana, 
barbiturates, or amphetamines or the unauthorized giving of same to a 
patient or beneficiary, $500.
    (19) Unauthorized solicitation of alms and contributions on 
premises, $50.
    (20) Commercial soliciting or vending, or the collection of private 
debts on property, $50.
    (21) Distribution of pamphlets, handbills, and flyers, $25.
    (22) Display of placards or posting of material on property, $25.
    (23) Unauthorized photography on premises, $50.
    (24) Failure to comply with traffic directions of VA police, $25.

[[Page 20]]

    (25) Parking in spaces posted as reserved for physically disabled 
persons, $50.
    (26) Parking in no-parking areas, lanes, or crosswalks so posted or 
marked by yellow borders or yellow stripes, $25.
    (27) Parking in emergency vehicle spaces, areas and lanes bordered 
in red or posted as EMERGENCY VEHICLES ONLY or FIRE LANE, or parking 
within 15 feet of a fire hydrant, $50.
    (28) Parking within an intersection or blocking a posted vehicle 
entrance or posted exit lane, $25.
    (29) Parking in spaces posted as reserved or in excess of a posted 
time limit, $15.
    (30) Failing to come to a complete stop at a STOP sign, $25.
    (31) Failing to yield to a pedestrian in a marked and posted 
crosswalk, $25.
    (32) Driving in the wrong direction on a posted one-way street, $25.
    (33) Operation of a vehicle in a reckless or unsafe manner, too fast 
for conditions, drag racing, overriding curbs, or leaving the roadway, 
$100.
    (34) Exceeding posted speed limits:
    (i) By up to 10 mph, $25.
    (ii) By up to 20 mph, $50.
    (iii) By over 20 mph, $100.
    (35) Creating excessive noise in a hospital or cemetery zone by 
muffler cut out, excessive use of a horn, or other means, $50.
    (36) Failure to yield right of way to other vehicles, $50.
    (37) Possession of firearms, carried either openly or concealed, 
whether loaded or unloaded (except by Federal or State law enforcement 
officers on official business, $500.
    (38) Introduction or possession of explosives, or explosive devices 
which fire a projectile, ammunition, or combustibles, $500.
    (39) Possession of knives which exceed a blade length of 3 inches; 
switchblade knives; any of the variety of hatchets, clubs and hand-held 
weapons; or brass knuckles, $300.
    (40) The unauthorized possession of any of the variety of 
incapacitating liquid or gas-emitting weapons, $200.
    (41) Unauthorized possession, manufacture, or use of keys or barrier 
card-type keys to rooms or areas on the property, $200.
    (42) The surreptitious opening, or attempted opening, of locks or 
card-operated barrier mechanisms on property, $500.
    (43) Soliciting for, or the act of, prostitution, $250.
    (44) Any unlawful sexual activity, $250.
    (45) Jogging, bicycling, sledding or any recreational physical 
activity conducted on cemetery grounds, $50.
    (c) Enforcement procedures. (1) VA administration directors will 
issue policies and operating procedures governing the proper exercise of 
arrest and other law enforcement actions, and limiting the carrying and 
use of weapons by VA police officers. VA police officers found qualified 
under respective VA administration directives and duly appointed heads 
of facilities for the purposes of 38 U.S.C. 902(b)(1), will enforce 
these rules and regulations and other Federal laws on VA property in 
accordance with the policies and operating procedures issued by 
respective VA administration directors and under the direction of the 
head of the facility.
    (2) VA administration directors will prescribe training for VA 
police officers of the scope and duration necessary to assure the proper 
exercise of the law enforcement and arrest authority vested in them and 
to assure their abilities in the safe handling of situations involving 
patients and the public in general. VA police officers will successfully 
complete prescribed training in law enforcement procedures and the safe 
handling of patients as a condition of their retention of statutory law 
enforcement and arrest authority.
    (3) Nothing contained in the rules and regulations set forth in 
paragraph (a) of this section shall be construed to abrogate any other 
Federal laws or regulations, including assimilated offenses under 18 
U.S.C. 13, or any State or local laws and regulations applicable to the 
area in which the property is situated.

(Authority: 38 U.S.C. 901)

[50 FR 29226, July 18, 1985]

[[Page 21]]

                  Parking Fees at VA Medical Facilities



Sec. 1.300  Purpose.

    Sections 1.300 through 1.303 prescribe policies and procedures for 
establishing parking fees for the use of Department of Veterans Affairs 
controlled parking spaces at VA medical facilities.

(Authority: 38 U.S.C. 501, 8109)

[53 FR 25490, July 7, 1988]



Sec. 1.301  Definitions.

    As used in Sec. Sec. 1.300 through 1.303 of this title:
    (a) Secretary means the Secretary of Veterans Affairs.
    (b) Eligible person means any individual to whom the Secretary is 
authorized to furnish medical examination or treatment.
    (c) Garage means a structure or part of a structure in which 
vehicles may be parked.
    (d) Medical facility means any facility or part thereof which is 
under the jurisdiction of the Secretary for the provision of health-care 
services, including any necessary buildings and structures, garage or 
parking facility.
    (e) Parking facilities includes all surface and garage parking 
spaces at a VA medical facility.
    (f) Volunteer worker means an individual who performs services, 
without compensation, under the auspices of VA Voluntary Service (VAVS) 
at a VA medical facility, for the benefit of veterans receiving care at 
that medical facility.

(Authority: 38 U.S.C. 8109)

[53 FR 25490, July 7, 1988]



Sec. 1.302  Applicability and scope.

    (a) The provisions of Sec. Sec. 1.300 through 1.303 apply to VA 
medical facility parking facilities in the United States, its 
territories and possessions, and the Commonwealth of Puerto Rico, and to 
such parking facilities for the use of VA medical facilities jointly 
shared by VA and another Federal agency when the facility is operated by 
the VA. Sections 1.300 through 1.303 apply to all users of those parking 
facilities. Fees shall be assessed and collected at medical facilities 
where parking garages are constructed, acquired, or altered at a cost 
exceeding $500,000 (or, in the case of acquisition by lease, $100,000 
per year). The Secretary, in the exercise of official discretion, may 
also determine that parking fees shall be charged at any other VA 
medical facility.
    (b) All fees established shall be reasonable under the circumstances 
and shall cover all parking facilities used in connection with such VA 
medical facility.

(Authority: 38 U.S.C. 8109)

[53 FR 25490, July 7, 1988]



Sec. 1.303  Policy.

    (a) General. Parking spaces at VA medical facilities shall only be 
provided under the following conditions:
    (1) VA and its employees shall not be liable for any damages to 
vehicles (or their contents) parked in VA parking facilities, unless 
such damages are directly caused by such employees acting in the course 
of their VA employment.
    (2) Parking facilities at VA medical facilities shall only be made 
available at each medical facility for such periods and under such terms 
as prescribed by the facility director, consistent with Sec. Sec. 1.300 
through 1.303.
    (3) VA will limit parking facilities at VA medical facilities to the 
minimum necessary, and administer those parking facilities in full 
compliance with ridesharing regulations and Federal laws.
    (b) Fees. (1) As provided in Sec. 1.302, VA will assess VA 
employees, contractor employees, tenant employees, visitors, and other 
individuals having business at a VA medical facility where VA parking 
facilities are available, a parking fee for the use of that parking 
facility. All parking fees shall be set at a rate which shall be 
equivalent to one-half of the appropriate fair rental value (i.e., 
monthly, weekly, daily, hourly) for the use of equivalent commercial 
space in the vicinity of the medical facility, subject to the terms and 
conditions stated in paragraph (a) of this section. Fair rental value 
shall include an allowance for the costs of management of the parking 
facilities. The Secretary will determine the fair market rental value 
through use of generally accepted appraisal techniques. If the

[[Page 22]]

appraisal establishes that there is no comparable commercial rate 
because of the absence of commercial parking facilities within a two-
mile radius of the medical facility, then the rate established shall be 
not less than the lowest rate charged for parking at the VA medical 
facility with the lowest established parking fees. Rates established 
shall be reviewed biannually by the Secretary to reflect any increase or 
decrease in value as determined by appraisal updating.
    (2) No parking fees shall be established or collected for parking 
facilities used by or for vehicles of the following:
    (i) Volunteer workers in connection with such workers performing 
services for the benefit of veterans receiving care at the medical 
facility;
    (ii) A veteran or an eligible person in connection with such veteran 
or eligible person receiving examination or treatment;
    (iii) An individual transporting a veteran or eligible person 
seeking examination or treatment; and
    (iv) Federal Government employees using Government owned or leased 
or private vehicles for official business.

(Authority: 38 U.S.C. 8109)

[53 FR 25490, July 7, 1988]

Release of Information From Department of Veterans Affairs (VA) Records 
Relating to Drug Abuse, Alcoholism or Alcohol Abuse, Infection With the 
        Human Immunodeficiency Virus (HIV), or Sickle Cell Anemia

    Note: Sections 1.460 through 1.499 of this part concern the 
confidentiality of information relating to drug abuse, alcoholism or 
alcohol abuse, infection with the human immunodeficiency virus, or 
sickle cell anemia in VA records and are applicable in combination with 
other regulations pertaining to the release of information from VA 
records. Sections 1.500 through 1.527, Title 38, Code of Federal 
Regulations, implement the provisions of 38 U.S.C. Sec. Sec. 5701 and 
5702. Sections 1.550 through 1.559 implement the provisions of 5 U.S.C. 
Sec. 552 (The Freedom of Information Act). Sections 1.575 through 1.584 
implement the provisions of 5 U.S.C. Sec. 552a (The Privacy Act of 
1974).
    The provisions of Sec. Sec. 1.460 through 1.499 of this part 
pertain to any program or activity, including education, treatment, 
rehabilitation or research, which relates to drug abuse, alcoholism or 
alcohol abuse, infection with the human immunodeficiency virus, or 
sickle cell anemia. The statutory authority for the drug abuse 
provisions and alcoholism or alcohol abuse provisions of Sec. Sec. 
1.460 through 1.499 is Sec. 111 of Pub. L. 94-581, the Veterans Omnibus 
Health Care Act of 1976 (38 U.S.C. Sec. Sec. 7331 through 7334), the 
authority for the human immunodeficiency virus provisions is Sec. 121 of 
Pub. L. 100-322, the Veterans' Benefits and Services Act of 1988 (38 
U.S.C. Sec. 7332); the authority for the sickle cell anemia provisions 
is Sec. 109 of Pub. L. 93-82, the Veterans Health Care Expansion Act of 
1973 (38 U.S.C. Sec. Sec. 1751-1754).

    Authority: 38 U.S.C. 1751-1754 and 7331-7334.

    Source: 60 FR 63929, Dec. 13, 1995, unless otherwise noted.



Sec. 1.460  Definitions.

    For purposes of Sec. Sec. 1.460 through 1.499 of this part, the 
following definitions apply:
    Agreement. The term ``agreement'' means a document that a VA health 
care facility develops in collaboration with an Organ Procurement 
Organization, eye bank or tissue bank with written, detailed 
responsibilities and obligations of the parties with regard to 
identifying potential donors and facilitating the donation process.
    Alcohol abuse. The term ``alcohol abuse'' means the use of an 
alcoholic beverage which impairs the physical, mental, emotional, or 
social well-being of the user.
    Contractor. The term ``contractor'' means a person who provides 
services to VA such as data processing, dosage preparation, laboratory 
analyses or medical or other professional services. Each contractor 
shall be required to enter into a written agreement subjecting such 
contractor to the provisions of Sec. Sec. 1.460 through 1.499 of this 
part; 38 U.S.C. 5701 and 7332; and 5 U.S.C. 552a and 38 CFR 1.576(g).
    Deceased. The term ``deceased'' means death established by either 
neurological criteria (brain death) or cardiopulmonary criteria (cardiac 
death). Brain death is the irreversible cessation of all brain function. 
Cardiac death is the irreversible cessation of circulatory and 
respiratory function. In both cases, ``irreversible'' means

[[Page 23]]

that function will not resume spontaneously and will not be restarted 
artificially.
    Diagnosis. The term ``diagnosis'' means any reference to an 
individual's alcohol or drug abuse or to a condition which is identified 
as having been caused by that abuse or any reference to sickle cell 
anemia or infection with the human immunodeficiency virus which is made 
for the purpose of treatment or referral for treatment. A diagnosis 
prepared for the purpose of treatment or referral for treatment but 
which is not so used is covered by Sec. Sec. 1.460 through 1.499 of 
this part. These regulations do not apply to a diagnosis of drug 
overdose or alcohol intoxication which clearly shows that the individual 
involved is not an alcohol or drug abuser (e.g., involuntary ingestion 
of alcohol or drugs or reaction to a prescribed dosage of one or more 
drugs).
    Disclose or disclosure. The term ``disclose'' or ``disclosure'' 
means a communication of patient identifying information, the 
affirmative verification of another person's communication of patient 
identifying information, or the communication of any information from 
the record of a patient who has been identified.
    Drug abuse. The term ``drug abuse'' means the use of a psychoactive 
substance for other than medicinal purposes which impairs the physical, 
mental, emotional, or social well-being of the user.
    Eye bank and tissue bank. The term ``eye bank and tissue bank'' 
means an ``establishment'' as defined in 21 CFR 1271.3, pursuant to 
section 361 of the Public Health Service Act (42 U.S.C. 264) that has a 
valid, current registration with the Federal Food and Drug 
Administration (FDA) as required under 21 CFR part 1271.
    Individual. The term ``individual'' means a veteran, as defined in 
38 U.S.C. 101(2), or a dependent of a veteran, as defined in 38 U.S.C. 
101(3) and (4)(A).
    Infection with the human immunodeficiency virus (HIV). The term 
``infection with the human immunodeficiency virus (HIV)'' means the 
presence of laboratory evidence for human immunodeficiency virus 
infection. For the purposes of Sec. Sec. 1.460 through 1.499 of this 
part, the term includes the testing of an individual for the presence of 
the virus or antibodies to the virus and information related to such 
testing (including tests with negative results).
    Informant. The term ``informant'' means an individual who is a 
patient or employee or who becomes a patient or employee at the request 
of a law enforcement agency or official and who at the request of a law 
enforcement agency or official observes one or more patients or 
employees for the purpose of reporting the information obtained to the 
law enforcement agency or official.
    Near death. The term ``near death'' means that in the clinical 
judgment of the patient's health care provider, the patient's death is 
imminent.
    Organ Procurement Organization. The term ``Organ Procurement 
Organization'' (OPO) means an organization that performs or coordinates 
the procurement, preservation, and transportation of organs and 
maintains a system of locating prospective recipients for available 
organs.
    Patient. The term ``patient'' means any individual or subject who 
has applied for or been given a diagnosis or treatment for drug abuse, 
alcoholism or alcohol abuse, infection with the human immunodeficiency 
virus, or sickle cell anemia and includes any individual who, after 
arrest on a criminal charge, is interviewed and/or tested in connection 
with drug abuse, alcoholism or alcohol abuse, infection with the human 
immunodeficiency virus, or sickle cell anemia in order to determine that 
individual's eligibility to participate in a treatment or rehabilitation 
program. The term patient includes an individual who has been diagnosed 
or treated for alcoholism, drug abuse, HIV infection, or sickle cell 
anemia for purposes of participation in a VA program or activity 
relating to those four conditions, including a program or activity 
consisting of treatment, rehabilitation, education, training, 
evaluation, or research. The term ``patient'' for the purpose of 
infection with the human immunodeficiency virus or sickle cell anemia, 
includes one tested for the disease.
    Patient identifying information. The term ``patient identifying 
information'' means the name, address, social

[[Page 24]]

security number, fingerprints, photograph, or similar information by 
which the identity of a patient can be determined with reasonable 
accuracy and speed either directly or by reference to other publicly 
available information. The term does not include a number assigned to a 
patient by a treatment program, if that number does not consist of, or 
contain numbers (such as social security, or driver's license number) 
which could be used to identify a patient with reasonable accuracy and 
speed from sources external to the treatment program.
    Person. The term ``person'' means an individual, partnership, 
corporation, Federal, State or local government agency, or any other 
legal entity.
    Procurement organization. The term ``procurement organization'' 
means an organ procurement organization, eye bank, and/or tissue banks 
as defined in this section.
    Records. The term ``records'' means any information received, 
obtained or maintained, whether recorded or not, by an employee or 
contractor of VA, for the purpose of seeking or performing VA program or 
activity functions relating to drug abuse, alcoholism, tests for or 
infection with the human immunodeficiency virus, or sickle cell anemia 
regarding an identifiable patient. A program or activity function 
relating to drug abuse, alcoholism, infection with the human 
immunodeficiency virus, or sickle cell anemia includes evaluation, 
treatment, education, training, rehabilitation, research, or referral 
for one of these conditions. Sections 1.460 through 1.499 of this part 
apply to a primary or other diagnosis, or other information which 
identifies, or could reasonably be expected to identify, a patient as 
having a drug or alcohol abuse condition, infection with the human 
immunodeficiency virus, or sickle cell anemia (e.g., alcoholic 
psychosis, drug dependence), but only if such diagnosis or information 
is received, obtained or maintained for the purpose of seeking or 
performing one of the above program or activity functions. Sections 
1.460 through 1.499 of this part do not apply if such diagnosis or other 
information is not received, obtained or maintained for the purpose of 
seeking or performing a function or activity relating to drug abuse, 
alcoholism, infection with the human immunodeficiency virus, or sickle 
cell anemia for the patient in question. Whenever such diagnosis or 
other information, not originally received or obtained for the purpose 
of obtaining or providing one of the above program or activity 
functions, is subsequently used in connection with such program or 
activity functions, those original entries become a ``record'' and 
Sec. Sec. 1.460 through 1.499 of this part thereafter apply to those 
entries. Segregability: these regulations do not apply to records or 
information contained therein, the disclosure of which (the 
circumstances surrounding the disclosure having been considered) could 
not reasonably be expected to disclose the fact that a patient has been 
connected with a VA program or activity function relating to drug abuse, 
alcoholism, infection with the human immunodeficiency virus, or sickle 
cell anemia.
    (1) The following are examples of instances whereby records or 
information related to alcoholism or drug abuse are covered by the 
provisions of Sec. Sec. 1.460 through 1.499 of this part:
    (i) A patient with alcoholic delirium tremens is admitted for 
detoxification. The patient is offered treatment in a VA alcohol 
rehabilitation program which he declines.
    (ii) A patient who is diagnosed as a drug abuser applies for and is 
provided VA drug rehabilitation treatment.
    (iii) While undergoing treatment for an unrelated medical condition, 
a patient discusses with the physician his use and abuse of alcohol. The 
physician offers VA alcohol rehabilitation treatment which is declined 
by the patient.
    (2) The following are examples of instances whereby records or 
information related to alcoholism or drug abuse are not covered by the 
provisions of Sec. Sec. 1.460 through 1.499 of this part:
    (i) A patient with alcoholic delirium tremens is admitted for 
detoxification, treated and released with no counseling or treatment for 
the underlying condition of alcoholism.
    (ii) While undergoing treatment for an unrelated medical condition, 
a patient informs the physician of a history of drug abuse fifteen years 
earlier with

[[Page 25]]

no ingestion of drugs since. The history and diagnosis of drug abuse is 
documented in the hospital summary and no treatment is sought by the 
patient or offered or provided by VA during the current period of 
treatment.
    (iii) While undergoing treatment for injuries sustained in an 
accident, a patient's medical record is documented to support the 
judgment of the physician to prescribe certain alternate medications in 
order to avoid possible drug interactions in view of the patient's 
enrollment and treatment in a non-VA methadone maintenance program. The 
patient states that continued treatment and follow-up will be obtained 
from private physicians and VA treatment for the drug abuse is not 
sought by the patient nor provided or offered by the staff.
    (iv) A patient is admitted to the emergency room suffering from a 
possible drug overdose. The patient is treated and released; a history 
and diagnosis of drug abuse may be documented in the hospital summary. 
The patient is not offered treatment for the underlying conditions of 
drug abuse, nor is treatment sought by the patient for that condition.
    Third party payer. The term ``third party payer'' means a person who 
pays, or agrees to pay, for diagnosis or treatment furnished to a 
patient on the basis of a contractual relationship with the patient or a 
member of his or her family or on the basis of the patient's eligibility 
for Federal, State, or local governmental benefits.
    Treatment. The term ``treatment'' means the management and care of a 
patient for drug abuse, alcoholism or alcohol abuse, infection with the 
human immunodeficiency virus, or sickle cell anemia, or a condition 
which is identified as having been caused by one or more of these 
conditions, in order to reduce or eliminate the adverse effects upon the 
patient. The term includes testing for the human immunodeficiency virus 
or sickle cell anemia.
    Undercover agent. The term ``undercover agent'' means an officer of 
any Federal, State, or local law enforcement agency who becomes a 
patient or employee for the purpose of investigating a suspected 
violation of law or who pursues that purpose after becoming a patient or 
becoming employed for other purposes.
    VHA health care facilty. The term ``VHA health care facility'' means 
a VA medical center, VA emergency room, VA nursing home or other 
facility as defined in 38 U.S.C. 1701(3).

(Authority: 38 U.S.C. 7334)

[60 FR 63929, Dec. 13, 1995, as amended at 72 FR 48241, Aug. 23, 2007]



Sec. 1.461  Applicability.

    (a) General--(1) Restrictions on disclosure. The restrictions on 
disclosure in these regulations apply to any information whether or not 
recorded, which:
    (i) Would identify a patient as an alcohol or drug abuser, an 
individual tested for or infected with the human immunodeficiency virus 
(HIV), hereafter referred to as HIV, or an individual with sickle cell 
anemia, either directly, by reference to other publicly available 
information, or through verification of such an identification by 
another person; and
    (ii) Is provided or obtained for the purpose of treating alcohol or 
drug abuse, infection with the HIV, or sickle cell anemia, making a 
diagnosis for that treatment, or making a referral for that treatment as 
well as for education, training, evaluation, rehabilitation and research 
program or activity purposes.
    (2) Restriction on use. The restriction on use of information to 
initiate or substantiate any criminal charges against a patient or to 
conduct any criminal investigation of a patient applies to any 
information, whether or not recorded, which is maintained for the 
purpose of treating drug abuse, alcoholism or alcohol abuse, infection 
with the HIV, or sickle cell anemia, making a diagnosis for that 
treatment, or making a referral for that treatment as well as for 
education, training, evaluation, rehabilitation, and research program or 
activity purposes.
    (b) Period covered as affecting applicability. The provisions of 
Sec. Sec. 1.460 through 1.499 of this part apply to records of 
identity, diagnosis, prognosis, or treatment pertaining to any given 
individual maintained over any period of

[[Page 26]]

time which, irrespective of when it begins, does not end before March 
21, 1972, in the case of diagnosis or treatment for drug abuse; or 
before May 14, 1974, in the case of diagnosis or treatment for 
alcoholism or alcohol abuse; or before September 1, 1973, in the case of 
testing, diagnosis or treatment of sickle cell anemia; or before May 20, 
1988, in the case of testing, diagnosis or treatment for an infection 
with the HIV.
    (c) Exceptions--(1) Department of Veterans Affairs and Armed Forces. 
The restrictions on disclosure in Sec. Sec. 1.460 through 1.499 of this 
part do not apply to communications of information between or among 
those components of VA who have a need for the information in connection 
with their duties in the provision of health care, adjudication of 
benefits, or in carrying out administrative responsibilities related to 
those functions, including personnel of the Office of the Inspector 
General who are conducting audits, evaluations, healthcare inspections, 
or non-patient investigations, or between such components and the Armed 
Forces, of information pertaining to a person relating to a period when 
such person is or was subject to the Uniform Code of Military Justice. 
Information obtained by VA components under these circumstances may be 
disclosed outside of VA to prosecute or investigate a non-patient only 
in accordance with Sec. 1.495 of this part. Similarly, the restrictions 
on disclosure in Sec. Sec. 1.460 through 1.499 of this part do not 
apply to communications of information to the Department of Justice or 
U.S. Attorneys who are providing support in civil litigation or possible 
litigation involving VA.
    (2) Contractor. The restrictions on disclosure in Sec. Sec. 1.460 
through 1.499 of this part do not apply to communications between VA and 
a contractor of information needed by the contractor to provide his or 
her services.
    (3) Crimes on VA premises or against VA personnel. The restrictions 
on disclosure and use in Sec. Sec. 1.460 through 1.499 of this part do 
not apply to communications from VA personnel to law enforcement 
officers which:
    (i) Are directly related to a patient's commission of a crime on the 
premises of the facility or against personnel of VA or to a threat to 
commit such a crime; and
    (ii) Are limited to the circumstances of the incident, including the 
patient status of the individual committing or threatening to commit the 
crime, that individual's name and address to the extent authorized by 38 
U.S.C. 5701(f)(2), and that individual's last known whereabouts.
    (4) Undercover agents and informants. (i) Except as specifically 
authorized by a court order granted under Sec. 1.495 of this part, VA 
may not knowingly employ, or admit as a patient, any undercover agent or 
informant in any VA drug abuse, alcoholism or alcohol abuse, HIV 
infection, or sickle cell anemia treatment program.
    (ii) No information obtained by an undercover agent or informant, 
whether or not that undercover agent or informant is placed in a VA drug 
abuse, alcoholism or alcohol abuse, HIV infection, or sickle cell anemia 
treatment program pursuant to an authorizing court order, may be used to 
criminally investigate or prosecute any patient unless authorized 
pursuant to the provisions of Sec. 1.494 of this part.
    (iii) The enrollment of an undercover agent or informant in a 
treatment unit shall not be deemed a violation of this section if the 
enrollment is solely for the purpose of enabling the individual to 
obtain treatment for drug or alcohol abuse, HIV infection, or sickle 
cell anemia.
    (d) Applicability to recipients of information--(1) Restriction on 
use of information. In the absence of a proper Sec. 1.494 court order, 
the restriction on the use of any information subject to Sec. Sec. 
1.460 through 1.499 of this part to initiate or substantiate any 
criminal charges against a patient or to conduct any criminal 
investigation of a patient applies to any person who obtains that 
information from VA, regardless of the status of the person obtaining 
the information or of whether the information was obtained in accordance 
with Sec. Sec. 1.460 through 1.499 of this part. This restriction on 
use bars, among other things, the introduction of that information as 
evidence in a criminal proceeding and any other use of the information 
to investigate or prosecute a patient with respect to a suspected

[[Page 27]]

crime. Information obtained by undercover agents or informants (see 
paragraph (c) of this section) or through patient access (see Sec. 
1.469 of this part) is subject to the restriction on use.
    (2) Restrictions on disclosures--third-party payers and others. The 
restrictions on disclosure in Sec. Sec. 1.460 through 1.499 of this 
part apply to third-party payers and persons who, pursuant to a consent, 
receive patient records directly from VA and who are notified of the 
restrictions on redisclosure of the records in accordance with Sec. 
1.476 of this part.

(Authority: 38 U.S.C. 7332(e) and 7334)



Sec. 1.462  Confidentiality restrictions.

    (a) General. The patient records to which Sec. Sec. 1.460 through 
1.499 of this part apply may be disclosed or used only as permitted by 
these regulations and may not otherwise be disclosed or used in any 
civil, criminal, administrative, or legislative proceedings conducted by 
any Federal, State, or local authority. Any disclosure made under these 
regulations must be limited to that information which is necessary to 
carry out the purpose of the disclosure.
    (b) Unconditional compliance required. The restrictions on 
disclosure and use in Sec. Sec. 1.460 through 1.499 of this part apply 
whether the person seeking the information already has it, has other 
means of obtaining it, is a law enforcement or other official, has 
obtained a subpoena, or asserts any other justification for a disclosure 
or use which is not permitted by Sec. Sec. 1.460 through 1.499 of this 
part. These provisions do not prohibit VA from acting accordingly when 
there is no disclosure of information.
    (c) Acknowledging the presence of patients: responding to requests. 
(1) The presence of an identified patient in a VA facility for the 
treatment or other VA program activity relating to drug abuse, 
alcoholism or alcohol abuse, infection with the HIV, or sickle cell 
anemia may be acknowledged only if the patient's written consent is 
obtained in accordance with Sec. 1.475 of this part or if an 
authorizing court order is entered in accordance with Sec. Sec. 1.490 
through 1.499 of this part. Acknowledgment of the presence of an 
identified patient in a facility is permitted if the acknowledgment does 
not reveal that the patient is being treated for or is otherwise 
involved in a VA program or activity concerning drug abuse, alcoholism 
or alcohol abuse, infection with the HIV, or sickle cell anemia.
    (2) Any answer to a request for a disclosure of patient records 
which is not permissible under Sec. Sec. 1.460 through 1.499 of this 
part must be made in a way that will not affirmatively reveal that an 
identified individual has been, or is being diagnosed or treated for 
drug abuse, alcoholism or alcohol abuse, infection with the HIV, or 
sickle cell anemia. These regulations do not restrict a disclosure that 
an identified individual is not and never has been a patient.

(Authority: 38 U.S.C. 7334)



Sec. 1.463  Criminal penalty for violations.

    Under 38 U.S.C. 7332(g), any person who violates any provision of 
this statute or Sec. Sec. 1.460 through 1.499 of this part shall be 
fined not more than $5,000 in the case of a first offense, and not more 
than $20,000 for a subsequent offense.

(Authority: 38 U.S.C. 7332(g))



Sec. 1.464  Minor patients.

    (a) Definition of minor. As used in Sec. Sec. 1.460 through 1.499 
of this part the term ``minor'' means a person who has not attained the 
age of majority specified in the applicable State law, or if no age of 
majority is specified in the applicable State law, the age of eighteen 
years.
    (b) State law not requiring parental consent to treatment. If a 
minor patient acting alone has the legal capacity under the applicable 
State law to apply for and obtain treatment for drug abuse, alcoholism 
or alcohol abuse, infection with the HIV, or sickle cell anemia, any 
written consent for disclosure authorized under Sec. 1.475 of this part 
may be given only by the minor patient. This restriction includes, but 
is not limited to, any disclosure of patient identifying information to 
the parent or guardian of a minor patient for the purpose of obtaining 
financial reimbursement. Sections 1.460 through 1.499 of this part do 
not prohibit a VA facility from refusing to provide nonemergent 
treatment to an otherwise

[[Page 28]]

ineligible minor patient until the minor patient consents to the 
disclosure necessary to obtain reimbursement for services from a third 
party payer.
    (c) State law requiring parental consent to treatment. (1) Where 
State law requires consent of a parent, guardian, or other person for a 
minor to obtain treatment for drug abuse, alcoholism or alcohol abuse, 
infection with the HIV, or sickle cell anemia, any written consent for 
disclosure authorized under Sec. 1.475 of this part must be given by 
both the minor and his or her parent, guardian, or other person 
authorized under State law to act in the minor's behalf.
    (2) Where State law requires parental consent to treatment, the fact 
of a minor's application for treatment may be communicated to the 
minor's parent, guardian, or other person authorized under State law to 
act in the minor's behalf only if:
    (i) The minor has given written consent to the disclosure in 
accordance with Sec. 1.475 of this part; or
    (ii) The minor lacks the capacity to make a rational choice 
regarding such consent as judged by the appropriate VA facility director 
under paragraph (d) of this section.
    (d) Minor applicant for service lacks capacity for rational choice. 
Facts relevant to reducing a threat to the life or physical well being 
of the applicant or any other individual may be disclosed to the parent, 
guardian, or other person authorized under State law to act in the 
minor's behalf if the appropriate VA facility director judges that:
    (1) A minor applicant for services lacks capacity because of extreme 
youth or mental or physical condition to make a rational decision on 
whether to consent to a disclosure under Sec. 1.475 of this part to his 
or her parent, guardian, or other person authorized under State law to 
act in the minor's behalf, and
    (2) The applicant's situation poses a substantial threat to the life 
or physical well-being of the applicant or any other individual which 
may be reduced by communicating relevant facts to the minor's parent, 
guardian, or other person authorized under State law to act in the 
minor's behalf.

(Authority: 38 U.S.C. 7334)



Sec. 1.465  Incompetent and deceased patients.

    (a) Incompetent patients other than minors. In the case of a patient 
who has been adjudicated as lacking the capacity, for any reason other 
than insufficient age, to manage his or her own affairs, any consent 
which is required under Sec. Sec. 1.460 through 1.499 of this part may 
be given by a court appointed legal guardian.
    (b) Deceased patients--(1) Vital statistics. Sec. 1.460 through 
1.499 of this part do not restrict the disclosure of patient identifying 
information relating to the cause of death of a patient under laws 
requiring the collection of death or other vital statistics or 
permitting inquiry into the cause of death.
    (2) Consent by personal representative. Any other disclosure of 
information identifying a deceased patient as being treated for drug 
abuse, alcoholism or alcohol abuse, infection with the HIV, or sickle 
cell anemia is subject to Sec. Sec. 1.460 through 1.499 of this part. 
If a written consent to the disclosure is required, the Under Secretary 
for Health or designee may, upon the prior written request of the next 
of kin, executor/executrix, administrator/administratrix, or other 
personal representative of such deceased patient, disclose the contents 
of such records, only if the Under Secretary for Health or designee 
determines such disclosure is necessary to obtain survivorship benefits 
for the deceased patient's survivor. This would include not only VA 
benefits, but also payments by the Social Security Administration, 
Worker's Compensation Boards or Commissions, or other Federal, State, or 
local government agencies, or nongovernment entities, such as life 
insurance companies.
    (3) Information related to sickle cell anemia. Information related 
to sickle cell anemia may be released to a blood relative of a deceased 
veteran for medical follow-up or family planning purposes.

(Authority: 38 U.S.C. 7332(b)(3))

[[Page 29]]



Sec. 1.466  Security for records.

    (a) Written records which are subject to Sec. Sec. 1.460 through 
1.499 of this part must be maintained in a secure room, locked file 
cabinet, safe or other similar container when not in use. Access to 
information stored in computers will be limited to authorized VA 
employees who have a need for the information in performing their 
duties. These security precautions shall be consistent with the Privacy 
Act of 1974 (5 U.S.C. 552a).
    (b) Each VA facility shall adopt in writing procedures related to 
the access to and use of records which are subject to Sec. Sec. 1.460 
through 1.499 of this part.

(Authority: 38 U.S.C. 7334)



Sec. 1.467  Restrictions on the use of identification cards and public signs.

    (a) No facility may require any patient to carry on their person 
while away from the facility premises any card or other object which 
would identify the patient as a participant in any VA drug abuse, 
alcoholism or alcohol abuse, HIV infection, or sickle cell anemia 
treatment program. A facility may require patients to use or carry cards 
or other identification objects on the premises of a facility. Patients 
may not be required to wear clothing or colored identification bracelets 
or display objects openly to all facility staff or others which would 
identify them as being treated for drug or alcohol abuse, HIV infection, 
or sickle cell anemia.
    (b) Treatment locations should not be identified by signs that would 
identify individuals entering or exiting these locations as patients 
enrolled in a drug or alcohol abuse, HIV infection, or sickle cell 
anemia program or activity.

(Authority: 38 U.S.C. 7334)



Sec. 1.468  Relationship to Federal statutes protecting research subjects against compulsory disclosure of their identity.

    (a) Research privilege description. There may be concurrent coverage 
of patient identifying information by the provisions of Sec. Sec. 1.460 
through 1.499 of this part and by administrative action taken under Sec. 
303(a) of the Public Health Service Act (42 U.S.C. 241(d) and the 
implementing regulations at 42 CFR Part 2a); or Sec. 502(c) of the 
Controlled Substances Act (21 U.S.C. 872(c) and the implementing 
regulations at 21 CFR 1316.21). These ``research privilege'' statutes 
confer on the Secretary of Health and Human Services and on the Attorney 
General, respectively, the power to authorize researchers conducting 
certain types of research to withhold from all persons not connected 
with the research the names and other identifying information concerning 
individuals who are the subjects of the research.
    (b) Effect of concurrent coverage. Sections 1.460 through 1.499 of 
this part restrict the disclosure and use of information about patients, 
while administrative action taken under the research privilege statutes 
and implementing regulations protects a person engaged in applicable 
research from being compelled to disclose any identifying 
characteristics of the individuals who are the subjects of that 
research. The issuance under Sec. Sec. 1.490 through 1.499 of this part 
of a court order authorizing a disclosure of information about a patient 
does not affect an exercise of authority under these research privilege 
statutes. However, the research privilege granted under 21 CFR 
291.505(g) to treatment programs using methadone for maintenance 
treatment does not protect from compulsory disclosure any information 
which is permitted to be disclosed under those regulations. Thus, if a 
court order entered in accordance with Sec. Sec. 1.490 through 1.499 of 
this part authorizes a VA facility to disclose certain information about 
its patients, the facility may not invoke the research privilege under 
21 CFR 291.505(g) as a defense to a subpoena for that information.

(Authority: 38 U.S.C. 7334)



Sec. 1.469  Patient access and restrictions on use.

    (a) Patient access not prohibited. Sections 1.460 through 1.499 of 
this part do not prohibit a facility from giving a patient access to his 
or her own records, including the opportunity to inspect and copy any 
records that VA maintains about the patient, subject to the provisions 
of the Privacy Act (5 U.S.C.

[[Page 30]]

552a(d)(1)) and 38 CFR 1.577. If the patient is accompanied, giving 
access to the patient and the accompanying person will require a written 
consent by the patient which is provided in accordance with Sec. 1.475 
of this part.
    (b) Restrictions on use of information. Information obtained by 
patient access to patient record is subject to the restriction on use of 
this information to initiate or substantiate any criminal charges 
against the patient or to conduct any criminal investigation of the 
patient as provided for under Sec. 1.461(d)(1) of this part.

(Authority: 38 U.S.C. 7334)



Sec. Sec. 1.470-1.474  [Reserved]

                   Disclosures With Patient's Consent



Sec. 1.475  Form of written consent.

    (a) Required elements. A written consent to a disclosure under 
Sec. Sec. 1.460 through 1.499 of this part must include:
    (1) The name of the facility permitted to make the disclosure (such 
a designation does not preclude the release of records from other VA 
health care facilities unless a restriction is stated on the consent).
    (2) The name or title of the individual or the name of the 
organization to which disclosure is to be made.
    (3) The name of the patient.
    (4) The purpose of the disclosure.
    (5) How much and what kind of information is to be disclosed.
    (6) The signature of the patient and, when required for a patient 
who is a minor, the signature of a person authorized to give consent 
under Sec. 1.464 of this part; or, when required for a patient who is 
incompetent or deceased, the signature of a person authorized to sign 
under Sec. 1.465 of this part in lieu of the patient.
    (7) The date on which the consent is signed.
    (8) A statement that the consent is subject to revocation at any 
time except to the extent that the facility which is to make the 
disclosure has already acted in reliance on it. Acting in reliance 
includes the provision of treatment services in reliance on a valid 
consent to disclose information to a third party payer.
    (9) The date, event, or condition upon which the consent will expire 
if not revoked before. This date, event, or condition must ensure that 
the consent will last no longer than reasonably necessary to serve the 
purpose for which it is given.
    (b) Expired, deficient, or false consent. A disclosure may not be 
made on the basis of a consent which:
    (1) Has expired;
    (2) On its face substantially fails to conform to any of the 
requirements set forth in paragraph (a) of this section;
    (3) Is known to have been revoked; or
    (4) Is known, or through a reasonable effort could be known, by 
responsible personnel of VA to be materially false.
    (c) Notification of deficient consent. Other than the patient, no 
person or entity may be advised that a special consent is required in 
order to disclose information relating to an individual participating in 
a drug abuse, alcoholism or alcohol abuse, HIV, or sickle cell anemia 
program or activity. Where a person or entity presents VA with an 
insufficient written consent for information protected by 38 U.S.C. 
7332, VA must, in the process of obtaining a legally sufficient consent, 
correspond only with the patient whose records are involved, or the 
legal guardian of an incompetent patient or next of kin of a deceased 
patient, and not with any other person.
    (d) It is not necessary to use any particular form to establish a 
consent referred to in paragraph (a) of this section, however, VA Form 
10-5345, titled Request for and Consent to Release of Medical Records 
Protected by 38 U.S.C. 7332, may be used for such purpose.

(Authority: 38 U.S.C. 7332(a)(2) and (b)(1))



Sec. 1.476  Prohibition on redisclosure.

    Each disclosure under Sec. Sec. 1.460 through 1.499 of this part 
made with the patient's written consent must be accompanied by a written 
statement similar to the following:

    This information has been disclosed to you from records protected by 
Federal confidentiality rules (38 CFR Part 1). The Federal rules 
prohibit you from making any further disclosure of this information 
unless further disclosure is expressly permitted by the written consent 
of the person to whom it pertains or as otherwise permitted by 38 CFR

[[Page 31]]

Part 1. A general authorization for the release of medical or other 
information is NOT sufficient for this purpose. The Federal rules 
restrict any use of the information to criminally investigate or 
prosecute any alcohol or drug abuse patient or patient with sickle cell 
anemia or HIV infection.

(Authority: 38 U.S.C. 7334)



Sec. 1.477  Disclosures permitted with written consent.

    If a patient consents to a disclosure of his or her records under 
Sec. 1.475 of this part, a facility may disclose those records in 
accordance with that consent to any individual or organization named in 
the consent, except that disclosures to central registries and in 
connection with criminal justice referrals must meet the requirements of 
Sec. Sec. 1.478 and 1.479 of this part, respectively.

(Authority: 38 U.S.C. 7332(b)(1))



Sec. 1.478  Disclosures to prevent multiple enrollments in detoxification and 

maintenance treatment programs; not applicable to records relating to sickle cell anemia or infection with the human immunodeficiency virus.

    (a) Definitions. For purposes of this section:
    (1) Central registry means an organization which obtains from two or 
more member programs patient identifying information about individuals 
applying for maintenance treatment or detoxification treatment for the 
purpose of avoiding an individual's concurrent enrollment in more than 
one program.
    (2) Detoxification treatment means the dispensing of a narcotic drug 
in decreasing doses to an individual in order to reduce or eliminate 
adverse physiological or psychological effects incident to withdrawal 
from the sustained use of a narcotic drug.
    (3) Maintenance treatment means the dispensing of a narcotic drug in 
the treatment of an individual for dependence upon heroin or other 
morphine-like drugs.
    (4) Member program means a non-VA detoxification treatment or 
maintenance treatment program which reports patient identifying 
information to a central registry and which is in the same State as that 
central registry or is not more than 125 miles from any border of the 
State in which the central registry is located.
    (b) Restrictions on disclosure. VA may disclose patient records to a 
central registry which is located in the same State or is not more than 
125 miles from any border of the State or to any non-VA detoxification 
or maintenance treatment program not more than 200 miles away for the 
purpose of preventing the multiple enrollment of a patient only if:
    (1) The disclosure is made when:
    (i) The patient is accepted for treatment;
    (ii) The type or dosage of the drug is changed; or
    (iii) The treatment is interrupted, resumed or terminated.
    (2) The disclosure is limited to:
    (i) Patient identifying information;
    (ii) Type and dosage of the drug; and
    (iii) Relevant dates.
    (3) The disclosure is made with the patient's written consent 
meeting the requirements of Sec. 1.475 of this part, except that:
    (i) The consent must list the name and address of each central 
registry and each known non-VA detoxification or maintenance treatment 
program to which a disclosure will be made; and
    (ii) The consent may authorize a disclosure to any non-VA 
detoxification or maintenance treatment program established within 200 
miles after the consent is given without naming any such program.
    (c) Use of information limited to prevention of multiple 
enrollments. A central registry and any non-VA detoxification or 
maintenance treatment program to which information is disclosed to 
prevent multiple enrollments may not redisclose or use patient 
identifying information for any purpose other than the prevention of 
multiple enrollments unless authorized by a court order under Sec. Sec. 
1.490 through 1.499 of this part.

(Authority: 38 U.S.C. 7334)



Sec. 1.479  Disclosures to elements of the criminal justice system which have referred patients.

    (a) VA may disclose information about a patient from records covered 
by Sec. Sec. 1.460 through 1.499 of this part to

[[Page 32]]

those persons within the criminal justice system which have made 
participation in a VA treatment program a condition of the disposition 
of any criminal proceedings against the patient or of the patient's 
parole or other release from custody if:
    (1) The disclosure is made only to those individuals within the 
criminal justice system who have a need for the information in 
connection with their duty to monitor the patient's progress (e.g., a 
prosecuting attorney who is withholding charges against the patient, a 
court granting pretrial or posttrial release, probation or parole 
officers responsible for supervision of the patient); and
    (2) The patient has signed a written consent as a condition of 
admission to the treatment program meeting the requirements of Sec. 
1.475 of this part (except paragraph (a)(8) which is inconsistent with 
the revocation provisions of paragraph (c) of this section) and the 
requirements of paragraphs (b) and (c) of this section.
    (b) Duration of consent. The written consent must state the period 
during which it remains in effect. This period must be reasonable, 
taking into account:
    (1) The anticipated length of the treatment recognizing that 
revocation of consent may not generally be effected while treatment is 
ongoing;
    (2) The type of criminal proceeding involved, the need for the 
information in connection with the final disposition of that proceeding, 
and when the final disposition will occur; and
    (3) Such other factors as the facility, the patient, and the 
person(s) who will receive the disclosure consider pertinent.
    (c) Revocation of consent. The written consent must state that it is 
revocable upon the passage of a specified amount of time or the 
occurrence of a specified, ascertainable event. The time or occurrence 
upon which consent becomes revocable may be no earlier than the 
individual's completion of the treatment program and no later than the 
final disposition of the conditional release or other action in 
connection with which consent was given.
    (d) Restrictions on redisclosure and use. A person who receives 
patient information under this section may redisclose and use it only to 
carry out that person's official duties with regard to the patient's 
conditional release or other action in connection with which the consent 
was given, including parole.

(Authority: 38 U.S.C. 7334)



Sec. Sec. 1.480-1.484  [Reserved]

                   Disclosures Without Patient Consent



Sec. 1.485  Medical emergencies.

    (a) General rule. Under the procedures required by paragraph (c) of 
this section, patient identifying information from records covered by 
Sec. Sec. 1.460 through 1.499 of this part may be disclosed to medical 
personnel who have a need for information about a patient for the 
purpose of treating a condition which poses an immediate threat to the 
health of any individual and which requires immediate medical 
intervention.
    (b) Special rule. Patient identifying information may be disclosed 
to medical personnel of the Food and Drug Administration (FDA) who 
assert a reason to believe that the health of any individual may be 
threatened by an error in the manufacture, labeling, or sale of a 
product under FDA jurisdiction, and that the information will be used 
for the exclusive purpose of notifying patients or their physicians of 
potential dangers.
    (c) Procedures. Immediately following disclosure, any VA employee 
making an oral disclosure under authority of this section shall make an 
accounting of the disclosure in accordance with the Privacy Act (5 
U.S.C. 552a(c) and 38 CFR 1.576(c)) and document the disclosure in the 
patient's records setting forth in writing:
    (1) The name and address of the medical personnel to whom disclosure 
was made and their affiliation with any health care facility;
    (2) The name of the individual making the disclosure;
    (3) The date and time of the disclosure;
    (4) The nature of the emergency (or error, if the report was to 
FDA);
    (5) The information disclosed; and

[[Page 33]]

    (6) The authority for making the disclosure (Sec. 1.485 of this 
part).

(Authority: 38 U.S.C. 7332(b)(2)(A))



Sec. 1.485a  Eye, organ and tissue donation.

    A VHA health care facility may disclose the individually-identified 
medical record information of an individual covered by Sec. Sec. 1.460 
through 1.499 of this part to an authorized representative of a 
procurement organization for the purpose of facilitating determination 
of whether the individual is a suitable potential organ, eye, or tissue 
donor if:
    (a) The individual is currently an inpatient in a VHA health care 
facility;
    (b) The individual is, in the clinical judgment of the individual's 
primary health care provider, near death or deceased;
    (c) The VHA health care facility has a signed agreement with the 
procurement organization in accordance with the applicable requirements 
of the United States Department of Health and Human Services (HHS); and
    (d) The VHA health care facility has confirmed with HHS that it has 
certified or recertified the organ procurement organization as provided 
in the applicable HHS regulations. VA medical centers must verify 
annually in January of each calendar year with the Food and Drug 
Administration (FDA) that an eye bank and tissue bank has complied with 
the FDA registration requirements of 21 CFR part 1271 before permitting 
an eye bank or tissue bank to receive protected health information.

(Authority: 38 U.S.C. 5701(k), 7332(b)(2)(E))

[72 FR 48242, Aug. 23, 2007]



Sec. 1.486  Disclosure of information related to infection with the human immunodeficiency virus to public health authorities.

    (a) In the case of any record which is maintained in connection with 
the performance of any program or activity relating to infection with 
the HIV, information may be disclosed to a Federal, State, or local 
public health authority, charged under Federal or State law with the 
protection of the public health, and to which Federal or State law 
requires disclosure of such record, if a qualified representative of 
such authority has made a written request that such record be provided 
as required pursuant to such law for a purpose authorized by such law. 
In the case of a State law, such law must, in order for VA to be able to 
release patient name and address information in accordance with 38 
U.S.C. 5701(f)(2), provide for a penalty or fine or other sanction to be 
assessed against those individuals who are subject to the jurisdiction 
of the public health authority but fail to comply with the reporting 
requirements.
    (b) A person to whom a record is disclosed under this section may 
not redisclose or use such record for a purpose other than that for 
which the disclosure was made.

(Authority: 38 U.S.C. 7332(b)(2)(C))



Sec. 1.487  Disclosure of information related to infection with the human immunodeficiency virus to the spouse or sexual partner of the patient.

    (a) Subject to paragraph (b) of this section, a physician or a 
professional counselor may disclose information or records indicating 
that a patient is infected with the HIV if the disclosure is made to the 
spouse of the patient, or to an individual whom the patient has, during 
the process of professional counseling or of testing to determine 
whether the patient is infected with such virus, identified as being a 
sexual partner of such patient.
    (b) A disclosure under this section may be made only if the 
physician or counselor, after making reasonable efforts to counsel and 
encourage the patient to provide the information to the spouse or sexual 
partner, reasonably believes that the patient will not provide the 
information to the spouse or sexual partner and that the disclosure is 
necessary to protect the health of the spouse or sexual partner.
    (c) A disclosure under this section may be made by a physician or 
counselor other than the physician or counselor referred to in paragraph 
(b) of

[[Page 34]]

this section if such physician or counselor is unavailable by reason of 
extended absence or termination of employment to make the disclosure.

(Authority: 38 U.S.C. 7332(b))



Sec. 1.488  Research activities.

    Subject to the provisions of 38 U.S.C. 5701, 38 CFR 1.500-1.527, the 
Privacy Act (5 U.S.C. 552a), 38 CFR 1.575-1.584 and the following 
paragraphs, patient medical record information covered by Sec. Sec. 
1.460 through 1.499 of this part may be disclosed for the purpose of 
conducting scientific research.
    (a) Information in individually identifiable form may be disclosed 
from records covered by Sec. Sec. 1.460 through 1.499 of this part for 
the purpose of conducting scientific research if the Under Secretary for 
Health or designee makes a determination that the recipient of the 
patient identifying information:
    (1) Is qualified to conduct the research.
    (2) Has a research protocol under which the information:
    (i) Will be maintained in accordance with the security requirements 
of Sec. 1.466 of this part (or more stringent requirements); and
    (ii) Will not be redisclosed except as permitted under paragraph (b) 
of this section.
    (3) Has furnished a written statement that the research protocol has 
been reviewed by an independent group of three or more individuals who 
found that the rights of patients would be adequately protected and that 
the potential benefits of the research outweigh any potential risks to 
patient confidentiality posed by the disclosure of records.
    (b) A person conducting research may disclose information obtained 
under paragraph (a) of this section only back to VA and may not identify 
any individual patient in any report of that research or otherwise 
disclose patient identities.

(Authority: 38 U.S.C. 7332(b)(2)(B))



Sec. 1.489  Audit and evaluation activities.

    Subject to the provisions of 38 U.S.C. 5701, 38 CFR 1.500-1.527, the 
Privacy Act (5 U.S.C. 552a), 38 CFR 1.575-1.584, and the following 
paragraphs, patient medical records covered by Sec. Sec. 1.460 through 
1.499 of this part may be disclosed outside VA for the purposes of 
conducting audit and evaluation activities.
    (a) Records not copies. If patient records covered by Sec. Sec. 
1.460 through 1.499 of this part are not copied, patient identifying 
information may be disclosed in the course of a review of records on VA 
facility premises to any person who agrees in writing to comply with the 
limitations on redisclosure and use in paragraph (d) of this section 
and:
    (1) Where audit or evaluation functions are performed by a State or 
Federal governmental agency on behalf of VA; or
    (2) Who is determined by the VA facility director to be qualified to 
conduct the audit or evaluation activities.
    (b) Copying of records. Records containing patient identifying 
information may be copied by any person who:
    (1) Agrees in writing to:
    (i) Maintain the patient identifying information in accordance with 
the security requirements provided in Sec. 1.466 of this part (or more 
stringent requirements);
    (ii) Destroy all the patient identifying information upon completion 
of the audit or evaluation; and
    (iii) Comply with the limitations on disclosure and use in paragraph 
(d) of this section.
    (2) The VA medical facility director determines to be qualified to 
conduct the audit or evaluation activities.
    (c) Congressional oversight. Records subject to Sec. Sec. 1.460 
through 1.499 of this part upon written request may be released to 
congressional committees or subcommittees for program oversight and 
evaluation if such records pertain to any matter within the jurisdiction 
of such committee or subcommittee.
    (d) Limitation on disclosure and use. Records containing patient 
identifying information disclosed under this section may be disclosed 
only back to VA and used only to carry out an audit or evaluation 
purpose, or, to investigate or prosecute criminal or other activities as 
authorized by a court order entered under Sec. 1.494 of this part.

(Authority: 38 U.S.C. 7332(b)(2)(B))

[[Page 35]]

              Court Orders Authorizing Disclosures and Use



Sec. 1.490  Legal effect of order.

    The records to which Sec. Sec. 1.460 through 1.499 of this part 
apply may be disclosed if authorized by an appropriate order of a court 
of competent jurisdiction granted after application showing good cause 
therefore. In assessing good cause the court is statutorily required to 
weigh the public interest and the need for disclosure against the injury 
to the patient or subject, to the physician-patient relationship, and to 
the treatment services. Upon the granting of such order, the court, in 
determining the extent to which any disclosure of all or any part of any 
record is necessary, is required by statute to impose appropriate 
safeguards against unauthorized disclosure. An order of a court of 
competent jurisdiction to produce records subject to Sec. Sec. 1.460 
through 1.499 of this part will not be sufficient unless the order 
reflects that the court has complied with the requirements of 38 U.S.C. 
7332(b)(2)(D). Such an order from a Federal court compels disclosure. 
However, such an order from a State court only acts to authorize the 
Secretary to exercise discretion pursuant to 38 U.S.C. 5701(b)(5) and 38 
CFR 1.511 to disclose such records. It does not compel disclosure.

(Authority: 38 U.S.C. 7332(b)(2)(D))



Sec. 1.491  Confidential communications.

    (a) A court order under Sec. Sec. 1.490 through 1.499 of this part 
may authorize disclosure of confidential communications made by a 
patient to a treatment program in the course of diagnosis, treatment, or 
referral for treatment only if:
    (1) The disclosure is necessary to protect against an existing 
threat to life or of serious bodily injury, including circumstances 
which constitute suspected child abuse and neglect and verbal threats 
against third parties;
    (2) The disclosure is necessary in connection with investigation or 
prosecution of an extremely serious crime, such as one which directly 
threatens loss of life or serious bodily injury, including homicide, 
rape, kidnapping, armed robbery, assault with a deadly weapon, or child 
abuse and neglect; or
    (3) The disclosure is in connection with litigation or an 
administrative proceeding in which the patient offers testimony or other 
evidence pertaining to the content of the confidential communications.
    (b) [Reserved]

(Authority: 38 U.S.C. 7334)



Sec. 1.492  Order not applicable to records disclosed without consent to researchers, auditors and evaluators.

    A court order under Sec. Sec. 1.460 through 1.499 of this part may 
not authorize qualified personnel, who have received patient identifying 
information from VA without consent for the purpose of conducting 
research, audit or evaluation, to disclose that information or use it to 
conduct any criminal investigation or prosecution of a patient. However, 
a court order under Sec. 1.495 of this part may authorize disclosure 
and use of records to investigate or prosecute VA personnel.

(Authority: 38 U.S.C. 7334)



Sec. 1.493  Procedures and criteria for orders authorizing disclosures for noncriminal purposes.

    (a) Application. An order authorizing the disclosure of patient 
records covered by Sec. Sec. 1.460 through 1.499 of this part for 
purposes other than criminal investigation or prosecution may be applied 
for by any person having a legally recognized interest in the disclosure 
which is sought. The application may be filed separately or as part of a 
pending civil action in which it appears that the patient records are 
needed to provide evidence. An application must use a fictitious name, 
such as John Doe, to refer to any patient and may not contain or 
otherwise disclose any patient identifying information unless the 
patient is the applicant or has given a written consent (meeting the 
requirements of Sec. 1.475 of this part) to disclosure or the court has 
ordered the record of the proceeding sealed from public scrutiny.
    (b) Notice. The patient and VA facility from whom disclosure is 
sought must be given:
    (1) Adequate notice in a manner which will not disclose patient 
identifying information to other persons; and

[[Page 36]]

    (2) An opportunity to file a written response to the application, or 
to appear in person, for the limited purpose of providing evidence on 
whether the statutory and regulatory criteria for the issuance of the 
court order are met.
    (c) Review of evidence: Conduct of hearing. Any oral argument, 
review of evidence, or hearing on the application must be held in the 
judge's chambers or in some manner which ensures that patient 
identifying information is not disclosed to anyone other than a party to 
the proceeding, the patient, or VA, unless the patient requests an open 
hearing in a manner which meets the written consent requirements of 
Sec. 1.475 of this part. The proceeding may include an examination by 
the judge of the patient records referred to in the application.
    (d) Criteria for entry of order. An order under this section may be 
entered only if the court determines that good cause exists. To make 
this determination the court must find that:
    (1) Other ways of obtaining the information are not available or 
would not be effective; and
    (2) The public interest and need for the disclosure outweigh the 
potential injury to the patient, the physician-patient relationship and 
the treatment services.
    (e) Content of order. An order authorizing a disclosure must:
    (1) Limit disclosure to those parts of the patient's record which 
are essential to fulfill the objective of the order;
    (2) Limit disclosure to those persons whose need for information is 
the basis for the order; and
    (3) Include such other measures as are necessary to limit disclosure 
for the protection of the patient, the physician-patient relationship 
and the treatment services; for example, sealing from public scrutiny 
the record of any proceeding for which disclosure of a patient's record 
has been ordered.

(Authority: 38 U.S.C. 7334)



Sec. 1.494  Procedures and criteria for orders authorizing disclosure and use of records to criminally investigate or prosecute patients.

    (a) Application. An order authorizing the disclosure or use of 
patient records covered by Sec. Sec. 1.460 through 1.499 of this part 
to criminally investigate or prosecute a patient may be applied for by 
VA or by any person conducting investigative or prosecutorial activities 
with respect to the enforcement of criminal laws. The application may be 
filed separately, as part of an application for a subpoena or other 
compulsory process, or in a pending criminal action. An application must 
use a fictitious name such as John Doe, to refer to any patient and may 
not contain or otherwise disclose patient identifying information unless 
the court has ordered the record of the proceeding sealed from public 
scrutiny.
    (b) Notice and hearing. Unless an order under Sec. 1.495 of this 
part is sought with an order under this section, VA must be given:
    (1) Adequate notice (in a manner which will not disclose patient 
identifying information to third parties) of an application by a person 
performing a law enforcement function;
    (2) An opportunity to appear and be heard for the limited purpose of 
providing evidence on the statutory and regulatory criteria for the 
issuance of the court order; and
    (3) An opportunity to be represented by counsel.
    (c) Review of evidence: Conduct of hearings. Any oral argument, 
review of evidence, or hearing on the application shall be held in the 
judge's chambers or in some other manner which ensures that patient 
identifying information is not disclosed to anyone other than a party to 
the proceedings, the patient, or VA. The proceeding may include an 
examination by the judge of the patient records referred to in the 
application.
    (d) Criteria. A court may authorize the disclosure and use of 
patient records for the purpose of conducting a criminal investigation 
or prosecution of a patient only if the court finds that all of the 
following criteria are met:
    (1) The crime involved is extremely serious, such as one which 
causes or directly threatens loss of life or serious bodily injury 
including, but not limited to, homicide, rape, kidnapping, armed 
robbery, assault with a deadly weapon, and child abuse and neglect.

[[Page 37]]

    (2) There is a reasonable likelihood that the records will disclose 
information of substantial value in the investigation or prosecution.
    (3) Other ways of obtaining the information are not available or 
would not be effective.
    (4) The potential injury to the patient, to the physician-patient 
relationship and to the ability of VA to provide services to other 
patients is outweighed by the public interest and the need for the 
disclosure.
    (5) If the applicant is a person performing a law enforcement 
function, VA has been represented by counsel independent of the 
applicant.
    (e) Content of order. Any order authorizing a disclosure or use of 
patient records under this section must:
    (1) Limit disclosure and use to those parts of the patient's record 
which are essential to fulfill the objective of the order;
    (2) Limit disclosure to those law enforcement and prosecutorial 
officials who are responsible for, or are conducting, the investigation 
or prosecution, and limit their use of the records to investigation and 
prosecution of extremely serious crime or suspected crime specified in 
the applications; and
    (3) Include such other measures as are necessary to limit disclosure 
and use to the fulfillment on only that public interest and need found 
by the court.

(Authority: 38 U.S.C. 7332(c))



Sec. 1.495  Procedures and criteria for orders authorizing disclosure and use of records to investigate or prosecute VA or employees of VA.

    (a) Application. (1) An order authorizing the disclosure or use of 
patient records covered by Sec. Sec. 1.460 through 1.499 of this part 
to criminally or administratively investigate or prosecute VA (or 
employees or agents of VA) may be applied for by an administrative, 
regulatory, supervisory, investigative, law enforcement, or 
prosecutorial agency having jurisdiction over VA activities.
    (2) The application may be filed separately or as part of a pending 
civil or criminal action against VA (or agents or employees of VA) in 
which it appears that the patient records are needed to provide material 
evidence. The application must use a fictitious name, such as John Doe, 
to refer to any patient and may not contain or otherwise disclose any 
patient identifying information unless the court has ordered the record 
of the proceeding sealed from public scrutiny or the patient has given a 
written consent (meeting the requirements of Sec. 1.475 of this part) 
to that disclosure.
    (b) Notice not required. An application under this section may, in 
the discretion of the court, be granted without notice. Although no 
express notice is required to VA or to any patient whose records are to 
be disclosed, upon implementation of an order so granted VA or the 
patient must be afforded an opportunity to seek revocation or amendment 
of that order, limited to the presentation of evidence on the statutory 
and regulatory criteria for the issuance of the court order.
    (c) Requirements for order. An order under this section must be 
entered in accordance with, and comply with the requirements of, Sec. 
1.493(d) and (e) of this part.
    (d) Limitations on disclosure and use of patient identifying 
information. (1) An order entered under this section must require the 
deletion of patient identifying information from any documents made 
available to the public.
    (2) No information obtained under this section may be used to 
conduct any investigation or prosecution of a patient, or be used as the 
basis for an application for an order under Sec. 1.494 of this part.

(Authority: 38 U.S.C. 7334)



Sec. 1.496  Orders authorizing the use of undercover agents and informants to criminally investigate employees or agents of VA.

    (a) Application. A court order authorizing the placement of an 
undercover agent or informant in a VA drug or alcohol abuse, HIV 
infection, or sickle cell anemia treatment program as an employee or 
patient may be applied for by any law enforcement or prosecutorial 
agency which has reason to believe that employees or agents of the VA 
treatment program are engaged in criminal misconduct.
    (b) Notice. The VA facility director must be given adequate notice 
of the

[[Page 38]]

application and an opportunity to appear and be heard (for the limited 
purpose of providing evidence on the statutory and regulatory criteria 
for the issuance of the court order), unless the application asserts a 
belief that:
    (1) The VA facility director is involved in the criminal activities 
to be investigated by the undercover agent or informant; or
    (2) The VA facility director will intentionally or unintentionally 
disclose the proposed placement of an undercover agent or informant to 
the employees or agents who are suspected of criminal activities.
    (c) Criteria. An order under this section may be entered only if the 
court determines that good cause exists. To make this determination the 
court must find:
    (1) There is reason to believe that an employee or agent of a VA 
treatment program is engaged in criminal activity;
    (2) Other ways of obtaining evidence of this criminal activity are 
not available or would not be effective; and
    (3) The public interest and need for the placement of an undercover 
agent or informant in the VA treatment program outweigh the potential 
injury to patients of the program, physician-patient relationships and 
the treatment services.
    (d) Content of order. An order authorizing the placement of an 
undercover agent or informant in a VA treatment program must:
    (1) Specifically authorize the placement of an undercover agent or 
an informant;
    (2) Limit the total period of the placement to six months;
    (3) Prohibit the undercover agent or informant from disclosing any 
patient identifying information obtained from the placement except as 
necessary to criminally investigate or prosecute employees or agents of 
the VA treatment program; and
    (4) Include any other measures which are appropriate to limit any 
potential disruption of the program by the placement and any potential 
for a real or apparent breach of patient confidentiality; for example, 
sealing from public scrutiny the record of any proceeding for which 
disclosure of a patient's record has been ordered.
    (e) Limitation on use of information. No information obtained by an 
undercover agent or informant placed under this section may be used to 
criminally investigate or prosecute any patient or as the basis for an 
application for an order under Sec. 1.494 of this part.

(Authority: 38 U.S.C. 7334)



Sec. Sec. 1.497-1.499  [Reserved]

  Release of Information From Department of Veterans Affairs Claimant 
                                 Records

    Note: Sections 1.500 through 1.527 concern the availability and 
release of information from files, records, reports, and other papers 
and documents in Department of Veterans Affairs custody pertaining to 
claims under any of the laws administered by the Department of Veterans 
Affairs. As to the release of information from Department of Veterans 
Affairs records other than claimant records, see Sec. Sec. 1.550 
through 1.558. Sections 1.500 through 1.526 implement the provisions of 
38 U.S.C. 5701, 5702.

[32 FR 10848, July 25, 1967]

    Authority: Sections 1.500 to 1.527 issued under 72 Stat. 1114, 1236, 
as amended; 38 U.S.C. 501, 5701.



Sec. 1.500  General.

    (a) Files, records, reports, and other papers and documents 
pertaining to any claim filed with the Department of Veterans Affairs, 
whether pending or adjudicated, and the names and addresses of present 
or former personnel of the armed services, and their dependents, in the 
possession of the Department of Veterans Affairs, will be deemed 
confidential and privileged, and no disclosure therefrom will be made 
except in the circumstances and under the conditions set forth in 
Sec. Sec. 1.501 through 1.526.
    (b) A claimant may not have access to or custody of official 
Department of Veterans Affairs records concerning himself or herself nor 
may a claimant inspect records concerning himself or herself. Disclosure 
of information from Department of Veterans Affairs records to a claimant 
or his or her duly authorized agent or representative may be made, 
however, under the provisions of Sec. Sec. 1.501 through 1.526.

[[Page 39]]

    (c) Each administration, staff office, and field facility head will 
designate an employee(s) who will be responsible for initial action on 
(granting or denying) requests to inspect or obtain information from or 
copies of records under their jurisdiction and within the purview of 
Sec. Sec. 1.501 through 1.526 unless the regulations in this part 
currently contain such designations. The request should be made to the 
office concerned (having jurisdiction of the record desired) or, if not 
known, to the Director or Veterans Assistance Officer in the nearest VA 
regional office, or to the VA Central Office, 810 Vermont Avenue NW., 
Washington, DC 20420. Personal contacts should normally be made during 
the regular duty hours of the office concerned, which are 8 a.m. to 4:30 
p.m., Monday through Friday, for VA Central Office and most field 
facilities. Any legal question arising in a field facility concerning 
the release of information will be referred to the appropriate Regional 
Counsel for disposition as contemplated by Sec. 13.401 of this chapter. 
In central office such legal questions will be referred to the General 
Counsel. Any administrative question will be referred through 
administrative channels to the appropriate administration or staff 
office head.
    (d) Upon denial of a request under paragraph (c) of this section, 
the responsible Department of Veterans Affairs official or designated 
employee will inform the requester in writing of the denial and advise 
him or her that he or she may appeal the denial. The requester will also 
be furnished the title and address of the Department of Veterans Affairs 
official to whom the appeal should be addressed. (See Sec. 1.527.) In 
each instance of denial of a request, the denial will be made a matter 
of record and the record will contain a citation to the specific 
provision of Department of Veterans Affairs regulations upon which the 
denial is based.

[24 FR 8174, Oct. 8, 1959, as amended at 32 FR 10848, July 25, 1967; 38 
FR 15601, June 14, 1973]



Sec. 1.501  Release of information by the Secretary.

    The Secretary of Veterans Affairs or the Deputy Secretary may 
release information, statistics, or reports to individuals or 
organizations when in the Secretary's or Deputy Secretary's judgment 
such release would serve a useful purpose.

[32 FR 10848, July 25, 1967, as amended at 54 FR 34980, Aug. 23, 1989]



Sec. 1.502  Disclosure of the amount of monetary benefits.

    The monthly rate of pension, compensation, dependency and indemnity 
compensation, retirement pay, subsistence allowance, or educational 
assistance allowance of any beneficiary shall be made known to any 
person who applies for such information.

[32 FR 10848, July 25, 1967]



Sec. 1.503  Disclosure of information to a veteran or his or her duly authorized representative as to matters concerning the veteran alone.

    Information may be disclosed to a veteran or his or her duly 
authorized representative as to matters concerning himself or herself 
alone when such disclosure would not be injurious to the physical or 
mental health of the veteran. If the veteran be deceased, matters 
concerning him or her may be disclosed to his widow, children, or next 
of kin if such disclosure will not be injurious to the physical or 
mental health of the person in whose behalf information is sought or 
cause repugnance or resentment toward the decedent.

[13 FR 6999, Nov. 27, 1948]



Sec. 1.504  Disclosure of information to a widow, child, or other claimant.

    Information may be disclosed to a widow, widower, child, or other 
dependent parent or other claimant, or the duly authorized 
representative of any of these persons as to matters concerning such 
person alone when such disclosure will not be injurious to the physical 
or mental health of the person to whom the inquiry relates. If the 
person concerning whom the information is sought is deceased, matters 
concerning such person may be disclosed to the next of kin if the 
disclosures will not be injurious to the physical or mental health of 
the person in whose behalf the information is sought or

[[Page 40]]

cause repugnance or resentment toward the decedent.

[13 FR 6999, Nov. 27, 1948, as amended at 54 FR 34980, Aug. 23, 1989]



Sec. 1.505  Genealogy.

    Information of a genealogical nature when its disclosure will not be 
detrimental to the memory of the veteran and not prejudicial, so far as 
may be apparent, to the interests of any living person or to the 
interests of the Government may be released by the Department of 
Veterans Affairs or in the case of inactive records may be released by 
the Archivist of the United States if in the Archivist's custody.

[13 FR 6999, Nov. 27, 1948]



Sec. 1.506  Disclosure of records to Federal Government departments, State 

unemployment compensation agencies, and the Office of Servicemembers' Group Life Insurance.

    (a) All records or documents required for official purposes by any 
department or other agency of the U.S. Government or any state 
unemployment compensation agency acting in an official capacity for the 
Department of Veterans Affairs shall be furnished in response to an 
official request, written, or oral, from such department or agency. If 
the requesting department or agency does not indicate the purpose for 
which the records or documents are requested and there is doubt as to 
whether they are to be used for official purposes, the requesting 
department or agency will be asked to specify the purpose for which they 
are to be used.
    (b) The Under Secretary for Benefits, Director of Insurance Service, 
or designee of either in Central Office, is authorized to release 
information to OSGLI (Office of Servicemembers' Group Life Insurance) 
for the purpose of aiding in the settlement of a particular insurance 
case.

[33 FR 2994, Feb. 15, 1968]



Sec. 1.507  Disclosures to members of Congress.

    Members of Congress shall be furnished in their official capacity in 
any case such information contained in the Department of Veterans 
Affairs files as may be requested for official use. However, in any 
unusual case, the request will be presented to the Secretary, Deputy 
Secretary, or staff or administration head for personal action. When the 
requested information is of a type which may not be furnished a 
claimant, the member of Congress shall be advised that the information 
is furnished to him or her confidentially in his official capacity and 
should be so treated by him or her. (See 38 U.S.C. 5701.) Information 
concerning the beneficiary designation of a United States Government 
Life Insurance or National Service Life Insurance policy is deemed 
confidential and privileged and during the insured's lifetime shall not 
be disclosed to anyone other than the insured or his or her duly 
appointed fiduciary unless the insured or the fiduciary authorizes the 
release of such information.

[32 FR 10848, July 25, 1967]



Sec. 1.508  Disclosure in cases where claimants are charged with or convicted of criminal offenses.

    (a) Where incompetent claimants are charged with, or convicted of, 
offenses other than those growing out of their relationship with the 
Department of Veterans Affairs and in which it is desired to disclose 
information from the files and records of the Department of Veterans 
Affairs, the Regional Counsel, Under Secretary for Benefits, Veterans 
Benefits Administration, or the General Counsel if the General Counsel 
deems it necessary and proper, may disclose to the court having 
jurisdiction so much of the information from the files and records of 
the Department of Veterans Affairs relating to the mental condition of 
such beneficiaries, the same to be available as evidence, as may be 
necessary to show the mental condition of the accused and the time of 
its onset. This provision, however, does not alter the general procedure 
for handling offenses growing out of relations with the Department of 
Veterans Affairs.
    (b) When desired by a U.S. district court, the Regional Counsel or 
the General Counsel may supply information as to whether any person 
charged with crime served in the military or naval service of the United 
States and

[[Page 41]]

whether the Department of Veterans Affairs has a file on such person. If 
the file is desired either by the court or by the prosecution or 
defense, it may be produced only in accord with Sec. Sec. 1.501 through 
1.526.

[21 FR 10375, Dec. 28, 1956, as amended at 32 FR 10848, July 25, 1967; 
54 FR 34980, Aug. 23, 1989]



Sec. 1.509  Disclosure to courts in proceedings in the nature of an inquest.

    The Under Secretary for Benefits, Veterans Benefits Administration, 
Regional Counsels, and facility heads are authorized to make disclosures 
to courts of competent jurisdiction of such files, records, reports, and 
other documents as are necessary and proper evidence in proceedings in 
the nature of an inquest into the mental competency of claimants and 
other proceedings incident to the appointment and discharge of 
guardians, curators, or conservators to any court having jurisdiction of 
such fiduciaries in all matters of appointment, discharge, or accounting 
in such courts.

[32 FR 10848, July 25, 1967]



Sec. 1.510  Disclosure to insurance companies cooperating with the Department 

of Justice in the defense of insurance suits against the United States.

    Copies of records from the files of the Department of Veterans 
Affairs will, in the event of litigation involving commercial insurance 
policies issued by an insurance company cooperating with the Department 
of Justice in defense of insurance suits against the United States, be 
furnished to such companies without charge, provided the claimant or his 
or her duly authorized representative has authorized the release of the 
information contained in such records. If the release of information is 
not authorized in writing by the claimant or his or her duly authorized 
representative, information contained in the files may be furnished to 
such company if to withhold same would tend to permit the accomplishment 
of a fraud or miscarriage of justice. However, before such information 
may be released without the consent of the claimant, the request 
therefor must be accompanied by an affidavit of the representative of 
the insurance company, setting forth that litigation is pending, the 
character of the suit, and the purpose for which the information desired 
is to be used. If such information is to be used adversely to the 
claimant, the affidavit must set forth facts from which it may be 
determined by the General Counsel or Regional Counsel whether the 
furnishing of the information is necessary to prevent the perpetration 
of a fraud or other injustice. The averments contained in such affidavit 
should be considered in connection with the facts shown by the 
claimant's file, and, if such consideration shows the disclosure of the 
record is necessary and proper to prevent a fraud or other injustice, 
information as to the contents thereof may be furnished to the insurance 
company or copies of the records may be furnished to the court, 
workmen's compensation, or similar board in which the litigation is 
pending upon receipt of a subpoena duces tecum addressed to the 
Secretary of Veterans Affairs, or the head of the office in which the 
records desired are located. In the event the subpoena requires the 
production of the file, as distinguished from the copies of the records, 
no expense to the Department of Veterans Affairs may be involved in 
complying therewith, and arrangements must be made with the 
representative of the insurance company causing the issuance of the 
subpoena to insure submission of the file to the court without expense 
to the Department of Veterans Affairs.

[32 FR 10848, July 25, 1967]



Sec. 1.511  Disclosure of claimant records in connection with judicial proceedings generally.

    (a)(1) Where a suit (or legal proceeding) has been threatened or 
instituted against the Government, or a prosecution against a claimant 
has been instituted or is being contemplated, the request of the 
claimant or his or her duly authorized representative for information, 
documents, reports, etc., shall be acted upon by the General Counsel in 
Central Office, or the Regional Counsel for the field facility, who 
shall determine the action to be taken with respect thereto. Where

[[Page 42]]

the records have been sent to the Department of Justice in connection 
with any such suit (or legal proceeding), the request will be referred 
to the Department of Justice, Washington, DC, through the office of the 
General Counsel, for attention. Where the records have been sent to an 
Assistant U.S. Attorney, the request will be referred by the appropriate 
Regional Counsel to the Assistant U.S. Attorney. In all other cases 
where copies of documents or records are desired by or on behalf of 
parties to a suit (or legal proceeding), whether in a Federal court or 
any other, such copies shall be disclosed as provided in paragraphs (b) 
and (c) of this section where the request is accompanied by court 
process, or paragraph (e) of this section where the request is not 
accompanied by court process. A court process, such as a court order or 
subpoena duces tecum should be addressed to either the Secretary of 
Veterans Affairs or to the head of the field facility at which the 
records desired are located. The determination as to the action to be 
taken upon any request for the disclosure of claimant records received 
in this class of cases shall be made by the component having 
jurisdiction over the subject matter in Central Office, or the division 
having jurisdiction over the subject matter in the field facility, 
except in those cases in which representatives of the component or 
division have determined that the records desired are to be used 
adversely to the claimant, in which event the process will be referred 
to the General Counsel in Central Office or to the Regional Counsel for 
the field facility for disposition.
    (2) Where a claim under the provisions of the Federal Tort Claims 
Act has been filed, or where such a claim can reasonably be anticipated, 
no information, documents, reports, etc., will be disclosed except 
through the Regional Counsel having jurisdiction, who will limit the 
disclosure of information to that which would be available under 
discovery proceedings, if the matter were in litigation. Any other 
information may be disclosed only after concurrence in such disclosure 
is provided by the General Counsel.
    (b) Disclosures in response to Federal court process--(1) Court 
order. Except for drug and alcohol abuse, human immunodeficiency virus 
and sickle cell anemia treatment records, which are protected under 38 
U.S.C. 7332, where the records sought are maintained in a VA Privacy Act 
system of records, and are retrieved by the name or other personal 
identifier of a living claimant who is a citizen of the United States or 
an alien lawfully admitted for permanent residence, a Federal court 
order is the process necessary for the disclosure of such records. Upon 
receipt of a Federal court order directing disclosure of claimant 
records, such records will be disclosed. Disclosure of records protected 
under 38 U.S.C. 7332 will be made in accordance with provisions of 
paragraph (g) of this section.
    (2) Subpoena. Except for drug and alcohol abuse, human 
immunodeficiency virus and sickle cell anemia treatment records, which 
are protected under 38 U.S.C. 7332, where the records sought are 
maintained in a VA Privacy Act system of records, and are retrieved by 
the name or other personal identifier of a claimant, a subpoena is not 
sufficient authority for the disclosure of such records and such records 
will not be disclosed, unless the claimant is deceased, or either is not 
a citizen of the United States, or is an alien not lawfully admitted for 
permanent residence. Where one of these exceptions applies, upon receipt 
of a Federal court subpoena, such records will be disclosed. 
Additionally, where the subpoena is accompanied by authorization from 
the claimant, disclosure will be made. Regarding the disclosure of 
medical records pertaining to drug and alcohol abuse, human 
immunodeficiency virus and sickle cell anemia treatment, a subpoena is 
insufficient for such disclosure. Specific provisions for the disclosure 
of these records are set forth in paragraph (g) of this section.
    (3) A disclosure of records in response to the receipt of a Federal 
court process will be made to those individuals designated in the 
process to receive such records, or to the court from which the process 
issued. Where original records are produced, they must remain at all 
times in the custody of a representative of the Department of Veterans 
Affairs, and, if offered and received in evidence, permission should

[[Page 43]]

be obtained to substitute a copy so that the original may remain intact 
in the record. Where a court process is issued by or on behalf of a 
party litigant other than the United States, such party litigant must 
prepay the costs of copies in accordance with fees prescribed by Sec. 
1.526(i) and any other costs incident to producing the records.
    (c) Disclosures in response to state or local court processs--(1) 
State or local court order. Except for drug and alcohol abuse, human 
immunodeficiency virus and sickle cell anemia treatment records, which 
are protected under 38 U.S.C. 7332, where the records sought are 
maintained in a VA Privacy Act system of records, and are retrieved by 
the name or other personal identifier of a living claimant who is a 
citizen of the United States or an alien lawfully admitted for permanent 
residence, a State or local court order is the process necessary for 
disclosure of such records. Upon receipt of a State or local court order 
directing disclosure of claimant records, disclosure of such records 
will be made in accordance with the provisions set forth in paragraph 
(c)(3) of this section. Disclosure of records protected under 38 U.S.C. 
7332 will be made in accordance with provisions of paragraph (g) of this 
section.
    (2) State or local court subpoena. Except for drug and alcohol 
abuse, human immunodeficiency virus and sickle cell anemia treatment 
records, which are protected under 38 U.S.C. 7332, where the records 
sought are maintained in a VA Privacy Act system of records, and are 
retrieved by the name or other personal identifier of a claimant, a 
subpoena is not sufficient authority for disclosure of such records and 
such records will not be disclosed unless the claimant is deceased, or, 
either is not a citizen of the United States, or is an alien not 
lawfully admitted for permanent residence. Where one of these exceptions 
applies, upon receipt of a State or local court subpoena directing 
disclosure of claimant records, disclosure of such records will be made 
in accordance with the provisions set forth in paragraph (c)(3), of this 
section. Regarding the disclosure of 7332 records, a subpoena is 
insufficient for such disclosure. Specific provisions for the disclosure 
of these records are set forth in paragraph (g) of this section.
    (3) Where the disclosure provisions of paragraph (c) (1) or (2) of 
this section apply, disclosure will be made as follows:
    (i) When the process presented is accompanied by authority from the 
claimant; or,
    (ii) In the absence of claimant disclosure authority, the Regional 
Counsel having jurisdiction must determine whether the disclosure of the 
records is necessary to prevent the perpetration of fraud or other 
injustice in the matter in question. To make such a determination, the 
Regional Counsel may require such additional documentation, e.g., 
affidavit, letter of explanation, or such other documentation which 
would detail the need for such disclosure, set forth the character of 
the pending suit, and the purpose for which the documents or records 
sought are to be used as evidence. The claimant's record may also be 
considered in the making of such determination. Where a court process is 
received, and the Regional Counsel finds that additional documentation 
will be needed to make the foregoing determination, the Regional 
Counsel, or other employee having reasonable knowledge of the 
requirements of this regulation, shall contact the person causing the 
issuance of such court process, and advise that person of the need for 
additional documentation. Where a court appearance is appropriate, and 
the Regional Counsel has found that there is an insufficient basis upon 
which to warrant a disclosure of the requested information, the Regional 
Counsel, or other employee having reasonable knowledge of the 
requirement of this regulation and having consulted with the Regional 
Counsel, shall appear in court and advise the court that VA records are 
confidential and privileged and may be disclosed only in accordance with 
applicable Federal regulations, and to further advise the court of such 
regulatory requirements and how they have not been satisified. Where 
indicated, the Regional Counsel will take appropriate action to have the 
matter of disclosure of the affected records removed to Federal court.

[[Page 44]]

    (4) Any disclosure of records in response to the receipt of State or 
local court process will be made to those individuals designated in the 
process to receive such records, or to the court from which such process 
issued. Payment of the fees as prescribed by Sec. 1.526(i), as well as 
any other cost incident to producing the records, must first be 
deposited with the Department of Veterans Affairs by the party who 
caused the process to be issued. The original records must remain at all 
times in the custody of a representative of the Department of Veterans 
Affairs, and, if there is an offer and admission of any record or 
document contained therein, permission should be obtained to substitute 
a copy so that the original may remain intact in the record.
    (d) Notice requirements where disclosures are made pursuant to court 
process. Whenever a disclosure of Privacy Act protected records is made 
in response to the process of a Federal, State, or local court, the 
custodian of the records disclosed will make reasonable efforts to 
notify the subject of such records that such subject's records were 
disclosed to another person under compulsory legal process. Such notice 
should be accomplished when the process compelling disclosure becomes a 
matter of public record. Generally, a notice sent to the last known 
address of the subject would be sufficient to comply with this 
requirement.
    (e) Disclosures in response to requests when not accompanied by 
court process. Requests received from attorneys or others for copies of 
records for use in suits in which the Government is not involved, not 
accompanied by a court process, will be handled by the component or 
division having jurisdiction over the subject matter. If the request can 
be complied with under Sec. 1.503 or Sec. 1.504, and under the Privacy 
Act (to the extent that such records are protected by the Privacy Act), 
the records requested will be disclosed upon receipt of the required 
fee. If, however, the records cannot be furnished under such authority, 
the applicant will be advised of the procedure to obtain copies of 
records as set forth in paragraphs (b) and (c) of this section.
    (f) Suits by or against the Secretary under 38 U.S.C. 3720. Records 
pertaining to the loan guaranteed, insured, or made by the Department of 
Veterans Affairs may be made available by the General Counsel or the 
Regional Counsel subject to the usual rules of evidence, and where 
authorized under the Privacy Act, after clearance with the Department of 
Justice or U.S. Attorney if appropriate.
    (g) Disclosure of drug abuse, alcohol abuse, human immunodeficiency 
virus and sickle cell anemia treatment or related records under court 
process. Disclosure of these types of records, which are protected from 
unauthorized disclosure under 38 U.S.C. 7332, may be made only in 
response to an appropriate order of a court of competent jurisdiction 
granted after application showing good cause therefore. In assessing 
good cause the court is required to weigh the public interest and the 
need for disclosure against the injury to the patient or subject, to the 
physician-patient relationship, and to the treatment services. The 
court, in determining the extent to which any disclosure of all or any 
part of any record is necessary, shall impose appropriate safeguards 
against unauthorized disclosure. As to a Federal court order satisfying 
the requirements of this paragraph, the records will be disclosed as 
provided in such order. As to a State or local court order satisfying 
the requirements of this subsection, the disclosure of the records 
involved is conditioned upon satisfying the provisions set forth in 
paragraph (c)(3) of this section. If the aforementioned section is 
satisfied, and a disclosure of records is to be forthcoming, the records 
will be disclosed as provided in the court order.

(Authority: 5 U.S.C. 552; 5 U.S.C. 552a; 38 U.S.C. 5701 and 38 U.S.C. 
7332)

[56 FR 15833, Apr. 18, 1991]



Sec. 1.512  Disclosure of loan guaranty information.

    (a) The disclosure of records or information contained in loan 
guaranty files is governed by the Freedom of Information Act, 5 U.S.C. 
552; the Privacy Act, 5 U.S.C. 552a; the confidentiality provisions of 
38 U.S.C. 5701, and the provisions of 38 CFR 1.500-1.584. In

[[Page 45]]

addition, the release of names and addresses and the release of 
certificates of reasonable value, appraisal reports, property inspection 
reports, or reports of inspection on individual water supply and sewage 
disposal systems shall be governed by paragraphs (b), (c), (d), and (e) 
of this section.
    (b)(1) Upon request, any person is entitled to obtain copies of 
certificates of reasonable value, appraisal reports, property inspection 
reports, or reports of inspection on individual water supply and sewage 
disposal systems provided that the individual identifiers of the 
veteran-purchaser(s) or dependents are deleted prior to release of such 
documents. However, individual identifiers may be disclosed in 
accordance with paragraph (b)(2) of this section. The address of the 
property being appraised or inspected shall not be considered an 
individual identifier.


(Authority: 38 U.S.C. 5701(a), (c))

    (2) Individual identifiers of veteran purchasers or dependents may 
be disclosed when disclosure is made to the following:
    (i) The individual purchasing the property;
    (ii) The current owner of the property;
    (iii) The individual that requested the appraisal or report;
    (iv) A person or entity which is considering making a loan to an 
individual with respect to the property concerned; or
    (v) An attorney, real estate broker, or any other agent representing 
any of these persons.


(Authority: 38 U.S.C. 5701(c), (h)(2)(D))

    (c)(1) The Secretary may release the name, address, or both, and may 
release other information relating to the identity of an applicant for 
or recipient of a Department of Veterans Affairs-guaranteed, insured, or 
direct loan, specially adapted housing grant, loan to finance 
acquisition of Department of Veterans Affairs-owned property, release of 
liability, or substitution of entitlement to credit reporting agencies, 
companies or individuals extending credit, depository institutions, 
insurance companies, investors, lenders, employers, landlords, utility 
companies and governmental agencies for any of the purposes specified in 
paragraph (c)(2) of this section.
    (2) A release may be made under paragraph (c)(1) of this section:
    (i) To enable such parties to provide the Department of Veterans 
Affairs with data which assists in determining the creditworthiness, 
credit capacity, income or financial resources of the applicant for or 
recipient of loan guaranty administered benefits, or verifying whether 
any such data previously received is accurate; or
    (ii) To enable the Secretary to offer for sale or other disposition 
any loan or installment sale contract.


(Authority: 38 U.S.C. 5701(h)(2)(A), (B), (C))

    (d) Upon request, the Secretary may release information relating to 
the individual's loan transaction to credit reporting agencies, 
companies or individuals extending credit, depository institutions, 
insurance companies, investors, lenders, employers, landlords, utility 
companies and governmental agencies where necessary in connection with a 
transfer of information on the status of a Department of Veterans 
Affairs loan account to persons or organizations proposing to extend 
credit or render services or other benefits to the borrower in order 
that the person or organization may determine whether to extend credit 
or render services or other benefits to the borrower. Such releases 
shall be made only if the person or organization seeking the information 
furnishes the individual's name, address or other information necessary 
to identify the individual.


(Authority: 38 U.S.C. 5701(e), (h)(2)(A) and (D))

    (e) The Secretary shall maintain information in the loan guaranty 
file consisting of the date, notice and purpose of each disclosure, and 
the name and address of the person to whom the disclosure is made from 
the loan guaranty files.

(Authority: 38 U.S.C. 5701(h)(2)(D), 5 U.S.C. 552a(c))

[47 FR 11279, Mar. 16, 1982]

[[Page 46]]



Sec. 1.513  Disclosure of information contained in Armed Forces service and 

related medical records in Department of Veterans Affairs custody.

    (a) Service records. Information received by the Department of 
Veterans Affairs from the Departments of the Army, Navy, Air Force, and 
the Department of Transportation relative to the military or naval 
service of a claimant is furnished solely for the official use of the 
Department of Veterans Affairs but such information may be disclosed 
under the limitations contained in Sec. Sec. 1.501 through 1.526.
    (b) Medical records. Information contained in the medical records 
(including clinical records and social data) may be released under the 
following conditions:
    (1) Complete transcript of r[eacute]sum[eacute] or medical records 
on request to:
    (i) The Department of the Army.
    (ii) The Department of the Navy (including naval aviation and United 
States Marine Corps).
    (iii) The Department of the Air Force.
    (iv) The Department of Transportation (Coast Guard).
    (v) Selective Service (in case of registrants only).
    (vi) Federal or State hospitals or penal institutions when the 
veteran is a patient or inmate therein.
    (vii) United States Public Health Service, or other governmental or 
contract agency in connection with research authorized by, or conducted 
for, the Department of Veterans Affairs.
    (viii) Registered civilian physicians, on the request of the 
individual or his or her legal representative, when required in 
connection with the treatment of the veteran. (The transcript or resume 
should be accompanied by the statement ``it is expected that the 
information contained herein will be treated as confidential, as is 
customary in civilian professional medical practice.'')
    (ix) The veteran on request, except information contained in the 
medical record which would prove injurious to his or her physical or 
mental health.
    (x) The next of kin on request of the individual, or legal 
representative, when the information may not be disclosed to the veteran 
because it will prove injurious to his or her physical or mental health, 
and it will not be injurious to the physical or mental health of the 
next of kin or cause repugnance or resentment toward the veteran; and 
directly to the next of kin, or legal representative, when the veteran 
has been declared to be insane or is dead.
    (xi) Health and social agencies, on the authority of the veteran or 
his or her duly authorized representative.
    (2) In addition to the authorizations in paragraph (b)(1) of this 
section, the Department of Justice, the Department of the Treasury, and 
the U.S. Postal Service may, on request, be given pertinent information 
from medical records for use in connection with investigations conducted 
by these departments. Each such request shall be considered on its 
merits, and the information released should be the minimum necessary in 
connection with the investigation conducted by these departments.
    (3) Compliance with court orders calling for the production of 
medical records in connection with litigation or criminal prosecutions 
will be effected in accordance with Sec. 1.511.

[13 FR 7001, Nov. 27, 1948, as amended at 32 FR 10849, July 25, 1967; 60 
FR 63938, Dec. 13, 1995]



Sec. 1.514  Disclosure to private physicians and hospitals other than Department of Veterans Affairs.

    (a) When a beneficiary elects to obtain medical attention as a 
private patient from a private practitioner or in a medical center other 
than a Department of Veterans Affairs hospital, there may be disclosed 
to such private practitioner or head of such medical center (Federal, 
State, municipal, or private), such information as to the medical 
history, diagnosis, findings, or treatment as is requested, including 
the loan of original X-ray films, whether Department of Veterans Affairs 
clinical X-rays or service department entrance and separation X-rays, 
provided there is also submitted a written authorization from the 
beneficiary or his or her duly authorized representative. The 
information will be supplied without charge directly to the private 
physician or medical center head and not

[[Page 47]]

through the beneficiary or representative. In forwarding this 
information, it will be accompanied by the stipulations that it is 
released with consent of or on behalf of the patient and that the 
information will be treated as confidential, as is customary in civilian 
professional medical practice.
    (b) Such information may be released without charge and without 
consent of the patient or his or her duly authorized representative when 
a request for such information is received from:
    (1) The superintendent of a State hospital for psychotic patients, a 
commissioner or head of a State department of mental hygiene, or head of 
a State, county, or city health department; or
    (2) Any fee basis physician or institution in connection with 
authorized treatment of the veteran as a Department of Veterans Affairs 
beneficiary; or
    (3) Any physician or medical installation treating the veteran under 
emergency conditions.

[34 FR 13368, Aug. 19, 1969, as amended at 54 FR 34980, Aug. 23, 1989]



Sec. 1.514a  Disclosure to private psychologists.

    When a beneficiary elects to obtain therapy or analysis as a private 
patient from a private psychologist, such information in the medical 
record as may be pertinent may be released. Generally, only information 
developed and documented by Department of Veterans Affairs psychologists 
will be considered pertinent, although other information from the 
medical record may be released if it is determined to be pertinent and 
will serve a useful purpose to the private psychologist in rendering his 
or her services. Information will be released under this section upon 
receipt of the written authorization of the beneficiary or his or her 
duly authorized representative. Information will be forwarded to private 
psychologists directly, not through the beneficiary or representative, 
without charge and with the stipulation that it is released with consent 
of or on behalf of the patient and must be treated as confidential as is 
customary in regular professional practice.

[34 FR 13368, Aug. 19, 1969]



Sec. 1.514b  Disclosures to procurement organizations.

    A VHA health care facility may disclose the name and home address of 
an ``individual'' as defined in Sec. 1.460 to an authorized 
representative of a ``procurement organization'' as also defined in 
Sec. 1.460 for the purpose of facilitating a determination by the 
procurement organization of whether the individual is a suitable 
potential organ, eye, or tissue donor if:
    (a) The individual is currently an inpatient in a VHA health care 
facility;
    (b) The individual is, in the clinical judgment of the individual's 
primary health care provider, near death or is deceased as defined in 
Sec. 1.460;
    (c) The VHA health care facility has a signed agreement with the 
procurement organization in accordance with the applicable requirements 
of the United States Department of Health and Human Services (HHS); and
    (d) The VHA health care facility has confirmed with HHS that it has 
certified or recertified the organ procurement organization as provided 
in the applicable HHS regulations. VA medical centers must verify 
annually in January of each calendar year with FDA that an eye bank or 
tissue bank has complied with the FDA registration requirements of 21 
CFR part 1271 before permitting an eye bank or tissue bank to receive 
protected health information.

(Authority: 38 U.S.C. 5701(k), 7332(b)(2)(E))

[72 FR 48242, Aug. 23, 2007]



Sec. 1.515  To commanding officers of State soldiers' homes.

    When a request is received in a Department of Veterans Affairs 
regional office, center, or medical center from the commanding officer 
of a State soldiers' home for information other than information 
relative to the character of the discharge from a Department of Veterans 
Affairs center or medical center concerning a veteran formerly domiciled 
or hospitalized therein, the provisions of Sec. 1.500 are applicable, 
and no disclosure will be made unless the request is accompanied by the 
authorization outlined in Sec. 1.503. However, station heads, upon 
receipt of a request from the commanding officer of a State

[[Page 48]]

soldiers' home for the character of the discharge of a veteran from a 
period of hospital treatment or domiciliary care as a beneficiary of the 
Department of Veterans Affairs, will comply with the request, 
restricting the information disclosed solely to the character of the 
veteran's discharge from such treatment or care. Such information will 
be disclosed only upon receipt of a specific request therefor from the 
commanding officer of a State soldiers' home.

[30 FR 6435, May 8, 1965]



Sec. 1.516  Disclosure of information to undertaker concerning burial of a deceased veteran.

    When an undertaker requests information believed to be necessary in 
connection with the burial of a deceased veteran, such as the name and 
address of the beneficiary of the veteran's Government insurance policy, 
name and address of the next of kin, rank or grade of veteran and 
organization in which he or she served, character of the veteran's 
discharge, or date and place of birth of the veteran, and it appears 
that the undertaker is holding the body awaiting receipt of the 
information requested, the undertaker, in such instances, may be 
considered the duly authorized representative of the deceased veteran 
for the purpose of obtaining said information. In ordinary cases, 
however, the undertaker will be advised that information concerning the 
beneficiary of a Government insurance policy is confidential and cannot 
be disclosed; the beneficiary will be advised immediately of the 
inquiry, and the furnishing of the desired information will be 
discretionary with the beneficiary. In no case will the undertaker be 
informed of the net amount due under the policy or furnished information 
not specifically mentioned in this paragraph.

[46 FR 62059, Dec. 22, 1981]



Sec. 1.517  Disclosure of vocational rehabilitation and education information 

to educational institutions cooperating with the Department of Veterans Affairs.

    Requests from educational institutions and agencies cooperating with 
the Department of Veterans Affairs in the vocational rehabilitation and 
education of veterans for the use of vocational rehabilitation and 
education records for research studies will be forwarded to central 
office with the facility head's recommendation for review by the Under 
Secretary for Benefits. Where the request to conduct a research study is 
approved by the Under Secretary for Benefits, the facility head is 
authorized by this section to release information for such studies from 
vocational rehabilitation and education records as required: Provided, 
however, That any data or information obtained shall not be published 
without prior approval of the Under Secretary for Benefits and that data 
contained in published material shall not identify any individual 
veteran.

[30 FR 6435, May 8, 1965]



Sec. 1.518  Addresses of claimants.

    (a) It is the general policy of the Department of Veterans Affairs 
to refuse to furnish addresses from its records to persons who desire 
such information for debt collection, canvassing, harassing or for 
propaganda purposes.
    (b) The address of a Department of Veterans Affairs claimant as 
shown by Department of Veterans Affairs files may be furnished to:
    (1) Duly constituted police or court officials upon official request 
and the submission of a certified copy either of the indictment returned 
against the claimant or of the warrant issued for his or her arrest.
    (2) Police, other law enforcement agencies, or Federal, State, 
county, or city welfare agencies upon official written request showing 
that the purpose of the request is to locate a parent who has deserted 
his or her child or children and that other reasonable efforts to obtain 
an address have failed. The address will not be released when such 
disclosure would be prejudicial to the mental or physical health of the 
claimant. When an address is furnished it will be accompanied by the 
stipulation that it is furnished on a confidential basis and may not be 
disclosed to any other individual or agency.
    (c) When an address is requested that may not be furnished under 
Sec. Sec. 1.500 through 1.526, the person making the request will be 
informed that a letter,

[[Page 49]]

or in those cases involving judicial actions, the process or notice in 
judicial proceedings, enclosed in an unsealed envelope showing no return 
address, with the name of the addressee thereon, and bearing sufficient 
postage to cover mailing costs will be forwarded by the Department of 
Veterans Affairs. If a request indicates that judicial action is 
involved in which a process or notice in judicial proceedings is 
required to be forwarded, the Department of Veterans Affairs will inform 
the person who requests the forwarding of such a document that the 
envelope must bear sufficient postage to cover costs of mailing and 
certified or registered mailing fees, including cost of obtaining 
receipt for the certified or registered mail when transmission by this 
type special mail is desired. At the time the letter, process, or notice 
in judicial proceedings is forwarded, the facility's return address will 
be placed on the envelope. When the receipt for certified or registered 
mail or the undelivered envelope is returned to the Department of 
Veterans Affairs, the original sender will be notified thereof: However, 
the receipt or the envelope will be retained by the Department of 
Veterans Affairs. This provision will be applicable only when it does 
not interfere unduly with the functions of the Service or division 
concerned. In no event will letters be forwarded to aid in the 
collection of debts or for the purpose of canvassing, harassing, or 
propaganda. Neither will a letter be forwarded if the contents could be 
harmful to the physical or mental health of the recipient.
    (d) Subject to the conditions set forth in Sec. 1.922, the 
Department of Veterans Affairs may disclose to consumer reporting 
agencies information contained in a debtor's claims folder. Such 
information may include the debtor's name and/or address, Department of 
Veterans Affairs file number, Social Security number, and date of birth.

(Authority: 38 U.S.C. 5701(g))

[33 FR 10516, July 24, 1968 and 35 FR 5176, Mar. 27, 1970, as amended at 
46 FR 62059, Dec. 22, 1981]



Sec. 1.519  Lists of names and addresses.

    (a) Any organization wanting a list of names and addresses of 
present or former personnel of the armed services and their dependents 
from the Department of Veterans Affairs must make written application to 
the Department of Veterans Affairs Controller, except lists of 
educationally disadvantaged veterans should be requested from the 
Director of the nearest regional office. The application must:
    (1) Clearly identify the type or category of names and addresses 
sought;
    (2) Furnish proof satisfactory to the Department of Veterans Affairs 
that the organization seeking the list is a ``nonprofit organization.'' 
Normally, evidence establishing that the organization is exempt from 
taxation in accordance with the provisions of 26 U.S.C. 501 or is a 
governmental body or institution will be accepted as satisfying this 
criteria;
    (3) Contain a statement clearly setting forth the purpose for which 
the list is sought, the programs and the resources the organization 
proposes to devote to this purpose, and establish how such purpose is 
``directly connected with the conduct of programs and the utilization of 
benefits'' under title 38, U.S.C.; and
    (4) Contain a certification that the organization, and all members 
thereof who will have access to the list, are aware of the penalty 
provisions of 38 U.S.C. 5701(f) and will not use the list for any 
purpose other than that stated in the application.
    (b) If the Director of the regional office concerned finds that the 
organization requesting the list of names and addresses of educationally 
disadvantaged veterans is a nonprofit organization and operates an 
approved program of special secondary, remedial, preparatory or other 
educational or supplementary assistance to veterans as provided under 
subchapter V, title 38 U.S.C., then he or she may authorize the release 
of such names and addresses to the organization requesting them.
    (c) The Associate Deputy Assistant Secretary for Information 
Resources Management, with the concurrence of the General Counsel, is 
authorized to release lists of names and addresses to organizations 
which have applied for such lists in accordance with paragraph (a) of 
this section if he or she

[[Page 50]]

finds that the purpose for which the organization desires the names and 
addresses is directly connected with the conduct of programs and the 
utilization of benefits under title 38 U.S.C. Lists of names and 
addresses authorized to be released pursuant to this paragraph shall not 
duplicate lists released to other elements, segments, or chapters of the 
same organization.
    (d) If the list requested is one that the Department of Veterans 
Affairs has previously compiled or created, in the same format, to carry 
out one or more of its basic program responsibilities and it is 
determined that it can be released, the list may be furnished without 
charge. For other types of lists, a charge will be made in accordance 
with the provisions of Sec. 1.526.
    (e) Upon denial of a request, the Department of Veterans Affairs 
Controller or Regional Office Director will inform the requester in 
writing of the denial and the reasons therefor and advise the 
organization that it may appeal the denial to the General Counsel. In 
each instance of a denial of a request, the denial and the reasons 
therefor will be made a matter of record.
    (f) Section 5701(f), title 38 U.S.C., provides that any 
organization, or member thereof, which uses the names and addresses 
furnished it for any purpose other than one directly connected with the 
conduct of programs and the utilization of benefits under title 38 
U.S.C., shall be fined not more than $500 in the case of the first 
offense and not more than $5,000 in the case of the subsequent offenses. 
Any instance in which there is evidence of a violation of these penal 
provisions will be reported in accordance with Sec. 14.560.

(Approved by the Office of Management and Budget under control number 
2900-0438)

[38 FR 15601, June 14, 1973, as amended at 46 FR 62059, Dec. 22, 1981; 
49 FR 32848, Aug. 17, 1984; 56 FR 59218, Nov. 25, 1991]



Sec. 1.520  Confidentiality of social data.

    Persons having access to social data will be conscious of the fact 
that the family, acquaintances, and even the veteran have been willing 
to reveal these data only on the promise that they will be held in 
complete confidence. There will be avoided direct, ill-considered 
references which may jeopardize the personal safety of these individuals 
and the relationship existing among them, the patient, and the social 
worker, or may destroy their mutual confidence and influence, rendering 
it impossible to secure further cooperation from these individuals and 
agencies. Physicians in talking with beneficiaries will not quote these 
data directly but will regard them as indicating possible directions 
toward which they may wish to guide the patient's self-revelations 
without reproaching the patient for his or her behavior or arousing 
natural curiosity or suspicion regarding any informant's statement. The 
representatives of service organizations and duly authorized 
representatives of veterans will be especially cautioned as to their 
grave responsibility in this connection.

[46 FR 62059, Dec. 22, 1981]



Sec. 1.521  Special restrictions concerning social security records.

    Information received from the Social Security Administration may be 
filed in the veteran's claims folder without special provisions. Such 
information will be deemed privileged and may not be released by the 
Department of Veterans Affairs except that information concerning the 
amount of social security benefits paid to a claimant or the amount of 
social security tax contributions made by the claimant may be disclosed 
to the claimant or his or her duly authorized representative. Any 
request from outside the Department of Veterans Affairs for other social 
security information will be referred to the Social Security 
Administration for such action as they deem proper.

[27 FR 9599, Sept. 28, 1962]



Sec. 1.522  Determination of the question as to whether disclosure will be 

prejudicial to the mental or physical health of claimant.

    Determination of the question when disclosure of information from 
the files, records, and reports will be prejudicial to the mental or 
physical health of the claimant, beneficiary, or other person in whose 
behalf information is

[[Page 51]]

sought, will be made by the Chief Medical Director; Chief of Staff of a 
hospital; or the Director of an outpatient clinic.

[33 FR 19009, Dec. 20, 1968]



Sec. 1.523  [Reserved]



Sec. 1.524  Persons authorized to represent claimants.

    A duly authorized representative will be:
    (a) Any person authorized in writing by the claimant to act for him 
or her,
    (b) An attorney who has filed the declaration required by Sec. 
14.629(b)(1) of this chapter, or
    (c) His or her legally constituted fiduciary, if the claimant is 
incompetent. Where for proper reasons no legally constituted fiduciary 
has been or will be appointed, his or her spouse, his or her children, 
or, if the claimant is unmarried, either of his or her parents shall be 
recognized as the fiduciary of the claimant.

[33 FR 6536, Apr. 30, 1968]



Sec. 1.525  Inspection of records by or disclosure of information to 

recognized representatives of organizations and recognized attorneys.

    (a)(1) The accredited representatives of recognized organizations 
(Sec. 14.627 of this chapter) holding appropriate power of attorney and 
recognized attorneys (Sec. 14.629(b) of this chapter) with the written 
authorization of the claimant may, subject to the restrictions imposed 
by paragraph (a)(2) of this section, inspect the claims, insurance and 
allied folders of any claimant upon the condition that only such 
information contained therein as may be properly disclosed under 
Sec. Sec. 1.500 through 1.526 will be disclosed by him or her to the 
claimant or, if the claimant is incompetent, to his or her legally 
constituted fiduciary. Under the same restrictions, it is permissible to 
release information from and permit inspection of loan guaranty folders 
in which a request for a waiver of the debt of a veteran or his or her 
spouse has been received, or where there has been a denial of basic 
eligibility for loan guaranty benefits. All other information in the 
files shall be treated as confidential and will be used only in 
determining the status of the cases inspected or in connection with the 
presentation to officials of the Department of Veterans Affairs of the 
claim of the claimant. The heads of field facilities and the directors 
of the services concerned in Central Office will each designate a 
responsible officer to whom requests for all files must be made, except 
that managers of centers with insurance activities will designate two 
responsible officials, recommended by the division chiefs concerned, one 
responsible for claims and allied folders and the other for insurance 
files. The term claimant as used in this paragraph includes insureds.
    (2) In the case of a living veteran a representative acting under a 
power of attorney from any person not acting on behalf of the veteran 
will not be permitted to review the records of the veteran or be 
furnished any information therefrom to which the person is not entitled, 
i.e., information not relating to such person alone. Powers of attorney 
submitted by the other person will be considered ``Limited'' and will be 
so noted when associated with the veteran's records. The provisions of 
this subparagraph are also applicable to recognized attorneys and the 
requisite declarations filed by them.
    (3) When power of attorney does not obtain, the accredited 
representative will explain to the designated officer of the Department 
of Veterans Affairs the reason for requesting information from the file, 
and the information will be made available only when in the opinion of 
the designated officer it is justified; in no circumstances will such 
representatives be allowed to inspect the file; in such cases a contact 
report will be made out and attached to the case, outlining the reasons 
which justify the verbal or written release of the information to the 
accredited representative.
    (4) In any case where there is an unrevoked power of attorney or 
declaration of representation, no persons or organizations other than 
the one named in such document shall be afforded information from the 
file except under the conditions set forth in Sec. 14.629(b)(2) of this 
chapter. When any claimant has filed notice with the Department of 
Veterans Affairs that he or

[[Page 52]]

she does not want his or her file inspected, such file will not be made 
available for inspection.
    (b)(1) Inspection of folders by accredited representatives or 
recognized attorneys holding a written authorization where such cases 
are being processed shall be in space assigned for such inspection. 
Otherwise station heads may permit inspection of folders at the desks of 
the accredited representatives, in the office(s) which they regularly 
occupy.
    (2) An insured or after maturity of the insurance by death of the 
insured, the beneficiary, may authorize the release to a third person of 
such insurance information as the insured or the beneficiary would be 
entitled to receive, provided there is submitted to the Department of 
Veterans Affairs, a specific authorization in writing for this purpose.
    (3) Unless otherwise authorized by the insured or the beneficiary, 
as the case may be, such authorized representative, recognized attorney 
or accredited representative shall not release information as to the 
designated beneficiary to anyone other than the insured or to the 
beneficiary after death of the insured. Otherwise, information in the 
insurance file shall be subject to the provisions of Sec. Sec. 1.500 
through 1.526.
    (4) Clinical records and medical files, including files for 
outpatient treatment, may be inspected by accredited representatives or 
recognized attorneys holding a written authorization only to the extent 
such records or parts thereof are incorporated in the claims folder, or 
are made available to Department of Veterans Affairs personnel in the 
adjudication of the claim. Records or data in clinical or medical files 
which are not incorporated in the claims folder or which are not made 
available to Department of Veterans Affairs personnel for adjudication 
purposes will not be inspected by anyone other than those employees of 
the Department of Veterans Affairs whose duties require same for the 
purpose of clinical diagnosis or medical treatment.
    (5) Under no circumstances shall any paper be removed from a file, 
except by a Department of Veterans Affairs employee, for purpose of 
having an authorized copy made. Copying of material in a file shall not 
be permitted except in connection with the performance of authorized 
functions under the power of attorney or requisite declaration of a 
recognized attorney.
    (6) In any case involving litigation against the Government, whether 
contemplated or initiated, inspection, subject to the foregoing, shall 
be within the discretion of the General Counsel or Regional Counsel, 
except that in insurance suits under 38 U.S.C. 1975, 1984, inspection 
shall be within the discretion of the official having jurisdiction of 
the claim. Files in such cases may be released to the Department of 
Justice, but close liaison will be maintained to insure their return 
intact upon termination of the litigation.
    (c) Facility heads and the directors of the services concerned in 
central office will be responsible for the administrative compliance 
with and accomplishment of the foregoing within their jurisdiction, and 
any violations of the prescribed conditions for inspection of files or 
release of information therefrom will be brought to the immediate 
attention of the Secretary.
    (d) Any person holding power of attorney, a recognized attorney who 
has filed the requisite declaration, or the accredited representative of 
a recognized organization holding power of attorney shall be supplied 
with a copy of each notice to the claimant respecting the adjudication 
of the claim. If a claimant dies before action on the claim is 
completed, the person or organization holding power of attorney or the 
attorney who has filed the requisite declaration may continue to act 
until the action is completed except where the power of attorney or 
requisite declaration was filed on behalf of a dependent.
    (e) When in developing a claim the accredited representative of a 
recognized organization finds it necessary to call upon a local 
representative to assemble information or evidence, he or she may make 
such disclosures to the local representative as the circumstances of the 
case may warrant, provided the power of attorney to the recognized 
organization contains an

[[Page 53]]

authorization permitting such disclosure.

[13 FR 7002, Nov. 27, 1948, as amended at 31 FR 3459, Mar. 5, 1966; 32 
FR 10849, July 25, 1967; 33 FR 6536, Apr. 30, 1968]



Sec. 1.526  Copies of records and papers.

    (a) Any person desiring a copy of any record or document in the 
custody of the Department of Veterans Affairs, which is subject to be 
furnished under Sec. Sec. 1.501 through 1.526, must make written 
application for such copy to the Department of Veterans Affairs 
installation having custody of the subject matter desired, stating 
specifically: (1) The particular record or document the copy of which is 
desired and whether certified and validated, or uncertified, (2) the 
purpose for which such copy is desired to be used.
    (b) The types of services provided by the Department of Veterans 
Affairs for which fees will be charged are identified in paragraph (i) 
of this section.
    (c) This section applies to the services furnished in paragraph (b) 
of this section when rendered to members of the public by the Department 
of Veterans Affairs. It does not apply to such services when rendered to 
or for other agencies or branches of the Federal Government, or State 
and local governments when furnishing the service will help to 
accomplish an objective of the Department of Veterans Affairs, or when 
performed in connection with a special research study or compilation 
when the party requesting such services is charged an amount for the 
whole job.
    (d) When copies of a record or document are furnished under 
Sec. Sec. 1.506, 1.507, 1.510, and 1.514, such copies shall be supplied 
without charge. Moreover, free service may be provided, to the extent of 
one copy, to persons who have been required to furnish original 
documents for retention by the Department of Veterans Affairs.
    (e) The following are circumstances under which services may be 
provided free at the discretion of facility heads or responsible Central 
Office officials:
    (1) When requested by a court, when the copy will serve as a 
substitute for personal court appearance of a Government witness.
    (2) When furnishing the service free saves costs or yields income 
equal to the direct costs of the agency providing the service. This 
includes cases where the fee for the service would be included in a 
billing against the Government (for example, in cost-type contracts, or 
in the case of private physicians who are treating Government 
beneficiaries at Government expense).
    (3) When a service is occasional and incidental, not of a type that 
is requested often, and if it is administratively determined that a fee 
would be inappropriate in such an occasional case.
    (f) When information, statistics, or reports are released or 
furnished under Sec. 1.501 or Sec. 1.519, the fee charge, if any, will 
be determined upon the merits of each individual application.
    (g) In those cases where it is determined that a fee shall be 
charged, the applicant will be advised to deposit the amount of the 
lawful charge for the copy desired. The amount of such charge will be 
determined in accordance with the schedule of fees prescribed in 
paragraph (i) of this section. The desired copy will not be delivered, 
except under court subpoena, until the full amount of the lawful charge 
is deposited. Any excess deposit of $1 or more over the lawful charge 
will be returned to the applicant. Excess deposits of less than $1 will 
be returned upon request. When a deposit is received with an 
application, such a deposit will be returned to the applicant should the 
application be denied.
    (h) Copies of reports or records received from other Government 
departments or agencies will not be furnished except as provided in 
Sec. 1.513.
    (i) Fees to be charged--(1) Schedule of fees:

------------------------------------------------------------------------
              Activity                               Fees
------------------------------------------------------------------------
(i) Duplication of document by any   $0.15 per page after first 100 one-
 type of reproduction process to      sided pages.
 produce plain one-sided paper
 copies of a standard size (8\1/
 2\ x 11; 8\1/
 2\ x 14;
 11 x 14).

[[Page 54]]

 
(ii) Duplication of non-paper        Actual direct cost to the Agency as
 records, such as microforms,         defined in Sec.  1.555(a)(2) of
 audiovisual materials (motion        this part to the extent that it
 pictures, slides, laser optical      pertains to the cost of
 disks, video tapes, audiotapes,      duplication.
 etc.) computer tapes and disks,
 diskettes for personal computers,
 and any other automated media
 output.
(iii) Duplication of documents by    Actual direct cost to the Agency as
 any type of reproduction process     defined in Sec.  1.555(a)(2) of
 not covered by paragraphs (i)(1)     this part to the extent that it
 (i) and (ii) of this section to      pertains to the cost of
 produce a copy in a form             duplication.
 reasonably usable by a requester.
(iv) Providing special information,  Actual cost to the Agency including
 statistics, reports, drawings,       computer and manual search costs,
 specifications, lists of names and   copying costs, labor, and material
 addresses (either in paper or        and overhead expenses.
 machine readable form), computer
 or other machine readable output.
(v) Attestation under the seal of    $3.00 per document so certified.
 the Agency.
(vi) Providing abstracts or copies   $10.00 per request.
 of medical and dental records to
 insurance companies for other than
 litigation purposes.
(vii) Providing files under court    Actual direct cost to the Agency.
 subpoena.
------------------------------------------------------------------------
(Note. If VA regularly contracts for duplicating services related to
  providing the requested records, such as the duplication of microfilm
  or architect's plans and drawings, the contractor fees may be included
  in the actual direct cost to the Agency)

    (2) Benefit records. When VA benefit records are requested by a VA 
beneficiary or applicant for VA benefits, the duplication fee for one 
complete set of such records will be waived.


(Authority: 38 U.S.C. 5702(b))

    (j) If the copy is to be transmitted by certified or registered 
mail, airmail, or special delivery mail, the postal fees therefor shall 
be added to the other fees provided in paragraph (i) of this section (or 
the order must include postage stamps or stamped return envelopes for 
the purpose).
    (k) Those Department of Veterans Affairs installations not having 
copying equipment are authorized to arrange with the nearest Department 
of Veterans Affairs installation having such equipment to make the 
necessary authorized copies of records or documents.
    (l) Administration, staff office, and field facility heads are 
authorized to designate employees to certify copies of records and 
papers furnished under the provisions of paragraph (a) of this section.

[19 FR 3224, June 2, 1954, as amended at 32 FR 10850, July 25, 1967; 33 
FR 9342, June 26, 1968; 35 FR 20001, Dec. 31, 1970; 37 FR 2676, Feb. 4, 
1972; 39 FR 3938, Jan. 31, 1974; 53 FR 10376, Mar. 31, 1988; 54 FR 
34980, Aug. 23, 1989]



Sec. 1.527  Administrative review.

    (a) Any person may, in the event of a denial of his or her request 
to inspect or obtain information from or copies of records within the 
purview of Sec. Sec. 1.501 through 1.526, appeal such denial. Such 
appeal, stating the circumstances of the denial, should be addressed, as 
appropriate, to the field facility, administration, or staff office 
head.
    (b) A denial action not reversed by a field facility, 
administration, or staff office head on appeal, will be referred through 
normal channels to the General Counsel.
    (c) The final agency decision in such appeals will be made by the 
General Counsel or the Deputy General Counsel.

[32 FR 10850, July 25, 1967, as amended at 55 FR 21546, May 25, 1990]

Release of Information From Department of Veterans Affairs Records Other 
                          Than Claimant Records

    Note: Sections 1.550 through 1.559 concern the availability and 
release of information from files, records, reports, and other papers 
and documents in Department of Veterans Affairs custody other than those 
pertaining to claims under any of the laws administered by the 
Department of Veterans Affairs. As to the release of information from 
Department of Veterans Affairs claimant records, see Sec. Sec. 1.500 
through 1.527. Section 1.550 series implement the provisions of 5 U.S.C. 
552.

[40 FR 12656, Mar. 20, 1975]

    Authority: Sections 1.550 to 1.559 issued under 72 Stat. 1114; 38 
U.S.C. 501.

[[Page 55]]



Sec. 1.550  General.

    The Department of Veterans Affairs policy is one of disclosure of 
information from agency records to the extent permitted by law. This 
includes the release of information which the Department of Veterans 
Affairs is authorized to withhold under 5 U.S.C. 552(b) (see Sec. 
1.554) if it is determined: (a) By the Secretary of Veterans Affairs or 
the Deputy Secretary that disclosure of such information will serve a 
useful purpose or (b) by an administration, staff office, or field 
facility head or designee under Sec. 1.556(a) that disclosure will not 
adversely affect the proper conduct of official business or constitute 
an invasion of personal privacy.

[40 FR 12656, Mar. 20, 1975]



Sec. 1.551  [Reserved]



Sec. 1.552  Public access to information that affects the public when not published in the Federal Register as constructive notice.

    (a) Those statements of policy and interpretations adopted by the 
Department of Veterans Affairs but not published in the Federal 
Register, and administrative manuals and staff instructions that affect 
any member of the public, unless promptly published and copies offered 
for sale, will be kept currently indexed by the office of primary 
program responsibility or the Manager, Administrative Services, as 
determined by the Secretary or designee. Such index or indexes or 
supplements thereto will be promptly published, quarterly or more 
frequently, and distributed (by sale or otherwise) unless the Department 
of Veterans Affairs determines by order published in the Federal 
Register that publication would be unnecessary and impracticable, in 
which case the Department of Veterans Affairs will nonetheless provide 
copies of such index or indexes or supplements thereto on request at a 
cost not to exceed the direct cost of duplication. Both the index and 
the materials indexed as required by this paragraph will be made 
available to the public, for inspection and copying. Public reading 
facilities for this purpose will be maintained in Department of Veterans 
Affairs Central Office and Department of Veterans Affairs field 
facilities, open to the public during the normal duty hours of the 
office in which located. Orders made in the adjudication of individual 
claims under laws administered by the Department of Veterans Affairs are 
confidential and privileged by statute (38 U.S.C. 5701) and so are 
exempt from this requirement.
    (b) When publishing or making available to the public any opinion, 
order, statement of policy, interpretation, staff manual or instruction 
to staff, identifying details will be deleted, and the deletion 
justified in writing, to the extent required to prevent a clearly 
unwarranted invasion of personal privacy.
    (c) No final order, opinion, statement of policy, interpretation, 
staff manual or instruction which is issued, adopted, or promulgated 
after July 4, 1967, that affects any member of the public may be relied 
upon, used, or cited as precedent against any private party unless it 
has been indexed and either made available or published as provided in 
this section or unless that private party shall have actual and timely 
notice of the terms thereof.

[32 FR 10850, July 25, 1967, as amended at 40 FR 12657, Mar. 20, 1975; 
72 FR 65462, Nov. 21, 2007]



Sec. 1.553  Public access to other reasonably described records.

    (a) Except for requests for records which are processed under 
Sec. Sec. 1.551 and 1.552 of this part, unless otherwise provided for 
in title 38, Code of Federal Regulations, all requests for records shall 
be processed under paragraph (b) of this section, as well as under any 
other VA law or regulation governing access to or confidentiality of 
records or information. Records or information customarily furnished to 
the public in the regular course of the performance of official duties 
may be furnished to the public without reference to paragraph (b) of 
this section. To the extent permitted by other laws and regulations, VA 
will also consider making available records which it is permitted to 
withhold under the FOIA if it determines that such disclosure could be 
in the public interest.
    (b) Reasonably described records in VA custody, or copies thereof, 
other than records made available to the

[[Page 56]]

public under provisions of Sec. Sec. 1.551 and 1.552 of this part, or 
unless otherwise provided for in title 38, Code of Federal Regulations, 
requested in accordance with published rules stating the time, place, 
fees (if any), and procedures to be followed, will be made promptly 
available, except as provided in Sec. 1.554 of this part, to any person 
upon request. Such request must be in writing, over the signature of the 
requester and must contain a reasonable description of the record 
desired so that it may be located with relative ease. The request should 
be made to the office concerned (having jurisdiction of the record 
desired) or, if not known, to the Director or Veterans Service Center 
Manager in the nearest VA regional office; the Director, or Chief, 
Medical Administration Service, or other responsible official of VA 
medical facility where most recently treated; or to the Department of 
Veterans Affairs Central Office, 810 Vermont Avenue NW., Washington, DC 
20420. Personal contacts should normally be made during the regular duty 
hours of the office concerned, which are 8 a.m. to 4:30 p.m. Monday 
through Friday for VA Central Office and most field facilites.

(Authority: 5 U.S.C. 552(a)(3))

[53 FR 10377, Mar. 31, 1988, as amended at 71 FR 28586, May 17, 2006]



Sec. 1.553a  Time limits for Department of Veterans Affairs response to requests for records.

    (a) When a request for records made under Sec. 1.551, Sec. 1.552 
or Sec. 1.553 is received it will be promptly referred for action to 
the proper employee designated in accordance with Sec. 1.556 to take 
initial action on granting or denying requests to inspect or obtain 
information from or copies of the records described.
    (b) Any such request will then be promptly evaluated and a 
determination made within 10 days (excepting Saturdays, Sundays, and 
legal public holidays) after the receipt of the request whether the 
Department of Veterans Affairs will comply with the request. Upon 
determination to comply or deny the request the person making the 
request will be notified immediately of the determination and the 
reasons therefor, and of the right of the person to appeal to the 
Secretary of Veterans Affairs any adverse determination. Records to be 
furnished will be supplied promptly.
    (c) Upon receipt of such an appeal from an adverse determination it 
will be evaluated and a further determination made within 20 days 
(excepting Saturdays, Sundays, and legal public holidays) after receipt 
of the appeal. If on appeal the denial is in whole or in part upheld the 
Department of Veterans Affairs will notify the requester of the 
provisions for judicial review of this determination. (See Sec. Sec. 
1.557 and 1.558.)
    (d) In unusual circumstances, specifically as follows, the time 
limits in paragraphs (b) and (c) of this section may be extended by 
written notice to the requester setting forth the reasons for such 
extension and the date on which a determination is expected to be 
dispatched. The date specified will not result in an extension for more 
than 10 working days. Unusual circumstances will be interpreted to mean, 
but only to the extent reasonably necessary to the proper processing of 
the particular request, as follows:
    (1) The need to search for and collect the requested records from 
field facilities or other establishments that are separate from the 
office processing the request;
    (2) The need to search for, collect, and appropriately examine a 
voluminous amount of separate and distinct records which are demanded in 
a single request; or
    (3) The need for consultation, which shall be conducted with all 
practicable speed, with another agency having a substantial interest in 
the determination of the request or among two or more components of the 
Department of Veterans Affairs having substantial subject-matter 
interest therein.
    (e) Pursuant to section 552(a)(6), title 5 U.S.C., any person making 
a request to the Department of Veterans Affairs for records under 
section 552(a) (1), (2) or (3) (see Sec. Sec. 1.551, 1.552 and 1.553) 
will be deemed to have exhausted his or her administrative remedies with 
respect to such request if the Department of Veterans Affairs fails to 
comply with the applicable time limit provisions of

[[Page 57]]

this section. If, however, the Government can show exceptional 
circumstances exist and that the Department of Veterans Affairs is 
exercising due diligence in responding to the request, the statute also 
permits the court to retain jurisdiction and allow the Department of 
Veterans Affairs additional time to complete its review of the records.
    (f) Requests for the release of information from files, records, 
reports, and other papers and documents in Department of Veterans 
Affairs custody pertaining to claims under any of the laws administered 
by the Department of Veterans Affairs (covered by Sec. Sec. 1.500 
through 1.527) may also be initiated under 5 U.S.C. 552. Such requests 
will also be evaluated, a determination made within 10 days (excepting 
Saturdays, Sundays, and legal public holidays) after the receipt of the 
request whether the Department of Veterans Affairs will comply with the 
request, and the requester notified immediately of the determination and 
the reasons therefor, and of the right of the person to appeal to the 
Secretary of Veterans Affairs any adverse determination. Records to be 
furnished will be supplied promptly.

[40 FR 12657, Mar. 20, 1975]



Sec. 1.554  Exemptions from public access to agency records.

    (a) The exemptions in this paragraph constitute authority to 
withhold from disclosure certain categories of information in Department 
of Veterans Affairs records except that any reasonably segregable 
portion of a record shall be provided to any person requesting such 
record after deletion of the portions which are exempt under this 
paragraph.
    (1) Specifically authorized under criteria established by an 
Executive order to be kept secret in the interest of the national 
defense or foreign policy, and are in fact properly classified pursuant 
to such Executive order.
    (2) Related solely to internal Department of Veterans Affairs 
personnel rules and practices.
    (3) Specifically exempted from disclosure by statute other than 5 
U.S.C. 552b, provided that such statute:
    (i) Requires that the matters be withheld from the public in such a 
manner as to leave no discretion on the issue, or
    (ii) Establishes particular criteria for withholding or refers to 
particular types of matters to be withheld.
    (4) Trade secrets and commercial or financial information obtained 
from any person and privileged or confidential.
    (5) Interagency or intra-agency memorandums or letters which would 
not be available by law to a private party in litigation with the 
Department of Veterans Affairs.
    (6) Personnel and medical files and similar files the disclosure of 
which would constitute a clearly unwarranted invasion of personal 
privacy.
    (7) Records or information compiled for law enforcement purposes, 
but only to the extent that the production of such law enforcement 
records or information:
    (i) Could reasonably be expected to interfere with enforcement 
proceedings;
    (ii) Would deprive a person of a right to a fair trial or an 
impartial adjudication;
    (iii) Could reasonably be expected to constitute an unwarranted 
invasion of personal privacy;
    (iv) Could reasonably be expected to disclose the identity of a 
confidential source, including a State, local or foreign agency or 
authority or any private institution which furnished information on a 
confidential basis, and, in the case of a record or information compiled 
by a criminal law enforcement authority in the course of a criminal 
investigation, or by an agency conducting a lawful national security 
intelligence investigation, information furnished by a confidential 
source;
    (v) Would disclose techniques and procedures for law enforcement 
investigations or prosecutions, or would disclose guidelines for law 
enforcement investigations or prosecutions if such disclosure could 
reasonably be expected to risk circumvention of the law, or

[[Page 58]]

    (vi) Could reasonably be expected to endanger the life or physical 
safety of any individual.


(Authority: 5 U.S.C. 552(b)(7))

    (8) Contained in or related to examination, operating, or condition 
reports prepared by, on behalf of, or for the use of any agency 
responsible for the regulation or supervision of financial institutions.
    (9) Geological and geophysical information and data (including maps) 
concerning wells.
    (b) Information in the categories exempted under paragraph (a) of 
this section, other than in paragraph (a)(3) which is applicable to 
Department of Veterans Affairs claimant records, will be released only 
as authorized in Sec. 1.550. The release of information from Department 
of Veterans Affairs claimant records will be made only in accordance 
with Sec. Sec. 1.501 through 1.526.
    (c)(1) Whenever a request is made which involves access to records 
described in paragraph (a)(7)(i) of this section and
    (i) The investigation or proceeding involves a possible violation of 
criminal law, and
    (ii) There is reason to believe that
    (A) The subject of the investigation or proceeding is not aware of 
its pendency, and
    (B) Disclosure of the existence of the records could reasonably be 
expected to interfere with enforcement proceedings, the Agency may, 
during only such time as that circumstance continues, treat the records 
as not subject to the requirements of this section.
    (2) Whenever informant records maintained by a criminal law 
enforcement agency under an informant's name or personal identifier are 
requested by a third party according to the informant's name or personal 
identifier, the Department may treat the records as not subject to the 
requirements of this section unless the informant's status as an 
informant has been officially confirmed.

(Authority: 5 U.S.C. 552(c)(1) and (c)(2))

[32 FR 10850, July 25, 1967, as amended at 40 FR 12657, Mar. 20, 1975; 
42 FR 37976, July 26, 1977; 53 FR 9442, Mar. 23, 1988]



Sec. 1.554a  Predisclosure notification procedures for confidential commercial information.

    (a) General. During the conduct of its business the Department of 
Veterans Affairs (VA) may acquire records which contain confidential 
commercial information, as defined in paragraph (b) of this section. 
Such records will not be released in response to a Freedom of 
Information Act (FOIA) request, except under the provisions of this 
section. This section establishes uniform VA procedures for giving 
submitters predisclosure notice of requests for their records which 
contain confidential commercial information that may be exempt from 
disclosure under 38 CFR 1.554(a)(4). These procedures are required by 
Executive Order 12600, Predisclosure Notification Procedures for 
Confidential Commercial Information, dated June 23, 1987.
    (b) Definitions--(1) Confidential commercial information means 
records provided to the government by a submitter that arguably contain 
material exempt from release under Exemption 4 of the FOIA, 5 U.S.C. 552 
(b)(4), as implemented by Sec. 1.554 of this part, because disclosure 
could reasonably be expected to cause substantial competitive harm.
    (2) Submitter means any person or entity who provides confidential 
commercial information to the government. The term ``submitter'' 
includes, but is not limited to corporations, State governments, and 
foreign governments.
    (c) Notification to submitters of confidential commercial 
information. When a request is received, for a submitter's record(s), or 
information which contains confidential commercial information, and the 
request is being processed under the FOIA, 5 U.S.C. 552, the submitter 
will be promptly notified in writing of the request when required by 
paragraph (d) of this section. The notification will advise the 
submitter that a request for its record(s) has been received and is 
being processed under the FOIA. The notice will describe the exact 
nature of the record(s) requested or will provide to the submitter 
copies of the record(s) or portions thereof containing the requested 
confidential commercial information. It will also inform the submitter 
of the opportunity

[[Page 59]]

to object to the disclosure in writing within 10 working days, and of 
the requirements for such a written objection, as described in paragraph 
(f) of this section. The notification will be sent by certified mail, 
return receipt requested.
    (d) When notification is required. (1) For confidential commercial 
information submitted to VA prior to January 1, 1988, notification to 
submitters is required whenever:
    (i) The records are less than 10 years old and the requested 
information has been designated by the submitter as confidential 
commercial information; or
    (ii) VA facility, administration, or staff office which has custody 
of the requested records has reason to believe that disclosure of the 
requested information could reasonably be expected to cause substantial 
competitive harm.
    (2) For confidential commercial information submitted to VA on or 
after January, 1, 1988, notification is required whenever:
    (i) The submitter has in good faith designated the requested records 
as confidential information in accordance with paragraph (e) of this 
section; or
    (ii) VA facility, administration, or staff office which has custody 
of the requested records has reason to believe that disclosure could 
reasonably be expected to cause substantial competitive harm.
    (e) Designation by submitters of information as confidential 
commercial information. (1) When business records are provided to VA, 
the submitter may appropriately designate any records or portions 
thereof which contain confidential commercial information, the 
disclosure of which could reasonably be expected to cause substantial 
competitive harm. This designation may be made at the time the 
information or record is given to VA or within a reasonable period of 
time thereafter, but not later than 60 days after receipt of the 
information by VA. Information so designated will be clearly identified 
by marking it with the words ``confidential commercial information'' or 
by an accompanying detailed written description of the specific kinds of 
information that is designated. If a complete document or record is 
designated, the cover page of the document or record will be clearly 
marked ``This entire (document, record, etc.) consists of confidential 
commercial information.'' If only portions of documents are designated, 
only those specific designated portions will be conspicuously annotated 
as ``confidential commercial information.''
    (2) A designation described in paragraph (e)(1) of this section will 
remain in effect for a period of not more than 10 years after submission 
to VA, unless the submitter provides acceptable justification for a 
longer specific period. If a shorter designation period is adequate, the 
submitter's designation should include the earlier expiration date. 
Whenever possible, the submitter's designation should be supported by a 
statement or certification by an officer or authorized representative of 
the submitter that the records are in fact confidential commercial 
information and have not been published or made available to the public.
    (f) Opportunity to object to disclosure. (1) When notification to a 
submitter is made pursuant to paragraph (c) of this section, the 
submitter or designee may object to the disclosure of any specified 
portion of the record(s). Such objection will be in writing, will be 
addressed to the VA official who provided notice, will identify the 
specific record(s) or portion(s) of records that should not be 
disclosed, will specify all grounds upon which disclosure is opposed, 
and will explain in detail why the information is considered to be a 
trade secret or confidential commercial information, i.e., why 
disclosure of the specified records could reasonably be expected to 
cause substantial competitive harm. Information provided by a submitter 
pursuant to this paragraph may itself be subject to disclosure under the 
FOIA.
    (2) Any objection to disclosure must be submitted within 10 working 
days after receipt by the submitter of notification as provided for in 
paragraph (c) of this section.
    (3) If an objection to disclosure is received within the 10 working 
day time period, careful consideration will be

[[Page 60]]

given to all specified grounds for nondisclosure prior to making an 
administrative determination whether to disclose the record. When it is 
determined to disclose the requested record(s) or portions of records 
which are the subject of an objection, the submitter will be provided a 
written statement of the VA decision, the reason(s) that the submitter's 
objections to disclosure were overruled, a description or copy of the 
exact information or record(s) to be disclosed which were the subject of 
an objection, and the specified date of disclosure. The date of 
disclosure will not be less than 10 working days from the date this 
notice is placed into mail delivery channels.
    (g) Notices to requester. (1) When a request is received for records 
that may contain confidential commercial information protected by FOIA 
exemption (b)(4), 5 U.S.C. 552(B)(4), the requester will be notified 
that the request is being processed under the provisions of this 
regulation and, as a consequence, there may be a delay in receiving a 
response.
    (2) Whenever a submitter is notified, pursuant to paragraph (c) of 
this section, that VA has received a request for records which had been 
provided by such submitter, and that such request was being processed 
under the FOIA, the requester will be notified that the submitter is 
being provided an opportunity to comment on the request. The notice to 
the requester should not include any of the specific information 
contained in the records being requested.
    (3) Whenever VA notifies a submitter of a final decision, the 
requester will also be notified by separate correspondence. This 
notification to the requester may be contained in VA's FOIA decision.
    (h) Notices of lawsuit. Whenever a FOIA requester brings suit 
seeking to compel disclosure of confidential commercial information, the 
submitter of the information will be promptly notified.
    (i) Exceptions to the notification requirements. The predisclosure 
notification requirements in paragraph (c) of this section need not be 
followed if:
    (1) It is determined that the record(s) or information should not be 
disclosed;
    (2) The record(s) requested have been published or have been 
officially made available to the public;
    (3) Disclosure of the record(s) or information is required by law 
(other than the FOIA, 5 U.S.C. 552);
    (4) Disclosure is required by an Agency rule that:
    (i) Was adopted pursuant to notice and public comment;
    (ii) Specifies narrow classes of records submitted to VA that are to 
be released under the FOIA; and
    (iii) Provides in exceptional circumstances for notice when the 
submitter provides written justification, at the time the information is 
submitted or a reasonable time thereafter, that disclosure of the 
information could reasonably be expected to cause substantial 
competitive harm;
    (5) The record(s) requested are not designated by the submitter as 
exempt from disclosure in accordance with paragraph (e) of this section, 
and the submitter had an opportunity to do so at the time of submission 
of the record(s) or a reasonable time thereafter, and VA does not have 
substantial reason to believe that disclosure of the information would 
result in competitive harm; or
    (6) The designation made by the submitter in accordance with 
paragraph (e) of this section appears obviously frivolous, except that, 
in such case, VA must still provide the submitter with advance written 
notice of any final administrative disclosure determination not less 
than 10 working days prior to the specified disclosure date.

(Approved by the Office of Management and Budget under control number 
2900-0393)

(Authority: 38 U.S.C. 501; 5 U.S.C. 552(b)(4): E.O. 12600 (52 FR 23781))

[57 FR 2229, Jan. 21, 1992]



Sec. 1.555  Fees.

    (a) Definitions of terms. For the purpose of this section, the 
following definitions apply:
    (1) Commercial use request means a request from or on behalf of one 
who seeks information for a use or purpose that furthers the commercial, 
trade or profit interests of the requester or the person on whose behalf 
the request is made. To determine whether a request

[[Page 61]]

properly belongs in this category, consideration must be given to the 
use to which a requester will put the documents requested. Where the use 
of the records sought is not clear in the request or where there is 
reasonable cause to doubt the use to which the requester will put the 
records sought, additional information may be sought from the requester 
before assigning the request to a specific category.
    (2) Direct costs means those expenditures which VA actually incurs 
in searching for and duplicating (and in the case of commercial use 
requests, reviewing) documents to respond to a Freedom of Information 
Act (FOIA) request. Direct costs include, for example, the salary of the 
employee performing work, i.e., the basic rate of pay for the employee, 
plus 16 percent of that rate to cover benefits, and the cost of 
operating duplicating machinery. Not included in direct costs are 
overhead expenses such as costs of space, and heating or lighting of the 
facility in which the records are stored.
    (3) Duplication means the process of making a copy of a document 
necessary to respond to a FOIA request. Such copies can take the form of 
paper copy, microform, audiovisual materials or machine readable 
documentation (e.g., magnetic tape or disk), among others. The copy 
provided must be in a form that is reasonably usable by requesters.
    (4) Educational institution means a preschool, a public or private 
elementary or secondary school, an institution of graduate higher 
education, an institution of undergraduate higher education, an 
institution of professional education, and an institution of vocational 
education, which operates a program or programs of scholarly research. 
To determine whether a request properly belongs in this category, the 
request must be evaluated to ensure that it is apparent from the nature 
of the request that it serves a scholarly research goal of the 
institution, rather than an individual goal of the requester or a 
commercial goal of the institution.
    (5) Non-commercial scientific institution means an institution that 
is not operated on a commercial basis (as that term is referenced under 
Commercial use request of this paragraph) and which is operated solely 
for the purpose of conducting scientific research, the results of which 
are not intended to promote any particular product or industry.
    (6) Representative of the news media means any person actively 
gathering news for an entity that is organized and operated to publish 
or broadcast news to the public. The term news means information that is 
about current events or that would be of current interest to the public. 
Examples of news media entities include television or radio stations 
broadcasting to the public at large, and publishers of periodicals (but 
only in those instances when they can qualify as disseminators of news) 
who make their products available for purchase or subscription by the 
general public. These examples are not intended to be all inclusive. As 
traditional methods of news delivery evolve (e.g., electronic 
dissemination of newspapers through telecommunications services), such 
alternative media will be included in this category. Freelance 
journalists may be regarded as working for a news organization if they 
can demonstrate a solid basis for expecting publication through that 
organization, even though not actually employed by it. A publication 
contract would be the clearest proof, but the requester's past 
publication history can be considered also. In any case, freelancers who 
do not qualify for inclusion in the representative of the news media 
category may seek a reduction or waiver of fees under paragraph (f) of 
this section.
    (7) Review means the process of examining documents located in 
response to a commercial use request (see definition of commercial use 
request in this section) to determine whether any portion of any 
document located is permitted to be withheld. It also includes 
processing any documents for disclosure in response to a commercial use 
request, e.g., doing all that is necessary to excise them and otherwise 
prepare them for release. The term review does not include time spent 
resolving general legal or policy issues regarding the application of 
exemptions.
    (8) Search means all the time spent looking for material that is 
responsive to a request, including page-by-page or

[[Page 62]]

line-by-line identification of material within documents. Searches may 
be done manually or by computer using existing programs. The most 
efficient and least expensive manner of searching for material will be 
used to minimize costs to VA and the requester. For example, line-by-
line searches will not be conducted when duplicating an entire document 
is the least expensive and quicker method of complying with a request. 
The term search does not cover the time spent to review documents to 
determine whether all or portions thereof can be withheld under one of 
the nine categories of exemptions identified in Sec. 1.554 of this 
part.
    (b) Fees to be charged. (1) Except as provided in paragraphs (c), 
(d), (f) and (g) of this section, the Department of Veterans Affairs 
will charge fees that recoup the full allowable direct costs for 
responding to each request from the public. Such fees will be charged in 
accordance with the schedule of fees in paragraph (e) of this section, 
and other requirements or restrictions in this regulation. The most 
efficient and least costly methods will be used to comply with requests 
for documents made under the FOIA.
    (2) If it is estimated that charges for duplication determined by 
using the fee schedule in Sec. 1.555(e) of this part are likely to 
exceed $25, the requester will be notified of the estimated amount of 
fees, unless the requester has indicated in advance his or her 
willingness to pay fees as high as those anticipated. Such notice will 
offer the requester the opportunity to confer with Department personnel 
with the object of reformulating the request to meet his or her needs at 
a lower cost.
    (3) Each administration and staff office upon approval of the 
Secretary is authorized to contract with private sector services to 
locate, reproduce, and disseminate records in response to FOIA requests 
when that is the most efficient and least costly method. If a contractor 
is used, the ultimate cost to the requester can be no greater than it 
would if the administration, staff office, or field facility performed 
the task, itself. In no case may an administration, staff office, or 
field facility contract out responsibilities which the FOIA provides 
that they alone may discharge, such as determining the applicability of 
an exemption, or determining whether to waive or reduce fees.
    (4) When documents that would be responsive to a request are 
maintained for distribution by agencies operating statutory-based fee 
schedule programs, in which the agency is required to set the level of 
fees for particular types of records, such as the National Technical 
Information Service or the Government Printing Office, the requester of 
such documents will be informed of the steps necessary to obtain records 
from those sources, rather than from VA.
    (c) Restrictions on assessing fees. With the exception of commercial 
use requests no charges will be assessed for the first 100 pages of 
duplication and the first two hours of search time. Moreover, no fees 
are to be charged any requester, including commercial use requesters, if 
the cost of collecting the fee is equal to or greater than the fee 
itself. These provisions work together so that, except for commercial 
use requests, fees will not be assessed until the free search and 
duplication have been provided. For example, if a request takes two 
hours and ten minutes of search time and results in 105 reproduced pages 
of documents, fees can be charged for only 10 minutes of search time and 
for only five pages of reproduction. If this cost were equal to or less 
than the cost to VA of billing the requester and processing the fee 
collected, no charges would be assessed. (NOTE: The cost of collecting 
fees are VA's administrative costs of receiving and recording a 
requester's remittance, and processing the fee for deposit in the 
Treasury Department's special account. The cost is determined to be 
negligible. The per-transaction costs to the Treasury to handle such 
remittances is negligible and will not be considered in the Department's 
determination.)
    (1) For purposes of the restriction on assessing fees, the word 
pages refers to one-sided paper copies of the standard sizes 8\1/
2\ x 11 or 8\1/2\ x 14 or 11 
 x 14. Accordingly, requesters will not be 
entitled to 100 microfiche or 100 computer disks free. One microfiche 
containing the equivalent of 100 pages or 100 pages

[[Page 63]]

of computer printout might meet the terms of the restriction.
    (2) The term search time in this context is based on manual 
searches. To calculate the computer search time for the purpose of 
applying the two-hour search restriction, the hourly cost of operating 
the computer's central processing unit will be combined with the 
operator's hourly salary, plus 16 percent of the salary. When the cost 
of the search (including the operator time and the cost of the computer 
to process a request) equals the equivalent dollar amount of two hours 
of the salary of the person performing the search, i.e., the operator, 
charges will begin to be assessed for a computer search.
    (d) Categories of requesters and fees to be charged each category. 
There are four categories of FOIA requesters: Commercial use requesters; 
educational and non-commercial scientific institutional requesters; 
requesters who are representatives of news media; and all other 
requesters. Specific levels of fees will be charged for each of these 
categories as follows:
    (1) Commercial use requesters. When a request for documents for 
commercial use is received, the full direct costs of searching for, 
reviewing for release, and duplicating the records sought will be 
charged to the requester. Commercial use requesters are not entitled to 
two hours of free search time nor 100 free pages of reproduced 
documents. Moreover, the commercial use requester will be charged the 
cost of searching for and reviewing records even if there is ultimately 
no disclosure of records. The requester must reasonably describe the 
records sought.
    (2) Educational and non-commercial scientific institution 
requesters. These requesters will be charged only for the cost of 
reproduction, excluding charges for the first 100 pages. In order to be 
considered a member of this category, a requester must show that the 
request is being made as authorized by and under the auspices of a 
qualifying institution and that the records are not sought for a 
commercial use. If the request is from an educational institution, the 
requester must show that the records sought are in furtherance of 
scholarly research. If the request is from a non-commercial scientific 
institution, the requester has to show that the records are sought in 
furtherance of scientific research. Information necessary to support a 
claim of being categorized as an educational or non-commercial 
scientific institution requester will be provided by the requester, and 
the requester must reasonably describe the records sought.
    (3) Representatives of news media. These requesters will be charged 
for the cost of reproduction, only, excluding charges for the first 100 
pages. To be included in this category, a requester must fall within the 
definition of a representative of the news media specified in paragraph 
(a)(vi) of this section, and the request must not be made for commercial 
use. A request for records supporting the news dissemination function of 
the requester will not be considered to be a request that is for 
commercial use. Requesters must reasonably describe the records sought.
    (4) All other requesters. Any requester that does not fit into any 
of the categories in this section will be charged fees which recover the 
full reasonable direct cost of searching for and reproducing records 
that are responsive to the request, except that the first 100 pages of 
reproduction and the first two hours of search time will be furnished 
without charge. In addition, under certain circumstances specified in 
paragraph (f) of this section, fees will be waived or reduced at the 
discretion of field facility heads, their designee, or responsible 
Central Office officials. Requests from VA beneficiaries, applicants for 
VA benefits, or other individuals for records retrievable by their name 
or other personal identifier will initially be processed under 38 U.S.C. 
5701 and 5 U.S.C. 552a and will be assessed fees in accordance with the 
applicable fee provisions of Sec. 1.526(i) or Sec. 1.577(f) of this 
part. To the extent that records are not disclosable under these 
provisions, the disclosure of such records will be evaluated under 
Sec. Sec. 1.550 through 1.559 of this part, and fees will be assessed 
under paragraph (e) of this section. Requesters must reasonably describe 
the records sought.
    (e) Schedule of fees:

[[Page 64]]



------------------------------------------------------------------------
              Activity                               Fees
------------------------------------------------------------------------
(1) Duplication of documents by any  $0.15 per page.
 type of reproduction process to
 produce plain one-sided paper
 copies of a standard size (8\1/
 2\ x 11; 8\1/
 2\ x 14;
 11 x 14).
(2) Duplication of non-paper         Actual direct cost to the Agency.
 records, such as microforms,         (See paragraph (a)(2) of this
 audiovisual materials (motion        section and, if costs are likely
 pictures, slides, laser optical      to exceed $25.00, paragraph (b)(2)
 disks, video tapes, audiotapes,      of this section.
 etc.) computer tapes and disks,
 diskettes for personal computers,
 and any other automated media
 output.
(3) Duplication of documents by any  Actual direct cost to the Agency.
 type of reproduction process not     (See paragraph (a)(2) of this
 covered by paragraphs (e)(1) and     section and, if costs are likely
 (2) of this section to produce a     to exceed $25.00, paragraph (b)(2)
 copy in a form reasonably usable     of this section.
 by the requester.
(4) Document search by manual (non-  Basic hourly salary rate of the
 automated) methods.                  employee(s) performing the search,
                                      plus 16 percent. (If costs are
                                      likely to exceed $25.00, see
                                      paragraph (g)(2) of this section.)
 
(Note--If a department, staff office or field station uses exclusively a
 single class of personnel, e.g., all administrative/clerical or all
 professional/executive, an average rate for the range of grades
 involved may be used).
 
(5) Document search using automated  Actual direct cost to perform
 methods, such as by computer.        search. (See paragraph (c)(2) of
                                      this section, and, if costs are
                                      likely to exceed $25.00, see
                                      paragraph (g)(2) of this section.)
(6) Document review (use only for    Basic hourly salary rate of
 commercial use requesters).          employee(s) performing initial
                                      review to determine whether to
                                      release document(s) or portions of
                                      records, plus 16 percent.
 
(Note. Charge for document reviews covers only the time spent reviewing
 the document(s) at the initial administrative level to determine
 applicability of a specific FOIA exemption to a particular record or
 portion of a record. It does not cover any review incurred at the
 administrative appeal level once the initial exemptions are applied.
 However, records or portions of records withheld in full under an
 exemption which is subsequently determined not to apply may be reviewed
 again to determine the applicability of other exemptions not previously
 considered. The cost for such a subsequent review may be properly
 assessed).
 
(7) Other charges: Certifying that   Where applicable, assess under
 records are true copies; Sending     provisions of Sec. Sec.
 records by special methods such as   1.526(i) and (j) of this part,
 express mail.                        otherwise actual direct cost of
                                      service performed.
------------------------------------------------------------------------

    (f) Waiving or reducing fees. (1) Fees for records and services 
provided in response to a FOIA request will be waived or reduced when it 
is determined by responsible Central Office officials or field station 
heads or their designee that furnishing the document(s) is in the public 
interest because it is likely to contribute significantly to public 
understanding of the operations or activities of the government and is 
not primarily in the commercial interest of the requester.
    (2) The following factors will be considered in sequence in 
determining whether disclosure of information is in the public interest 
because it is likely to contribute significantly to the public 
understanding of the operations or activities of the government:
    (i) The subject of the request: Whether the subject of the requested 
records concerns the operations or activities of the government;
    (ii) The informative value of the information to be disclosed: 
Whether the disclosure is likely to contribute to an understanding of 
government operations or activities;
    (iii) The contribution to an understanding of the subject by the 
public likely to result from disclosure: Whether disclosure of the 
requested information will contribute to public understanding; and
    (iv) The significance of the contribution to public understanding: 
Whether the disclosure is likely to contribute significantly to public 
understanding of government operations or activities.

[[Page 65]]

    (3) The following factors will be considered in sequence in 
determining whether disclosure of information is primarily in the 
commercial interest of the requester:
    (i) The existence and magnitude of a commercial interest: Whether 
the requester has a commercial interest that would be furthered by the 
requested disclosure; and, if so
    (ii) The primary interest in disclosure: Whether the magnitude of 
the identified commercial interest of the requester is sufficiently 
large, in comparison with the public interest in disclosure, that 
disclosure is primarily in the commercial interest of the requester.
    (4) An appeal from an adverse fee waiver or reduction determination 
will be processed in the same manner as described in Sec. 1.557 of this 
part.
    (g) Other administrative considerations to improve assessment and 
collection of fees--(1) Charging interest--notice and rate. The 
Department of Veterans Affairs may charge interest to those requesters 
who fail to timely pay fees assessed in accordance with these 
regulations. Determination to charge interest will be made by the 
responsible Central Office official or field facility head or designee. 
Interest will be assessed on the unpaid bill beginning on the 31st day 
following the day on which the original building was sent. Interest will 
be at the rate prescribed in section 3717 of title 31 U.S.C., and will 
accrue from the date of the billing. Accounting procedures ensure that a 
requester who has remitted the full amount within the time period is 
properly credited with the payment. The fact that the fee has been 
received by VA, even if not processed, will suffice to stay the accrual 
of interest.
    (2) Charges for unsuccessful search. When it is determined by the 
responsible Central Office official or field facility head or designee, 
charges for searching may be assessed, even if records are not located 
to satisfy a request or if records located are determined to be exempt 
from disclosure. If it is determined that search charges are likely to 
exceed $25, the requester will be notified of the estimated amount of 
fees, unless the requester has indicated in advance a willingness to pay 
fees as high as those anticipated. Such notice will offer the requester 
the opportunity to confer with agency personnel with the object of 
reformulating the request to meet his or her needs at a lower cost.
    (3) Aggregating requests. When the responsible Central Office 
official or field facility head or designee reasonably believes that a 
requester or, on rare occasions, a group of requesters acting in 
concert, is attempting to break a request down into a series of requests 
for the purpose of evading the assessment of fees, the responsible 
Central Office official, or field facility head or designee may 
aggregate (combine) any such requests and charge accordingly. One 
element to consider in determining whether a belief would be reasonable 
is the time period in which the requests occurred. For example, it is 
reasonable to presume that multiple requests within a 30-day time period 
that seek portion(s) of the same document(s) is an attempt to avoid 
payment of charges. For requests made over a longer period, however, 
such presumption becomes harder to sustain. In each case, there must be 
a solid basis for determining that aggregation is warranted. Caution 
will be exercised before aggregating requests from more than one 
requester. There must be a concrete basis on which to conclude that the 
requesters are acting in concert and are acting specifically to avoid 
payment. In no case will multiple requests on unrelated subjects from 
one requester be aggregated.
    (4) Advance payments. The Department of Veterans Affairs may not 
require a requester to make an advance payment, i.e., payment before 
work is commenced or continued on a request, unless:
    (i) The allowable charges that a requester may be required to pay 
are likely to exceed $250. Then, the Department of Veterans Affairs 
should either notify the requester of the likely cost and obtain 
satisfactory assurance of full payment, or require an advance payment of 
an amount up to the full estimated charges in the case of requesters 
with no history of payment; or
    (ii) A requester has previously failed to pay a fee charged in a 
timely fashion

[[Page 66]]

(i.e., within 30 days of the date of the billing). Then, the Department 
of Veterans Affairs may require the requester to pay the full amount 
owed, plus any applicable interest as provided in paragraph (g)(1) of 
this section, or to demonstrate that he or she has, in fact, paid the 
fee, and to make an advance payment of the estimated fee before the 
Department begins to process a new request or a pending request from 
that requester.
    (iii) If a requester is required to make advance payments, as 
described in this section, the time limits prescribed in Sec. 1.553a of 
this part, for responding to initial requests and appeals from initial 
denials, will begin only after the Department has received the advance 
fee payments.
    (5) Debt collection. In the event of non-payment of billed charges 
for disclosure of records, the procedures authorized by the Debt 
Collection Act of 1982 (Pub. L. 97-365) may be used. This may include 
disclosure to consumer reporting agencies and use of collection 
agencies.

(Authority: 5 U.S.C. 552(a)(4)(A))

[53 FR 10377, Mar. 31, 1988]



Sec. 1.556  Requests for other reasonably described records.

    Each administration, staff office, and field facility head will 
designate an employee(s) who will be responsible for initial action on 
(granting or denying) requests to inspect or obtain information from or 
copies of records under their jurisdiction and within the purview of 
Sec. 1.553. This responsibility includes maintaining a uniform listing 
of such requests. Data logged will consist of: Name and address of 
requester; date of receipt of request; brief description of request; 
action taken on request, granted or denied; citation of the specific 
section when request is denied; and date of reply to the requester. In 
the field a denial of any such request may be made only by the Director 
or the designated employee and in Central Office only by the 
administration or staff office head or designee. The letter notifying 
the requester of the denial will be signed by the official making the 
denial decision. Any legal question arising in a field station 
concerning the release of information will be referred to the 
appropriate Regional Counsel for disposition as contemplated by Sec. 
13.401* of this chapter. In Central Office such legal questions will be 
referred to the General Counsel. Any administrative question will be 
referred through administrative channels to the appropriate 
administration or staff office head. All denials or proposed denials at 
the Central Office level will be coordinated with the Director, 
Information Service as well as the General Counsel.
---------------------------------------------------------------------------

    *Editorial Note: At 42 FR 41410, Aug. 17, 1977, Sec. 13.401 was 
removed.

[40 FR 12658, Mar. 20, 1975]



Sec. 1.557  Administrative review.

    (a) Upon denial of a request, the responsible Department of Veterans 
Affairs official or designated employee will inform the requester in 
writing of the denial, cite the specific exemption in Sec. 1.554 upon 
which the denial is based, set forth the names and titles or positions 
of each person responsible for the denial of such request, and advise 
that the denial may be appealed to the General Counsel.
    (b) The final agency decision in such appeals will be made by the 
General Counsel or the Deputy General Counsel.

[40 FR 12658, Mar. 20, 1975, as amended at 55 FR 21546, May 25, 1990]



Sec. Sec. 1.558-1.559  [Reserved]

  Safeguarding Personal Information in Department of Veterans Affairs 
                                 Records

    Note: Sections 1.575 through 1.584 concern the safeguarding of 
individual privacy from the misuse of information from files, records, 
reports, and other papers and documents in Department of Veterans 
Affairs custody. As to the release of information from Department of 
Veterans Affairs claimant records see Sec. 1.500 series. As to the 
release of information from Department of Veterans Affairs records other 
than claimant records see Sec. 1.550 series. Section 1.575 series 
implement the provisions of Pub. L. 93-579, December 31, 1974, adding a 
section 552a to title 5 U.S.C. providing that individuals be granted 
access to records concerning them which are maintained by Federal 
agencies, and for other purposes.

[[Page 67]]


    Source: 40 FR 33944, Aug. 12, 1975, unless otherwise noted.



Sec. 1.575  Social security numbers in veterans' benefits matters.

    (a) Except as provided in paragraph (b) of this section, no one will 
be denied any right, benefit, or privilege provided by law because of 
refusal to disclose to the Department of Veterans Affairs a social 
security number.
    (b) VA shall require mandatory disclosure of a claimant's or 
beneficiary's social security number (including the social security 
number of a dependent of a claimant or beneficiary) on necessary forms 
as prescribed by the Secretary as a condition precedent to receipt or 
continuation of receipt of compensation or pension payable under the 
provisions of chapters 11, 13 and 15 of title 38, United States Code, 
provided, however, that a claimant shall not be required to furnish VA 
with a social security number for any person to whom a social security 
number has not been assigned. VA may also require mandatory disclosure 
of an applicant's social security number as a condition for receiving 
loan guaranty benefits and a social security number or other taxpayer 
identification number from existing direct and vendee loan borrowers and 
as a condition precedent to receipt of a VA-guaranteed loan, direct loan 
or vendee loan, under chapter 37 of title 38, United States Code. (Pub. 
L. 97-365, sec. 4)
    (c) A person requested by VA to disclose a social security number 
shall be told, as prescribed by Sec. 1.578(c), whether disclosure is 
voluntary or mandatory. The person shall also be told that VA is 
requesting the social security number under the authority of title 38 
U.S.C., or in the case of existing direct or vendee loan borrowers, 
under the authority of 26 U.S.C. 6109(a) in conjunction with sections 
145 and 148 of Pub. L. 98-369, or in the case of loan applicants, under 
the authority of section 4 of Pub. L. 97-365. The person shall also be 
told that it will be used in the administration of veterans' benefits in 
the identification of veterans or persons claiming or receiving VA 
benefits and their records, that it may be used in making reports to the 
Internal Revenue Service where required by law, and to determine whether 
a loan guaranty applicant has been identified as a delinquent taxpayer 
by the Internal Revenue Service, and that such taxpayers may have their 
loan applications rejected, and that it may be used to verify social 
security benefit entitlement (including amounts payable) with the Social 
Security Administration and, for other purposes where authorized by both 
title 38 U.S.C., and the Privacy Act of 1974, (Pub. L. 93-579), or, 
where required by another statute. (Pub. L. 97-365, sec. 4)

(Authority: 38 U.S.C. 5101)

[44 FR 22068, Apr. 13, 1979, as amended at 51 FR 21750, June 16, 1986; 
56 FR 25044, June 3, 1991]



Sec. 1.576  General policies, conditions of disclosure, accounting of certain disclosures, and definitions.

    (a) The Department of Veterans Affairs will safeguard an individual 
against an invasion of personal privacy. Except as otherwise provided by 
law or regulation its officials and employees will:
    (1) Permit an individual to determine what records pertaining to him 
or her will be collected, maintained, used, or disseminated by the 
Department of Veterans Affairs.
    (2) Permit an individual to prevent records pertaining to him or 
her, obtained by the Department of Veterans Affairs for a particular 
purpose, from being used or made available for another purpose without 
his or her consent.
    (3) Permit an individual to gain access to information pertaining to 
him or her in Department of Veterans Affairs records, to have a copy 
made of all or any portion thereof, and to correct or amend such 
records.
    (4) Collect, maintain, use, or disseminate any record of 
identifiable personal information in a manner that assures that such 
action is for a necessary and lawful purpose, that the information is 
correct and accurate for its intended use, and that adequate safeguards 
are provided to prevent misuse of such information.
    (5) Permit exemptions from records requirements provided in 5 U.S.C. 
552a only where an important public policy

[[Page 68]]

need for such exemption has been determined pursuant to specific 
statutory authority.
    (b) The Department of Veterans Affairs will not disclose any record 
contained in a system of records by any means of communication to any 
person or any other agency except by written request of or prior written 
consent of the individual to whom the record pertains unless such 
disclosure is:
    (1) To those officers and employees of the agency which maintains 
the record and who have a need for the record in the performance of 
their duties;
    (2) Required under 5 U.S.C. 552;
    (3) For a routine use of the record compatible with the purpose for 
which it was collected;
    (4) To the Bureau of the Census for purposes of planning or carrying 
out a census or survey or related activity pursuant to title 13 U.S.C.;
    (5) To a recipient who has provided the Department of Veterans 
Affairs with advance adequate written assurance that the record will be 
used solely as a statistical research or reporting record, and the 
record is to be transferred in a form that is not individually 
identifiable;
    (6) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the U.S. Government, or for evaluation by the 
Administrator of General Services or designee to determine whether the 
record has such value;
    (7) To another agency or to an instrumentality of any governmental 
jurisdiction within or under the control of the United States for a 
civil or criminal law enforcement activity if the activity is authorized 
by law, and if the head of the agency or instrumentality has made a 
written request to the Department of Veterans Affairs specifying the 
particular portion desired and the law enforcement activity for which 
the record is sought;
    (8) To a person pursuant to a showing of compelling circumstances 
affecting the health or safety of an individual if upon such disclosure 
notification is transmitted to the last known address of such 
individual;
    (9) To either House of Congress, or, to the extent of matter within 
its jurisdiction, any committee or subcommittee thereof, any joint 
committee of Congress or subcommittee of any such joint committee;
    (10) To the Comptroller General, or any authorized representatives, 
in the course of the performance of the duties of the General Accounting 
Office; or
    (11) Pursuant to the order of a court of competent jurisdiction.
    (c) With respect to each system of records (i.e., a group of records 
from which information is retrieved by the name of the individual or by 
some identifying number, symbol, or other identifying particular 
assigned to the individual) under Department of Veterans Affairs 
control, the Department of Veterans Affairs will (except for disclosures 
made under paragraph (b)(1) or (2) of this section) keep an accurate 
accounting as follows:
    (1) For each disclosure of a record to any person or to another 
agency made under paragraph (b) of this section, maintain information 
consisting of the date, nature, and purpose of each disclosure, and the 
name and address of the person or agency to whom the disclosure is made;
    (2) Retain the accounting made under paragraph (c)(1) of this 
section for at least 5 years or the life of the record, whichever is 
longer, after the disclosure for which the accounting is made;
    (3) Except for disclosures made under paragraph (b)(7) of this 
section, make the accounting under paragraph (c)(1) of this section 
available to the individual named in the record at his or her request; 
and
    (4) Inform any person or other agency about any correction or 
notation of dispute made by the agency in accordance with Sec. 1.579 of 
any record that has been disclosed to the person or agency if an 
accounting of the disclosure was made.
    (d) For the purposes of Sec. Sec. 1.575 through 1.584, the parent 
of any minor, or the legal guardian of any individual who has been 
declared incompetent due to physical or mental incapacity or age by a 
court of competent jurisdiction, may act on behalf of the individual.
    (e) Section 552a(i), title 5 U.S.C., provides that:
    (1) Any officer or employee of the Department of Veterans Affairs, 
who by

[[Page 69]]

virtue of his or her employment or official position, has possession of, 
or access to, Department of Veterans Affairs records which contain 
individually identifiable information the disclosure of which is 
prohibited by 5 U.S.C. 552a or by Sec. 1.575 series established 
thereunder, and who knowing that disclosure of the specific material is 
so prohibited, willfully discloses the material in any manner to any 
person or agency not entitled to receive it, shall be guilty of a 
misdemeanor and fined not more than $5,000.
    (2) Any officer or employee of the Department of Veterans Affairs 
who willfully maintains a system of records without meeting the notice 
requirements of 5 U.S.C. 552a(e)(4) (see Sec. 1.578(d)) shall be guilty 
of a misdemeanor and fined not more than $5,000.
    (3) Any person who knowingly and willfully requests or obtains any 
record concerning an individual from the Department of Veterans Affairs 
under false pretenses shall be guilty of a misdemeanor and fined not 
more than $5,000.
    (f) For purposes of Sec. 1.575 series the following definitions 
apply:
    (1) The term agency includes any executive department, military 
department, Government corporation, Government controlled corporation, 
or other establishment in the executive branch of the government 
(including the Executive Office of the President), or any independent 
regulatory agency.
    (2) The term individual means a citizen of the United States or an 
alien lawfully admitted for permanent residence.
    (3) The term maintain includes maintain, collect, use, or 
disseminate.
    (4) The term record means any item, collection, or grouping of 
information about an individual that is maintained by an agency, 
including, but not limited to, his or her education, financial 
transactions, medical history, and criminal or employment history and 
that contains his or her name, or the identifying number, symbol, or 
other identifying particular assigned to the individual, such as a 
finger or voice print or a photograph.
    (5) The term system of records means a group of any records under 
the control of any agency from which information is retrieved by the 
name of the individual or by some identifying number, symbol, or other 
identifying particular assigned to the individual.
    (6) The term statistical record means a record in a system of 
records maintained for statistical research or reporting purposes only 
and not used in whole or in part in making any determination about an 
identifiable individual except as provided by section 8 of title 13 
U.S.C.
    (7) The term routine use means, with respect to the disclosure of a 
record, the use of such record for a purpose which is compatible with 
the purpose for which it was collected.
    (g) When the Department of Veterans Affairs provides by a contract 
for the operation by or on behalf of the Department of Veterans Affairs 
of a system of records to accomplish a Department of Veterans Affairs 
function, the Department of Veterans Affairs will, consistent with its 
authority, cause the requirements of 5 U.S.C. 552a (as required by 
subsection (m)) and those of the Sec. 1.575 series to be applied to 
such system. For the purposes of 5 U.S.C. 552a(i) and Sec. 1.576(e) any 
such contractor and any employee of such contractor, if such contract is 
agreed to on or after September 27, 1975, will be considered to be an 
employee of the Department of Veterans Affairs.
    (h) The Department of Veterans Affairs will, for the purposes of 5 
U.S.C. 552a, consider that it maintains any agency record which it 
deposits with the Administrator of General Services for storage, 
processing, and servicing in accordance with section 3103 of title 44 
U.S.C. Any such record will be considered subject to the provisions of 
Sec. 1.575 series implementing 5 U.S.C. 552a and any other applicable 
Department of Veterans Affairs regulations. The Administrator of General 
Services is not authorized to disclose such a record except to the 
Department of Veterans Affairs, or under regulations established by the 
Department of Veterans Affairs which are not inconsistent with 5 U.S.C. 
552a.
    (i) The Department of Veterans Affairs will, for the purposes of 5 
U.S.C. 552a, consider that a record is maintained by the National 
Archives of the

[[Page 70]]

United States if it pertains to an identifiable individual and was 
transferred to the National Archives prior to September 27, 1975, as a 
record which has sufficient historical or other value to warrant its 
continued preservation by the United States Government. Such records are 
not subject to the provisions of 5 U.S.C. 552a except that a statement 
generally describing such records (modeled after the requirements 
relating to records subject to subsections (e)(4)(A) through (G) of 5 
U.S.C. 552a) will be published in the Federal Register.
    (j) The Department of Veterans Affairs will also, for the purposes 
of 5 U.S.C. 552a, consider that a record is maintained by the National 
Archives of the United States if it pertains to an identifiable 
individual and is transferred to the National Archives on or after 
September 27, 1975, as a record which has sufficient historical or other 
value to warrant its continued preservation by the United States 
Government. Such records are exempt from the requirements of 5 U.S.C. 
552a except subsections (e)(4) (A) through (G) and (e)(9) thereof.

(Authority: 38 U.S.C. 501)

[40 FR 33944, Aug. 12, 1975, as amended at 40 FR 58644, Dec. 18, 1975; 
47 FR 16323, Apr. 16, 1982]



Sec. 1.577  Access to records.

    (a) Except as otherwise provided by law or regulation any individual 
upon request may gain access to his or her record or to any information 
pertaining to him or her which is contained in any system of records 
maintained by the Department of Veterans Affairs. The individual will be 
permitted, and upon his or her request, a person of his or her own 
choosing permitted to accompany him or her, to review the record and 
have a copy made of all or any portion thereof in a form comprehensible 
to him or her. The Department of Veterans Affairs will require, however, 
a written statement from the individual authorizing discussion of that 
individual's record in the accompanying person's presence.
    (b) Any individual will be notified, upon request, if any Department 
of Veterans Affairs system of records named contains a record pertaining 
to him or her. Such request must be in writing, over the signature of 
the requester. The request must contain a reasonable description of the 
Department of Veterans Affairs system or systems of records involved, as 
described at least annually by notice published in the Federal Register 
describing the existence and character of the Department of Veterans 
Affairs system or systems of records pursuant to Sec. 1.578(d). The 
request should be made to the office concerned (having jurisdiction over 
the system or systems of records involved) or, if not known, to the 
Director or Department of Veterans Affairs Officer in the nearest 
Department of Veterans Affairs regional office, or to the Department of 
Veterans Affairs Central Office, 810 Vermont Avenue, NW., Washington, DC 
20420. Personal contact should normally be made during the regular duty 
hours of the office concerned, which are 8:00 a.m. to 4:30 p.m., Monday 
through Friday for Department of Veterans Affairs Central Office and 
most field facilities. Identification of the individual requesting the 
information will be required and will consist of the requester's name, 
signature, address, and claim, insurance or other identifying file 
number, if any, as a minimum. Additional identifying data or documents 
may be required in specified categories as determined by operating 
requirements and established and publicized by the promulgation of 
Department of Veterans Affairs regulations. (5 U.S.C. 552a(f)(1))
    (c) The department or staff office having jurisdiction over the 
records involved will establish appropriate disclosure procedures and 
will notify the individual requesting disclosure of his or her record or 
information pertaining to him or her of the time, place and conditions 
under which the Department of Veterans Affairs will comply to the extent 
permitted by law and Department of Veterans Affairs regulation. (5 
U.S.C. 552a(f)(2))
    (d) Access to sensitive material in records, including medical and 
psychological records, is subject to the following special procedures. 
When an individual requests access to his or her records, the Department 
of Veterans

[[Page 71]]

Affairs official responsible for administering those records will review 
them and identify the presence of any sensitive records. Sensitive 
records are those that contain information which may have a serious 
adverse effect on the individual's mental or physical health if they are 
disclosed to him or her. If, on review of the records, the Department of 
Veterans Affairs official concludes that there are sensitive records 
involved, the official will refer the records to a Department of 
Veterans Affairs physician, other than a rating board physician, for 
further review. If the physician who reviews the records believes that 
disclosure of the information directly to the individual could have an 
adverse effect on the physical or mental health of the individual, the 
responsible Department of Veterans Affairs official will then advise the 
requesting individual: (1) That the Department of Veterans Affairs will 
disclose the sensitive records to a physician or other professional 
person selected by the requesting individual for such redisclosure as 
the professional person may believe is indicated, and (2) in indicated 
cases, that the Department of Veterans Affairs will arrange for the 
individual to report to a Department of Veterans Affairs facility for a 
discussion of his or her records with a designated Department of 
Veterans Affairs physician and for an explanation of what is included in 
the records. Following such discussion, the records should be disclosed 
to the individual; however, in those extraordinary cases where a careful 
and conscientious explanation of the information considered harmful in 
the record has been made by a Department of Veterans Affairs physician 
and where it is still the physician's professional medical opinion that 
physical access to the information could be physically or mentally 
harmful to the patient, physical access may be denied. Such a denial 
situation should be an unusual, very infrequent occurrence. When denial 
of a request for direct physical access is made, the responsible 
Department of Veterans Affairs official will: (1) Promptly advise the 
individual making the request of the denial; (2) state the reasons for 
the denial of the request (e.g., 5 U.S.C. 552a(f)(3), 38 U.S.C. 
5701(b)(1)); and (3) advise the requester that the denial may be 
appealed to the General Counsel and of the procedure for such an 
appeal.(Authority: 5 U.S.C. 552a(f)(3))
    (e) Nothing in 5 U.S.C. 552a, however, allows an individual access 
to any information compiled in reasonable anticipation of civil action 
or proceeding. (5 U.S.C. 552a(d)(5))
    (f) Fees to be charged, if any, to any individual for making copies 
of his or her record shall not include the cost of any search for and 
review of the record, and will be as follows:

------------------------------------------------------------------------
              Activity                               Fees
------------------------------------------------------------------------
(1) Duplication of documents by any  $0.15 per page after first 100 one-
 type of reproduction process to      sided pages.
 produce plain one-sided paper
 copies of a standard size (8\1/
 2\ x 11; 8\1/
 2\ x 14;
 11x14).
(2) Duplication of non-paper         Actual direct cost to the Agency as
 records, such as microforms,         defined in Sec.  1.555(a)(2) of
 audiovisual materials (motion        this part to the extent that it
 pictures, slides, laser optical      pertains to the cost of
 disks, video tapes, audio tapes,     duplication.
 etc.), computer tapes and disks,
 diskettes for personal computers,
 and any other automated media
 output.
(3) Duplication of document by any   Actual direct cost to the Agency as
 type of reproduction process not     defined in Sec.  1.555(a)(2) of
 covered by paragraphs (f)(1) or      this part to the extent that it
 (2) of this section to produce a     pertains to the cost of
 copy in a form reasonably usable     duplication.
 by the requester.
------------------------------------------------------------------------

    Note. Fees for any activities other than duplication by any type of 
reproducing process will be assessed under the provisions of Sec. 
1.526(i) or (j) of this part of any other applicable law.)
    (g) When VA benefit records, which are retrievable by name or 
individual identifier of a VA beneficiary or applicant for VA benefits, 
are requested by the individual to whom the record pertains, the 
duplication fee for one complete set of such records will be waived.

(Authority: 5 U.S.C. 552a(f)(5)) (38 U.S.C. 501)

[40 FR 33944, Aug. 12, 1975, as amended at 47 FR 16323, Apr. 16, 1982; 
53 FR 10380, Mar. 31, 1988; 55 FR 21546, May 25, 1990]

[[Page 72]]



Sec. 1.578  [Reserved]



Sec. 1.579  Amendment of records.

    (a) Any individual may request amendment of any Department of 
Veterans Affairs record pertaining to him or her. Not later than 10 days 
(excluding Saturdays, Sundays, and legal public holidays) after the date 
or receipt of such request, the Department of Veterans Affairs will 
acknowledge in writing such receipt. The Department of Veterans Affairs 
will complete the review to amend or correct a record as soon as 
reasonably possible, normally within 30 days from the receipt of the 
request (excluding Saturdays, Sundays, and legal public holidays) unless 
unusual circumstances preclude completing action within that time. The 
Department of Veterans Affairs will promptly either:
    (1) Correct any part thereof which the individual believes is not 
accurate, relevant, timely or complete; or
    (2) Inform the individual of the Department of Veterans Affairs 
refusal to amend the record in accordance with his or her request, the 
reason for the refusal, the procedures by which the individual may 
request a review of that refusal by the Secretary or designee, and the 
name and address of such official.


(Authority: 5 U.S.C. 552a(d)(2))

    (b) The administration or staff office having jurisdiction over the 
records involved will establish procedures for reviewing a request from 
an individual concerning the amendment of any record or information 
pertaining to the individual, for making a determination on the request, 
for an appeal within the Department of Veterans Affairs of an initial 
adverse Department of Veterans Affairs determination, and for whatever 
additional means may be necessary for each individual to be able to 
exercise fully, his or her right under 5 U.S.C. 552a.
    (1) Headquarters officials designated as responsible for the 
amendment of records or information located in Central Office and under 
their jurisdiction include, but are not limited to: Secretary; Deputy 
Secretary, as well as other appropriate individuals responsible for the 
conduct of business within the various Department of Veterans Affairs 
administrations and staff offices. These officials will determine and 
advise the requester of the identifying information required to relate 
the request to the appropriate record, evaluate and grant or deny 
requests to amend, review initial adverse determinations upon request, 
and assist requesters desiring to amend or appeal initial adverse 
determinations or learn further of the provisions for judicial review.
    (2) The following field officials are designated as responsible for 
the amendment of records or information located in facilities under 
their jurisdiction, as appropriate: The Director of each Center, 
Domiciliary, Medical Center, Outpatient Clinic, Regional Office, Supply 
Depot, and Regional Counsels. These officials will function in the same 
manner at field facilities as that specified in the preceding 
subparagraph for headquarters officials in Central Office.


(Authority: 5 U.S.C. 552a(f)(4))

    (c) Any individual who disagrees with the Department of Veterans 
Affairs refusal to amend his or her record may request a review of such 
refusal. The Department of Veterans Affairs will complete such review 
not later than 30 days (excluding Saturdays, Sundays, and legal public 
holidays) from the date on which the individual request such review and 
make a final determination unless, for good cause shown, the Secretary 
extends such 30-day period. If, after review, the Secretary or designee 
also refuses to amend the record in accordance with the request the 
individual will be advised of the right to file with the Department of 
Veterans Affairs a concise statement setting forth the reasons for his 
or her disagreement with the Department of Veterans Affairs refusal and 
also advise of the provisions for judicial review of the reviewing 
official's determination. (5 U.S.C. 552a(g)(1)(A))
    (d) In any disclosure, containing information about which the 
individual has filed a statement of disagreement, occurring after the 
filing of the statement under paragraph (c) of this section, the 
Department of Veterans Affairs will clearly note any part of the

[[Page 73]]

record which is disputed and provide copies of the statement (and, if 
the Department of Veterans Affairs deems it appropriate, copies of a 
concise statement of the Department of Veterans Affairs reasons for not 
making the amendments requested) to persons or other agencies to whom 
the disputed record has been disclosed. (5 U.S.C. 552a(d)(4)) (38 U.S.C. 
501)

[47 FR 16324, Apr. 16, 1982]



Sec. 1.580  Administrative review.

    (a) Upon denial or a request under 38 CFR 1.577 or 1.579, the 
responsible Department of Veterans Affairs official or designated 
employee will inform the requester in writing of the denial, cite the 
reason or reasons and the Department of Veterans Affairs regulations 
upon which the denial is based, and advise that the denial may be 
appealed to the General Counsel.
    (b) The final agency decision in such appeals will be made by the 
General counsel or the Deputy General Counsel.

(Authority: 38 U.S.C. 501)

[40 FR 33944, Aug. 12, 1975, as amended at 47 FR 16324, Apr. 16, 1982; 
55 FR 21546, May 25, 1990]



Sec. 1.581  [Reserved]



Sec. 1.582  Exemptions.

    (a) Certain systems of records maintained by the Department of 
Veterans Affairs are exempted from provisions of the Privacy Act in 
accordance with exemptions (j) and (k) of 5 U.S.C. 552a.
    (b) Exemption of Inspector General Systems of Records. The 
Department of Veterans Affairs provides limited access to Inspector 
General Systems of Records as indicated.
    (1) The following systems of records are exempted pursuant to the 
provisions of 5 U.S.C. 552a(j)(2) from subsections (c)(3) and (4), (d), 
(e)(1), (2) and (3), (e)(4) (G), (H) and (I), (e)(5) and (8), (f) and 
(g) of 5 U.S.C. 552a; in addition, the following systems of records are 
exempted pursuant to the provisions of 5 U.S.C. 552a(k)(2) from 
subsections (c)(3), (d), (e)(1), (e)(4) (G), (H), and (I), and (f) of 5 
U.S.C. 552a:
    (i) Investigation Reports of Persons Allegedly Involved in 
Irregularities Concerning VA and Federal Laws, Regulations, Programs, 
etc.--VA (11 VA51); and
    (ii) Inspector General Complaint Center Records--VA (66VA53).
    (2) These exemptions apply to the extent that information in those 
systems is subject to exemptions pursuant to 5 U.S.C. 552a (j)(2) and 
(k)(2).
    (3) For the reasons set forth, the systems of records listed under 
paragraph (b)(1) of this section are exempted under sections 552a (j)(2) 
and (k)(2) from the following provisions of 5 U.S.C. 552a:
    (i) 5 U.S.C. 552a(c)(3) requires that upon request, an agency must 
give an individual named in a record an accounting which reflects the 
disclosure of the record to other persons or agencies. This accounting 
must state the date, nature and purpose of each disclosure of the record 
and the name and address of the recipient. The application of this 
provision would alert subjects to the existence of the investigation and 
identify that such persons are subject of that investigation. Since 
release of such information to subjects would provide them with 
significant information concerning the nature of the investigation, it 
could result in the altering or destruction of derivative evidence which 
is obtained from third parties, improper influencing of witnesses, and 
other activities that could impede or compromise the investigation.
    (ii) 5 U.S.C. 552a(c)(4), (d), (e)(4) (G) and (H), (f) and (g) 
relate to an individual's right to be notified of the existence of 
records pertaining to such individual; requirements for identifying an 
individual who requests access to records; the agency procedures 
relating to access to records and the amendment of information contained 
in such records; and the civil remedies available to the individual in 
the event of adverse determinations by an agency concerning access to or 
amendment of information contained in record systems. This system is 
exempt from the foregoing provisions for the following reasons: To 
notify an individual at the individual's request of the existence of 
records in an investigative file pertaining to such individual or to 
grant access to an investigative file could interfere with investigative 
and enforcement proceedings, threaten the

[[Page 74]]

safety of individuals who have cooperated with authorities, constitute 
an unwarranted invasion of personal privacy of others, disclose the 
identity of confidential sources, reveal confidential information 
supplied by these sources, and disclose investigative techniques and 
procedures.
    (iii) 5 U.S.C. 552a(e)(4)(I) requires the publication of the 
categories of sources of records in each system of records. The 
application of this provision could disclose investigative techniques 
and procedures and cause sources to refrain from giving such information 
because of fear of reprisal, or fear of breach of promises of anonymity 
and confidentiality. This could compromise the ability to conduct 
investigations and to identify, detect and apprehend violators. Even 
though the agency has claimed an exemption from this particular 
requirement, it still plans to generally identify the categories of 
records and the sources for these records in this system. However, for 
the reasons stated in paragraph (b)(3)(ii) of this section, this 
exemption is still being cited in the event an individual wants to know 
a specific source of information.
    (iv) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its 
records only such information about an individual that is relevant and 
necessary to accomplish a purpose of the agency required by statute or 
Executive order. These systems of records are exempt from the foregoing 
provisions because:
    (A) It is not possible to detect the relevance or necessity of 
specific information in the early stages of a criminal or other 
investigation.
    (B) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary may ultimately be determined to be 
unnecessary. It is only after the information is evaluated that the 
relevance and necessity of such information can be established.
    (C) In any investigation the Inspector General may obtain 
information concerning the violations of laws other than those within 
the scope of his/her jurisdiction. In the interest of effective law 
enforcement, the Inspector General should retain this information as it 
may aid in establishing patterns of criminal activity and provide leads 
for those law enforcement agencies charged with enforcing other segments 
of civil or criminal law.
    (v) 5 U.S.C. 552a(e)(2) requires an agency to collect information to 
the greatest extent practicable directly from the subject individual 
when the information may result in adverse determinations about an 
individual's rights, benefits, and privileges under Federal programs. 
The application of this provision would impair investigations of illegal 
acts, violations of the rules of conduct, merit system and any other 
misconduct for the following reasons:
    (A) In order to successfully verify a complaint, most information 
about a complainant or an individual under investigation must be 
obtained from third parties such as witnesses and informers. It is not 
feasible to rely upon the subject of the investigation as a source for 
information regarding his/her activities because of the subject's rights 
against self-incrimination and because of the inherent unreliability of 
the suspect's statements. Similarly, it is not always feasible to rely 
upon the complainant as a source of information regarding his/her 
involvement in an investigation.
    (B) The subject of an investigation will be alerted to the existence 
of an investigation if an attempt is made to obtain information from the 
subject. This would afford the individual the opportunity to conceal any 
criminal activities to avoid apprehension.
    (vi) 5 U.S.C. 552a(e)(3) requires that an agency must inform the 
subject of an investigation who is asked to supply information of:
    (A) The authority under which the information is sought and whether 
disclosure of the information is mandatory or voluntary;
    (B) The purposes for which the information is intended to be used;
    (C) The routine uses which may be made of the information; and
    (D) The effects on the subject, if any, of not providing the 
requested information. The reasons for exempting this system of records 
from the foregoing provision are as follows:
    (1) The disclosure to the subject of the purposes of the 
investigation as

[[Page 75]]

stated in paragraph (b)(3)(vi)(B) of this paragraph would provide the 
subject with substantial information relating to the nature of the 
investigation and could impede or compromise the investigation.
    (2) If the complainant or the subject were informed of the 
information required by this provision, it could seriously interfere 
with undercover activities requiring disclosure of the authority under 
which the information is being requested. This could conceivably 
jeopardize undercover agents' identities and impair their safety, as 
well as impair the successful conclusion of the investigation.
    (3) Individuals may be contacted during preliminary information 
gathering in investigations before any individual is identified as the 
subject of an investigation. Informing the individual of the matters 
required by this provision would hinder or adversely affect any present 
or subsequent investigations.
    (vii) 5 U.S.C. 552a(e)(5) requires that records be maintained with 
such accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to assure fairness to the individual in making any 
determination about an individual. Since the law defines maintain to 
include the collection of information, complying with this provision 
would prevent the collection of any data not shown to be accurate, 
relevant, timely, and complete at the moment of its collection. In 
gathering information during the course of an investigation it is not 
always possible to determine this prior to collection of the 
information. Facts are first gathered and then placed into a logical 
order which objectively proves or disproves criminal behavior on the 
part of the suspect. Material which may seem unrelated, irrelevant, 
incomplete, untimely, etc., may take on added meaning as an 
investigation progresses. The restrictions in this provision could 
interfere with the preparation of a complete investigative report.
    (viii) 5 U.S.C. 552a(e)(8) requires an agency to make reasonable 
efforts to serve notice on an individual when any record on such 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The notice 
requirement of this provision could prematurely reveal an ongoing 
criminal investigation to the subject of the investigation.
    (c) Exemption of Loan Guaranty Service, Veterans Benefits 
Administration, Systems of Records. The Department of Veterans Affairs 
provides limited access to Loan Guaranty Service, Veterans Benefits 
Administration, systems of records as indicated:
    (1) The following systems of records are exempted pursuant to the 
provisions of 5 U.S.C. 552a(k)(2) from subsections (c)(3), (d), (e)(1) 
and (e)(4) (G), (H) and (I) and (f):
    (i) Loan Guaranty Fee Personnel and Program Participant Records--VA 
(17VA26); and
    (ii) Loan Guaranty Home Condominium and Mobile Home Loan Applicant 
Records and Paraplegic Grant Application Records--VA (55VA26).
    (2) These exemptions apply to the extent that information in these 
systems is subject to exemption pursuant to 5 U.S.C. 552a(k)(2).
    (3) For the reasons set forth, the systems of records listed under 
paragraph (c)(1) of this section are exempted under 5 U.S.C. 552a(k)(2) 
from the following provisions of 5 U.S.C. 552a:
    (i) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request. These accountings must state the date, nature and purpose 
of each disclosure of the record and the name and address of the 
recipient. The application of this provision would alert subjects of an 
investigation to the existence of the investigation and that such 
persons are subjects of that investigation. Since release of such 
information to subjects of an investigation would provide the subjects 
with significant information concerning the nature of the investigation, 
it could result in the altering or destruction of documentary evidence, 
improper influencing of witnesses and other activities that could impede 
or compromise the investigation.
    (ii) 5 U.S.C. 552a(d), (e)(4) (G) and (H) and (f) relate to an 
individual's right to be notified of the existence of records pertaining 
to such individual; requirements for identifying an individual

[[Page 76]]

who requests access to records; and the agency procedures relating to 
access to records and the contest of information contained in such 
records. This system is exempt from the foregoing provisions for the 
following reasons: To notify an individual at the individual's request 
of the existence of records in an investigative file pertaining to such 
individual or to grant access to an investigative file could interfere 
with investigative and enforcement proceedings; constitute an 
unwarranted invasion of the personal privacy of others; disclose the 
identity of confidential sources and reveal confidential information 
supplied by these sources and disclose investigative techniques and 
procedures.
    (iii) 5 U.S.C. 552a(e)(4)(I) requires the publication of the 
categories of sources of records in each system of records. The 
application of this provision could disclose investigative techniques 
and procedures and cause sources to refrain from giving such information 
because of fear of reprisal, or fear of breach of promises of anonymity 
and confidentiality. This would compromise the ability to conduct 
investigations. Even though the agency has claimed an exemption from 
this particular requirement, it still plans to generally identify the 
categories of records and the sources for these records in this system. 
However, for the reasons stated above, this exemption is still being 
cited in the event an individual wanted to know a specific source of 
information.
    (iv) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its 
records only such information about an individual that is relevant and 
necessary to accomplish a purpose of the agency required by statute or 
Executive order. This system of records is exempt from the foregoing 
provision because:
    (A) It is not possible to detect relevance or necessity of specific 
information in the early stages of an investigation.
    (B) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary when collected may ultimately be 
determined to be unnecessary. It is only after the information is 
evaluated that the relevance and necessity of such information can be 
established.
    (C) In interviewing persons or obtaining other forms of evidence 
during an investigation, information may be supplied to the investigator 
which relates to matters incidental to the main purpose of the 
investigation but which is appropriate in a thorough investigation. 
Oftentimes, such information cannot readily be segregated.
    (4) The following system of records is exempt pursuant to the 
provisions of 5 U.S.C. 552a(k)(5) from subsections (c)(3), (d), (e)(1), 
(e)(4) (G), (H) and (I) and (f): Loan Guaranty Fee Personnel and Program 
Participant Records--VA (17 VA 26).
    (5) This exemption applies to the extent that information in this 
system is subject to exemption pursuant to 5 U.S.C. 552a(k)(5).
    (6) For the reasons set forth, the system of records listed in 
paragraph (c)(4) of this section is exempt under 5 U.S.C. 552a(k)(5) 
from the following provisions of 5 U.S.C. 552a:
    (i) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request. These accountings must state the date, nature and purpose 
of each disclosure of the record and the name and address of the 
recipient. The application of this provision would alert subjects of 
background suitability investigations to the existence of the 
investigation and reveal that such persons are subjects of that 
investigation. Since release of such information to subjects of an 
investigation would provide the subjects with significant information 
concerning the nature of the investigation, it could result in revealing 
the identity of a confidential source.
    (ii) 5 U.S.C. 552a(d), (e)(4) (G) and (H) and (f) relate to an 
individual's right to be notified of the existence of records pertaining 
to such individual; requirements for identifying an individual who 
requests access to records; and the agency procedures relating to access 
to records and the contest of information contained in such records. 
This system is exempt from the foregoing provisions for the following 
reasons: To notify an individual at the individual's

[[Page 77]]

request of the existence of records in an investigative file pertaining 
to such an individual or to grant access to an investigative file would 
disclose the identity of confidential sources and reveal confidential 
information supplied by these sources.
    (iii) 5 U.S.C. 552a(e)(4)(I) requires the publication of the 
categories of sources of records in each system of records. The 
application of this provision could disclose sufficient information to 
disclose the identity of a confidential source and cause sources to 
refrain from giving such information because of fear of reprisal, or 
fear of breach of promises of anonymity and confidentiality. This would 
compromise the ability to conduct background suitability investigations.
    (iv) 5 U.S.C. 552a(e)(1) requires each agency to maintain in its 
records only such information about an individual that is relevant and 
necessary to accomplish a purpose of the agency required by statute or 
Executive order. This system of records is exempt from the foregoing 
provision because:
    (A) It is not possible to detect relevance and necessity of specific 
information from a confidential source in the early stages of an 
investigation.
    (B) Relevance and necessity are questions of judgment and timing. 
What appears relevant and necessary when collected may ultimately be 
determined to be unnecessary. It is only after the information is 
evaluated that the relevance and necessity of such information can be 
established regarding suitability for VA approval as a fee appraiser or 
compliance inspector.
    (C) In interviewing persons or obtaining other forms of evidence 
during an investigation for suitability for VA approval, information may 
be supplied to the investigator which relates to matters incidental to 
the main purpose of the investigation but which is appropriate in a 
thorough investigation. Oftentimes, such information cannot readily be 
segregated and disclosure might jeopardize the identity of a 
confidential source.
    (d) Exemption of Police and Security Records. VA provides limited 
access to one Security and Law Enforcement System of Records, Police and 
Security Records--VA (103VA07B).
    (1) The investigations records and reports contained in this System 
of Records are exempted [pursuant to 5 U.S.C. 552a(j)(2) of the Privacy 
Act of 1974] from Privacy Act subsections (c)(3) and (c)(4); (d); (e)(1) 
through (e)(3), (e)(4)(G) through (e)(4)(I), (e)(5), and (e)(8); (f); 
and (g); in addition, they are exempted [pursuant to 5 U.S.C. 552a(k)(2) 
of the Privacy Act of 1974] from Privacy Act subsections (c)(3); (d); 
(e)(1), (e)(4)(G) through (e)(4)(I); and (f).
    (2) These records contained in the Police and Security Records--VA 
(103VA076B) are exempted for the following reasons:
    (i) The application of Privacy Act subsection (c)(3) would alert 
subjects to the existence of the investigation and reveal that they are 
subjects of that investigation. Providing subjects with information 
concerning the nature of the investigation could result in alteration or 
destruction of evidence which is obtained from third parties, improper 
influencing of witnesses, and other activities that could impede or 
compromise the investigation.
    (ii) The application of Privacy Act subsections (c)(4); (d); 
(e)(4)(G) and (e)(4)(H); (f); and (g) could interfere with investigative 
and enforcement proceedings, threaten the safety of individuals who have 
cooperated with authorities, constitute an unwarranted invasion of 
personal privacy of others, disclose the identity of confidential 
sources, reveal confidential information supplied by these sources, and 
disclose investigative techniques and procedures.
    (iii) The application of Privacy Act subsection (e)(4)(I) could 
disclose investigative techniques and procedures and cause sources to 
refrain from giving such information because of fear of reprisal, or 
fear of breach of promises of anonymity and confidentiality. This could 
compromise the ability to conduct investigations and to identify, detect 
and apprehend violators. Even though the agency has claimed an exemption 
from this particular requirement, it still plans to generally identify 
the categories of records and the sources of these records in this 
system.

[[Page 78]]

However, for the reason stated in paragraph (d)(2)(ii) of this section, 
this exemption is still being cited in the event an individual wants to 
know a specific source of information.
    (iv) These records contained in the Police and Security Records--VA 
(103VA076B) are exempt from Privacy Act subsection (e)(1) because it is 
not possible to detect the relevance or necessity of specific 
information in the early stages of a criminal or other investigation. 
Relevance and necessity are questions of judgment and timing. What 
appears relevant and necessary may ultimately be determined to be 
unnecessary. It is only after the information is evaluated that the 
relevance and necessity of such information can be established. In any 
investigation, the Office of Security and Law Enforcement may obtain 
information concerning violations of laws other than those within the 
scope of its jurisdiction. In the interest of effective law enforcement, 
the Office of Security and Law Enforcement should retain this 
information as it may aid in establishing patterns of criminal activity 
and provide leads for those law enforcement agencies charged with 
enforcing other segments of civil or criminal law.
    (v) The application of Privacy Act subsection (e)(2) would impair 
investigations of illegal acts, violations of the rules of conduct, 
merit system and any other misconduct for the following reasons:
    (A) In order to successfully verify a complaint, most information 
about a complainant or an individual under investigation must be 
obtained from third parties such as witnesses and informers. It is not 
feasible to rely upon the subject of the investigation as a source for 
information regarding his/her activities because of the subject's rights 
against self-incrimination and because of the inherent unreliability of 
the suspect's statements. Similarly, it is not always feasible to rely 
upon the complainant as a source of information regarding his/her 
involvement in an investigation.
    (B) The subject of an investigation will be alerted to the existence 
of an investigation if an attempt is made to obtain information from the 
subject. This would afford the individual the opportunity to conceal any 
criminal activities to avoid apprehension.
    (vi) The reasons for exempting these records in the Police and 
Security Records--VA (103VA07B) from Privacy Act subsection (e)(3) are 
as follows:
    (A) The disclosure to the subject of the purposes of the 
investigation would provide the subject with substantial information 
relating to the nature of the investigation and could impede or 
compromise the investigation.
    (B) Informing the complainant or the subject of the information 
required by this provision could seriously interfere with undercover 
activities, jeopardize the identities of undercover agents and impair 
their safety, and impair the successful conclusion of the investigation.
    (C) Individuals may be contacted during preliminary information 
gathering in investigations before any individual is identified as the 
subject of an investigation. Informing the individual of the matters 
required by this provision would hinder or adversely affect any present 
or subsequent investigations.
    (vii) Since the Privacy Act defines ``maintain'' to include the 
collection of information, complying with subsection (e)(5) would 
prevent the collection of any data not shown to be accurate, relevant, 
timely, and complete at the moment of its collection. In gathering 
information during the course of an investigation, it is not always 
possible to make this determination prior to collecting the information. 
Facts are first gathered and then placed into a logical order which 
objectively proves or disproves criminal behavior on the part of the 
suspect. Material that may seem unrelated, irrelevant, incomplete, 
untimely, etc., may take on added meaning as an investigation 
progresses. The restrictions in this provision could interfere with the 
preparation of a complete investigative report.
    (viii) The notice requirement of Privacy Act subsection (e)(8) could 
prematurely reveal an ongoing criminal investigation to the subject of 
the investigation.

(Authority: 5 U.S.C. 552a (j) and (k); 38 U.S.C. 501)

[48 FR 29847, June 29, 1983, as amended at 68 FR 35298, June 13, 2003]

[[Page 79]]



Sec. Sec. 1.583-1.584  [Reserved]

   Expanded Remote Access to Computerized Veterans Claims Records by 
                       Accredited Representatives



Sec. 1.600  Purpose.

    (a) Sections 1.600 through 1.603 establish policy, assign 
responsibilities and prescribe procedures with respect to:
    (1) When, and under what circumstances, VA will grant authorized 
claimants' representatives read-only access to the automated Veterans 
Benefits Administration (VBA) claims records of those claimants whom 
they represent;
    (2) The exercise of authorized access by claimants' representatives; 
and
    (3) The bases and procedures for disqualification of a 
representative for violating any of the requirements for access.
    (b) VBA will grant access to its automated claimants' claims records 
from locations outside Regional Offices under the following conditions. 
Access will be provided:
    (1) Only to individuals and organizations granted access to 
automated claimants' records under Sec. Sec. 1.600 through 1.603;
    (2) Only to the claims records of VA claimants whom the organization 
or individual represents as reflected in the claims file;
    (3) Solely for the purpose of the representative assisting the 
individual claimant whose records are accessed in a claim for benefits 
administered by VA; and
    (4) On a read-only basis. Individuals authorized access to VBA 
automated claims records under Sec. Sec. 1.600 through 1.603 will not 
be permitted to modify the data.
    (c)(1) Access will be authorized only to the inquiry commands of the 
Benefits Delivery Network which provide access to the following 
categories of data:
    (i) Beneficiary identification data such as name, social security 
number, sex, date of birth, service number and related service data; and
    (ii) Claims history and processing data such as folder location, 
claim status, claim establishment date, claim processing history, award 
data, rating data, including service-connected medical conditions, 
income data, dependency data, deduction data, payment data, educational 
facility and program data (except chapter 32 benefits), and education 
program contribution and delimiting data (except chapter 32 benefits).
    (2) Access to this information will currently be through the inquiry 
commands of BINQ (BIRLS (Beneficiaries Identification and Records 
Location Subsystem) Inquiry), SINQ (Status Inquiry), MINQ (Master Record 
Inquiry), PINQ (Pending Issue Inquiry) and TINQ (Payment History 
Inquiry). The identifying information received from BIRLS to 
representative inquiries will be limited to file number, veteran's name, 
date of death, folder location and transfer date of folder, insurance 
number, insurance type, insurance lapse date and insurance folder 
jurisdiction.
    (d) Sections 1.600 through 14.603 are not intended to, and do not:
    (1) Waive the sovereign immunity of the United States; or
    (2) Create, and may not be relied upon to create, any right or 
benefit, substantive or procedural, enforceable at law against the 
United States or the Department of Veterans Affairs.

[59 FR 47084, Sept. 14, 1994. Redesignated and amended at 73 FR 29870, 
29879, May 22, 2008]



Sec. 1.601  Qualifications for access.

    (a) An applicant for read-only access to VBA automated claims 
records from a location other than a VA Regional Office must be:
    (1) An organization, representative, attorney or agent approved or 
accredited by VA under Sec. Sec. 14.626 through 14.635; or
    (2) An attorney of record for a claimant in proceedings before the 
Court of Veterans Appeals or subsequent proceedings who requests access 
to the claimant's automated claims records as part of the representation 
of the claimant.
    (b) The hardware, modem and software utilized to obtain access, as 
well as their location, must be approved in advance by VBA.
    (c) Each individual and organization approved for access must sign 
and return a notice provided by the Regional Office Director (or the 
Regional Office

[[Page 80]]

Director's designee) of the Regional Office of jurisdiction for the 
claim. The notice will specify the applicable operational and security 
requirements for access and an acknowledgment that the breach of any of 
these requirements is grounds for disqualification from access.

[59 FR 47084, Sept. 14, 1994. Redesignated at 73 FR 29870, May 22, 2008]



Sec. 1.602  Utilization of access.

    (a) Once an individual or organization has been issued the necessary 
passwords to obtain read-only access to the automated claims records of 
individuals represented, access will be exercised in accordance with the 
following requirements:
    (1) The individual or organization will obtain access only from 
equipment and software approved in advance by the Regional Office from 
the location where the individual or organization primarily conducts its 
representation activities which also has been approved in advance;
    (2) The individual will use only his or her assigned password to 
obtain access;
    (3) The individual will not reveal his or her password to anyone 
else, or allow anyone else to use his or her password;
    (4) The individual will access only the VBA automated claims records 
of VA claimants who are represented by the person obtaining access or by 
the organization employing the person obtaining access;
    (5) The individual will access a claimant's automated claims record 
solely for the purpose of representing that claimant in a claim for 
benefits administered by VA;
    (6) Upon receipt of the password, the individual will destroy the 
hard copy; no written or printed record containing the password will be 
retained; and
    (7) The individual and organization will comply with all security 
requirements VBA deems necessary to ensure the integrity and 
confidentiality of the data and VBA's automated computer systems.
    (b) An organization granted access shall ensure that all employees 
provided access in accordance with these regulations will receive 
regular, adequate training on proper security, including the items 
listed in Sec. 1.603(a). Where an individual such as an attorney or 
registered agent is granted access, he or she will regularly review the 
security requirements for the system as set forth in these regulations 
and in any additional materials provided by VBA.
    (c) VBA may, at any time without notice:
    (1) Inspect the computer hardware and software utilized to obtain 
access and their location;
    (2) Review the security practices and training of any individual or 
organization granted access under these regulations; and
    (3) Monitor an individual's or organization's access activities. By 
applying for, and exercising, the access privileges under Sec. Sec. 
1.600 through 1.603, the applicant expressly consents to VBA monitoring 
the access activities of the applicant at any time.

[59 FR 47084, Sept. 14, 1994. Redesignated and amended at 73 FR 29870, 
29879, May 22, 2008]



Sec. 1.603  Disqualification.

    (a) The Regional Office Director or the Regional Office Director's 
designee may revoke an individual's or an organization's access 
privileges to a particular claimant's records because the individual or 
organization no longer represents the claimant, and, therefore, the 
beneficiary's consent is no longer in effect. The individual or 
organization is no longer entitled to access as a matter of law under 
the Privacy Act, 5 U.S.C. 552a, and 38 U.S.C. 5701 and 7332. Under these 
circumstances, the individual or organization is not entitled to any 
hearing or to present any evidence in opposition to the revocation.
    (b) The Regional Office Director or the Regional Office Director's 
designee may revoke an individual's or an organization's access 
privileges either to an individual claimant's records or to all 
claimants' records in the VBA automated claims benefits systems if the 
individual or organization:
    (1) Violates any of the provisions of Sec. Sec. 1.600 through 
1.603;
    (2) Accesses or attempts to access data for a purpose other than 
representation of an individual veteran;

[[Page 81]]

    (3) Accesses or attempts to access data other than the data 
specified in these regulations;
    (4) Accesses or attempts to access data on a VA beneficiary who is 
not represented either by the individual who obtains access or by the 
organization employing the individual who obtains access;
    (5) Utilizes unapproved computer hardware or software to obtain or 
attempt to obtain access to VBA computer systems;
    (6) Modifies or attempts to modify data in the VBA computer systems.
    (c) If VBA is considering revoking an individual's access under 
Sec. 1.603(b), and that individual works for an organization, the 
Regional Office of jurisdiction will notify the organization of the 
pendency of the action.
    (d) After an individual's access privileges are revoked, if the 
conduct which resulted in revocation was such that it merits reporting 
to an appropriate governmental licensing organization such as a State 
bar, the VBA Regional Office of jurisdiction will immediately inform the 
licensing organization in writing of the fact that the individual's 
access privileges were revoked and the reasons why.
    (e) The VBA Regional Office of jurisdiction may temporarily suspend 
access privileges prior to any determination on the merits of the 
proposed revocation where the Regional Office Director or the Director's 
designee determines that such immediate suspension is necessary in order 
to protect the integrity of the system or confidentiality of the data in 
the system from a reasonably foreseeable compromise. However, in such 
case, the Regional Office shall offer the individual or organization an 
opportunity to respond to the charges immediately after the temporary 
suspension.

[59 FR 47084, Sept. 14, 1994. Redesignated and amended at 73 FR 29870, 
29879, May 22, 2008]

        Inventions by Employees of Department of Veterans Affairs

    Authority: Sections 1.650 to 1.666 issued under sect. 1, 66 Stat. 
811, 72 Stat. 1114; 35 U.S.C. 266; 15 U.S.C. 3710a; 38 U.S.C. 501; E.O. 
10096, E.O. 10930, 15 FR 389; 3 CFR 1949-1953 Comp.



Sec. 1.650  Purpose.

    The purpose of these regulations is to prescribe the procedure to be 
followed in determining and protecting the respective rights of the 
United States Government and of Department of Veterans Affairs employees 
who make inventions.

[21 FR 10377, Dec. 28, 1956, as amended at 61 FR 29658, June 12, 1996]



Sec. 1.651  Definitions.

    The terms as used in the regulations concerning inventions by 
employees of the Department of Veterans Affairs are defined as follows:
    (a) The term invention includes any art, machine, manufacture, 
design, or composition of matter, or any new and useful improvement 
thereof, or any variety of plant, which is or may be patentable under 
the patent laws of the United States.
    (b) The term employee or Government employee means any officer or 
employee, civilian or military, of the Department of Veterans Affairs. 
Part-time, without compensation (WOC) employees and part-time 
consultants are included.
    (c) The term Secretary of Commerce means the Under Secretary of 
Commerce for Technology.

[21 FR 10377, Dec. 28, 1956, as amended at 31 FR 5291, Apr. 2, 1966; 61 
FR 29658, June 12, 1996]



Sec. 1.652  Criteria for determining rights to employee inventions.

    (a) The criteria to be applied in determining the respective rights 
of the Government and of the employee-inventor in and to any invention 
subject to these provisions shall be in accordance with the Uniform 
Patent Policy regulations found at 37 CFR 501.6 and 501.7.
    (b) Ownership in and to inventions arising under Cooperative 
Research and Development Agreements (CRADAs) pursuant to 15 USC 3710a 
shall be governed by the provisions of the pertinent CRADA, as 
authorized by the Federal Technology Transfer Act.

(Authority: 15 U.S.C. 3710a; 37 CFR part 501)

[61 FR 29658, June 12, 1996]

[[Page 82]]



Sec. 1.653  Delegation of authority.

    The General Counsel, Deputy General Counsel or Assistant General 
Counsel for Professional Staff Group IV is authorized to act for the 
Secretary of Veterans Affairs in matters concerning patents and 
inventions, unless otherwise required by law. The determination of 
rights to an invention as between the Government and the employee where 
there is no cooperative research and development agreement shall be made 
by the General Counsel, Deputy General Counsel or the Assistant General 
Counsel for Professional Staff Group IV, in accordance with 37 CFR part 
500.

[62 FR 14822, Mar. 28, 1997]



Sec. 1.654  Patenting of inventions.

    Any invention owned by the Government under the criteria as set 
forth in 37 CFR 501.6 should be protected by an application for a 
domestic patent and other necessary documents executed by the employee 
inventor prepared by or through the General Counsel, Deputy General 
Counsel or Assistant General Counsel for Professional Staff Group IV, 
unless some other agency has primary interest or it is decided to 
dedicate the invention to the public. Such dedication requires approval 
of the Secretary of Commerce. Applications on behalf of the Government 
for foreign patents may be made if determined to be in the public 
interest. The payment of necessary expenses in connection with any 
application filed or patent obtained under this section by the 
Department of Veterans Affairs is authorized.

[31 FR 5291, Apr. 2, 1966, as amended at 54 FR 26027, June 21, 1989; 61 
FR 29658, June 12, 1996; 62 FR 14822, Mar. 28, 1997]



Sec. 1.655  Government license in invention of employee.

    If an invention is made by an employee and it is determined that the 
employee inventor is entitled to full ownership under 37 CFR 501.6, 
subject to a nonexclusive, irrevocable, royalty-free license in the 
Government with power to grant sublicenses for all Governmental 
purposes, it shall be the duty of the employee inventor to notify the 
Office of General Counsel of the status of the patent application, 
including the patent application number, so that the Department may 
protect the interests reserved to the Government under 37 CFR 501.6.

[61 FR 29658, June 12, 1996]



Sec. 1.656  Information to be submitted by inventor.

    (a) In the case of an invention or believed invention, the inventor 
will prepare a statement for submission to his or her immediate 
superior. It will be submitted regardless of where the ownership is 
believed to exist. The statement will consist of two parts:
    (1) One part of the statement will be a disclosure of the invention 
sufficient to permit the preparation of a patent applicant. It shall 
consist of a description, including where applicable, of the parts or 
components of the invention as shown on the drawings or blueprints, 
accompanied further by a description of the construction and operation 
of the invention. Photographs of the invention may be included. The 
inventor should state pertinent prior art known to him or her, and set 
forth in detail as clearly as possible the respects which his or her 
invention differs.
    (2) The other part of the statement will set forth the circumstances 
attending the making of the invention. It will include the full name and 
address of the inventor; the grade and title of his or her position; 
whether full time or part time; his or her duties at the time the 
invention was made; the facts pertinent to a determination whether the 
invention bore a direct relation to or was made in consequence of such 
official duties; whether there was, and if so, the terms of any special 
agreement or understanding with respect to use or manufacture of his or 
her invention; date of the invention; when and where it was conceived, 
constructed and tested; whether it was made entirely during working 
hours; whether, and to what extent there was a contribution by the 
Government of any of the following: Facilities; equipment; materials or 
supplies; funds; information; time or services of other Government 
employees on duty. When the invention is disclosed through publication, 
or in consultation with a manufacturer or attorney, simultaneous 
notification of

[[Page 83]]

the publication shall be given to the Office of General Counsel. A copy 
of the article will accompany the notification.
    (b) The inventor's immediate superior shall promptly review the 
statement of the employee inventor for completeness and accuracy, and 
shall certify that the employee's statement of circumstances attending 
the invention is or is not correct, giving reasons if pertinent. The 
file should then be submitted through the facility head (or 
administration heads or top staff officials in the case of Central 
Office employees) to the General Counsel together with any comments or 
recommendations.

[61 FR 29658, June 12, 1996]



Sec. 1.657  Determination of rights.

    The General Counsel, Deputy General Counsel or Assistant General 
Counsel for Professional Staff Group IV will make a determination of 
rights subject to review where required by the Secretary of Commerce. 
The determination will be in accordance with 37 CFR 501.7.

[61 FR 29658, June 12, 1996, as amended at 62 FR 14822, Mar. 28, 1997]



Sec. 1.658  Right of appeal.

    In accordance with 37 CFR 501.8, the employee has a right of appeal 
to the Secretary of Commerce within 30 days of receipt of the 
Department's determination of ownership rights. The decision reached by 
the Secretary of Commerce will be communicated to the employee.

[61 FR 29658, June 12, 1996]



Sec. 1.659  Relationship to incentive awards program.

    Procedures set out in the regulations concerning inventions by 
employees of the Department of Veterans Affairs are not affected by the 
submission or proposed submission of an employee suggestion or idea on 
an item which may be patentable. Consideration of an item for a 
determination of ownership rights and also for an incentive award will 
proceed simultaneously, usually on separate correspondence. An employee 
suggestion or copies and extracts of the file may be forwarded to the 
General Counsel by the reviewing or awarding authority, or by the 
facility head, for an ownership determination where the employee idea or 
suggestion involves an invention. The employee shall be directed to 
submit a disclosure of invention in accordance with these regulations if 
such has not been previously submitted.

[31 FR 5291, Apr. 2, 1966, as amended at 61 FR 29659, June 12, 1996]



Sec. 1.660  Expeditious handling.

    No patent may be granted where the invention has been in public use 
or publicly disclosed for more than one year before filing of a patent 
application. Hence, submissions involving inventions should be made as 
promptly as possible in order to avoid delay which might jeopardize 
title to the invention or impair the rights of the inventor or the 
Government.

[61 FR 29659, June 12, 1996]



Sec. 1.661  Information to be kept confidential.

    All information pertaining to inventions and pending patent 
applications is confidential, and employees having access to such 
information are forbidden to disclose or reveal the same except as 
required in the performance of their official duties.

[21 FR 10378, Dec. 28, 1956. Redesignated at 61 FR 29659, June 12, 1996]



Sec. 1.662  Provisions of regulations made a condition of employment.

    The provisions of the regulations concerning inventions by employees 
of the Department of Veterans Affairs shall be a condition of employment 
of all employees.

[21 FR 10378, Dec. 28, 1956. Redesignated at 61 FR 29659, June 12, 1996]



Sec. 1.663  Licensing of Government-owned inventions.

    (a) The licensing of Government-owned inventions under VA control 
and custody will be conducted pursuant to the regulations on the 
licensing of Government-owned inventions contained in 37 CFR part 404, 
and 15 U.S.C. 3710a, as appropriate.

[[Page 84]]

    (b) Any person whose application for a license in an invention under 
VA control and custody has been denied; whose license in such an 
invention has been modified or terminated, in whole or in part; or who 
timely filed a written objection in response to a proposal to grant an 
exclusive or partially exclusive license in an invention under VA 
control or custody, may, if damaged, appeal any decision or 
determination concerning the grant, denial, interpretation, 
modification, or termination of a license to the Secretary of Veterans 
Affairs. Such appeal shall be in writing; shall set forth with 
specificity the basis of the appeal; and shall be postmarked not later 
than 60 days after the action being appealed. Upon request of the 
appellant, such appeal may be considered by one to three persons 
appointed on a case-by-case basis by the Secretary of Veterans Affairs. 
Such a request will be granted only if it accompanies the written 
appeal. Appellant may appear and be represented by counsel before such a 
panel, which will sit in Washington, DC. If the appeal challenges a 
decision to grant an exclusive or partially exclusive license in an 
invention under VA control or custody, the licensee shall be furnished a 
copy of the appeal, shall be given the opportunity to respond in 
writing, may appear and be represented by counsel at any hearing 
requested by appellant, and may request a hearing if appellant has not, 
under the same terms and conditions, at which the appellant may also 
appear and be represented by counsel.

[61 FR 29659, June 12, 1996]



Sec. Sec. 1.664-1.666  [Reserved]

                     Administrative Control of Funds

    Source: 48 FR 30622, July 5, 1983, unless otherwise noted.



Sec. 1.670  Purpose.

    The following regulations establish a system of administrative 
controls for all appropriations and funds available to the Department of 
Veterans Affairs to accomplish the following purposes:
    (a) Establish an administrative subdivision of controls to restrict 
obligations and expenditures against each appropriation or fund to the 
amount of the apportionment or the reapportionment; and
    (b) Fix responsibility for the control of appropriations or funds to 
high level officials who bear the responsibility for apportionment or 
reapportionment control.

(Authority: 31 U.S.C. 1514)



Sec. 1.671  Definitions.

    For the purpose of Sec. Sec. 1.670 through 1.673, the following 
definitions apply:
    (a) Administrative subdivision of funds. An administrative 
subdivision of funds is any administrative subdivision of an 
appropriation or fund which makes funds available in a specified amount 
for the purpose of controlling apportionments or reapportionments.
    (b) Allotment. An allotment is an authorization by the Director, 
Office of Budget and Finance, to department and staff office heads 
(allottees) to incur obligations within specified amounts, during a 
specified period, pursuant to an Office of Management and Budget 
apportionment or reapportionment action. The creation of an obligation 
in excess of an allotment is a violation of the administrative 
subdivision of funds.
    (c) Allowance. An allowance is a subdivision below the allotment 
level, and is a guideline which may be issued by department or staff 
office heads (allottees) to facility directors and other officials, 
showing the expenditure pattern or operating budget they will be 
expected to follow in light of the program activities contemplated by 
the overall VA budget or plan of expenditure. The creation of an 
obligation in excess of an allowance is not a violation of the 
administrative subdivision of funds.

(Authority: 31 U.S.C. 1514)



Sec. 1.672  Responsibilities.

    (a) The issuance of an allotment to the administration and staff 
office heads (allottees) is required and is the responsibility of the 
Director, Office of Budget and Finance. The sum of such allotments shall 
not be in excess of the amount indicated in the apportionment or 
reapportionment document.

[[Page 85]]

    (b) The issuance of an allowance is discretionary with department or 
staff office heads (allottees), as an allowance is merely a management 
device which allottees may utilize in carrying out their 
responsibilities. Allottees are responsible for keeping obligations 
within the amounts of their allotments, whether allowances are issued or 
not.
    (c) The Director, Office of Budget and Finance, is responsible for 
requesting apportionments and reapportionments from the Office of 
Management and Budget. Administration and staff heads shall promptly 
request that an appropriation or fund be reapportioned if feasible 
whenever it appears that obligations may exceed the level of the 
apportionment.

(Authority: 31 U.S.C. 1514)



Sec. 1.673  Responsibility for violations of the administrative subdivision of funds.

    (a) In the event an allotment or an apportionment is exceeded except 
in the circumstances described in paragraph (b) of this section, the 
following factors will be considered in determining which official, or 
officials, are responsible for the violation.
    (1) Knowledge of circumstances which could lead to an allotment or 
apportionment being exceeded;
    (2) Whether the official had received explicit instructions to 
continue or cease incurring obligations;
    (3) Whether any action was taken in contravention of or with 
disregard for, instructions to monitor obligations incurred;
    (4) Whether the official had the authority to curtail obligations by 
directing a change in the manner of operations of the department or 
staff office; or
    (5) Any other facts which tend to fix the responsibility for the 
obligations which resulted in the allotment or apportionment being 
exceeded.
    (b) In the event that the sum of the allotments made in a particular 
fiscal year exceeds the amount apportioned by the Office of Management 
and Budget, and the apportionment is subsequently exceeded because of 
this action, the official who made the excess allotments will be the 
official responsible for the violation.

(Authority: 31 U.S.C. 1514)

  Use of Official Mail in the Location and Recovery of Missing Children

    Source: 52 FR 10889, Apr. 6, 1987, unless otherwise noted.



Sec. 1.700  Purpose.

    Sections 1.700 through 1.705 of this title provide a Missing 
Children Official Mail Program in the Department of Veterans Affairs.

(Authority: 39 U.S.C. 3220(a)(2), 5 U.S.C. 301)

[60 FR 48387, Sept. 19, 1995]



Sec. 1.701  Contact person for missing children official mail program.

    The Department of Veterans Affairs contact person for the Missing 
Children Official Mail Program is: Mrs. Roslynd R. Stewart, Information 
Management Service (045A4), Office of Policy and Program Assistance, 
Office of Information Resources Management, Office of Management, 
Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 
20420-0001. Telephone: (202) 565-8949.

(Authority: 39 U.S.C. 3220(a)(2), 5 U.S.C. 301)

[60 FR 48388, Sept. 19, 1995]



Sec. 1.702  Policy.

    (a) The Department of Veterans Affairs will supplement and expand 
the national effort to assist in the location and recovery of missing 
children by maximizing the economical use of missing children 
information in domestic official mail and publications directed to 
members of the public and Department of Veterans Affairs employees.
    (b) The Department of Veterans Affairs will insert pictures and 
biographical information related to missing children in a variety of 
official mail originating at the Department of Veterans Affairs 
automation centers. In addition, pictures and biographical information 
are printed in self-mailers and other Department of Veterans Affairs 
publications (newsletters, bulletins, etc.).

[[Page 86]]

    (c) The National Center for Missing and Exploited Children (National 
Center) is the sole source from which the Department of Veterans Affairs 
will acquire the camera-ready and other photographic and biographical 
materials to be disseminated for use by Department of Veterans Affairs 
organizational units. The information is ordered and disseminated by 
Information Management Service.
    (d) The Department of Veterans Affairs will remove all printed 
inserts and other materials from circulation or other use within a 
three-month period from the date the National Center notifies the 
Department of Veterans Affairs that a child whose picture and 
biographical information have been made available to the Department of 
Veterans Affairs has been recovered or that permission of the parent(s) 
or guardian to use the child's photograph and biographical information 
has been withdrawn. The National Center is responsible for immediately 
notifying the Department of Veterans Affairs contact person, in writing, 
of the need to withdraw from circulation official mail and other 
materials related to a particular child. Photographs which were 
reasonably current as of the time of the child's disappearence shall be 
the only acceptable form of visual medium or pictorial likeness used in 
official mail.
    (e) The Department of Veterans Affairs will give priority to 
official mail that is addressed to:
    (1) Members of the public that will be received in the United 
States, its territories and possessions; and
    (2) Inter- and intra-agency publications and other media that will 
also be widely disseminated to Department of Veterans Affairs employees.
    (f) The Department of Veterans Affairs will avoid repetitive 
mailings of material to the same individuals.
    (g) All Department of Veterans Affairs employee suggestions and/or 
recommendations for additional cost-effective opportunities to use 
photographs and biographical data on missing children will be provided 
to the Department of Veterans Affairs contact person.
    (h) These shall be the sole regulations for the Department of 
Veterans Affairs and its component organizational units.

(Authority: 39 U.S.C. 3220(a)(2), 5 U.S.C. 301)

[52 FR 10889, Apr. 6, 1987, as amended at 60 FR 48388, Sept. 19, 1995]



Sec. 1.703  Percentage estimate.

    It is the Department of Veterans Affairs objective that 20 percent 
of its first class official mail addressed to the public contain missing 
children photographs and information.

(Authority: 39 U.S.C. 3220(a)(2), 5 U.S.C. 301)

[60 FR 48388, Sept. 19, 1995]



Sec. 1.704  [Reserved]



Sec. 1.705  Restrictions on use of missing children information.

    Missing children pictures and biographical data shall not be:
    (a) Printed on official envelopes and other materials ordered and 
stocked in quantities that represent more than a 90-day supply.
    (b) Printed on blank pages or covers of publications that may be 
included in the Superintendent of Documents Sales Program or be 
distributed to depository libraries.
    (c) Inserted in any envelope or publication the contents of which 
may be construed to be inappropriate for association with the missing 
children program.
    (d) Inserted in any envelope where the insertion would increase the 
postage cost for the item being mailed.
    (e) Placed on letter-size envelopes on the official indicia, the 
area designated for optical character readers (OCRs), bar code read 
area, and return address area in accordance with the Office of Juvenile 
Justice and Delinquency Prevention guidelines and U.S. Postal Service 
standards.

(Authority: 39 U.S.C. 3220(a)(2), 5 U.S.C. 301)

[52 FR 10889, Apr. 6, 1987, as amended at 60 FR 48388, Sept. 19, 1995]

                           Homeless Claimants



Sec. 1.710  Homeless claimants: Delivery of benefit payments and correspondence.

    (a) All correspondence and all checks for benefits payable to 
claimants under laws administered by the Department

[[Page 87]]

of Veterans Affairs shall be directed to the address specified by the 
claimant. The Department of Veterans Affairs will honor for this purpose 
any address of the claimant in care of another person or organization or 
in care of general delivery at a United States post office. In no event 
will a claim or payment of benefits be denied because the claimant 
provides no mailing address.


(Authority: 38 U.S.C. 5103; 5120)

    (b) To ensure prompt delivery of benefit payments and 
correspondence, claimants who seek personal assistance from Veterans 
Benefits Counselors when filing their claims shall be counseled as to 
the importance of providing his or her current mailing address and, if 
no address is provided, the procedures for delivery described in 
paragraph (d) of this section.


(Authority: 38 U.S.C. 5103; 5120)

    (c) The Department of Veterans Affairs shall prepare and distribute 
to organizations specially serving the needs of veterans and the 
homeless, including but not limited to shelters, kitchens and private 
outreach facilities, information encouraging such organizations to 
counsel individuals on the importance of providing mailing addresses to 
the Department of Veterans Affairs and advising them of this regulation.


(Authority: 38 U.S.C. 5103; 5120)

    (d) If a claimant fails or refuses to provide a current mailing 
address to the Department of Veterans Affairs, all correspondence and 
any checks for benefits to which the claimant is entitled will be 
delivered to the Agent Cashier of the regional office which adjudicated 
or is adjudicating the claim in the case of compensation, pension or 
survivors' benefits, to the Agent Cashier of the Department of Veterans 
Affairs facility closest to the educational institution or training 
establishment attended by a claimant in the case of education benefits, 
or to the Agent Cashier of any other Department of Veterans Affairs 
facility deemed by the Agency to be appropriate under the circumstances 
of the particular case. The claimant, within 30 days after issuance, may 
obtain delivery of any check or correspondence held by an Agent Cashier 
upon presentation of proper identification. Checks unclaimed after 30 
days will be returned to the Department of the Treasury and the 
correspondence to the regional office or facility of jurisdiction. 
Thereafter, the claimant must request the reissuance of any such check 
or item of correspondence by written notice to the Department of 
Veterans Affairs.

(Authority: 38 U.S.C. 5103; 5120)

[53 FR 22654, June 17, 1988]



Sec. Sec. 1.780-1.783  [Reserved]

                   Part-Time Career Employment Program

    Source: 44 FR 55172, Sept. 25, 1979, unless otherwise noted.



Sec. 1.891  Purpose of program.

    Many individuals in society possess great productive potential which 
goes unrealized because they cannot meet the requirements of a standard 
workweek. Permanent part-time employment also provides benefits to other 
individuals in a variety of ways, such as providing older individuals 
with a gradual transition into retirement, providing employment 
opportunities to handicapped individuals or others who requires a 
reduced workweek, providing parents opportunities to balance family 
responsibilities with the need for additional income, and assisting 
students who must finance their own education or vocational training. In 
view of this, the Department of Veterans Affairs will operate a part-
time career employment program, consistent with the needs of its 
beneficiaries and its responsibilities.

(Authority: 5 U.S.C. 3401 note)



Sec. 1.892  Review of positions.

    Positions becoming vacant, unless excepted as provided by Sec. 
1.897, will be reviewed to determine the feasibility of converting them 
to part-time. Among the criteria which may be used when conducting this 
review are:
    (a) Mission requirements.
    (b) Workload.
    (c) Employment ceilings and budgetary considerations.

[[Page 88]]

    (d) Availability of qualified applicants willing to work part time.
    (e) Other criteria based on local needs and circumstances.

(Authority: 5 U.S.C. 3402)



Sec. 1.893  Establishing and converting part-time positions.

    Position management and other internal reviews may indicate that 
positions may be either converted from full-time or initially 
established as part-time positions. Criteria listed in Sec. 1.892 may 
be used during these reviews. If a decision is made to convert to or to 
establish a part-time position, regular position management and 
classification procedures will be followed.

(Authority: 5 U.S.C. 3402)



Sec. 1.894  Annual goals and timetables.

    An departmentwide plan for promoting part-time employment 
opportunities will be developed annually. This plan will establish 
annual goals and set interim and final deadlines for achieving these 
goals. This plan will be applicable throughout the agency, but may be 
supplemented by field facilities.

(Authority: 5 U.S.C. 3402)



Sec. 1.895  Review and evaluation.

    The part-time career employment program will be reviewed through 
regular employment reports to determine levels of part-time employment. 
This program will also be designated an item of special interest to be 
reviewed during personnel management reviews.

(Authority: 5 U.S.C. 3402)

[61 FR 38571, July 25, 1996]



Sec. 1.896  Publicizing vacancies.

    When applicants from outside the Federal service are desired, part-
time vacancies may be publicized through various recruiting means, such 
as:
    (a) Federal Job Information Centers.
    (b) State Employment offices.
    (c) VA Recruiting Bulletins.

(Authority: 5 U.S.C. 3402)



Sec. 1.897  Exceptions.

    The Secretary of Veterans Affairs, or designees, may except 
positions from inclusion in this program as necessary to carry out the 
mission of the Department.

(Authority: 5 U.S.C. 3402)

   Standards for Collection, Compromise, Suspension or Termination of 
  Collection Effort, and Referral of Civil Claims for Money or Property

    Authority: Sections 1.900 through 1.953 are issued under the 
authority of 31 U.S.C. 3711 through 3720E; 38 U.S.C. 501, and as noted 
in specific sections.

    Source: 32 FR 2613, Feb. 8, 1967, unless otherwise noted.



Sec. 1.900  Prescription of standards.

    (a) The standards contained in Sec. Sec. 1.900 through 1.953 are 
issued pursuant to the Federal Claims Collection Standards, issued by 
the Department of the Treasury (Treasury) and the Department of Justice 
(DOJ) in parts 900 through 904 of 31 CFR, as well as other debt 
collection authority issued by Treasury in part 285 of 31 CFR, and apply 
to the collection, compromise, termination, and suspension of debts owed 
to VA, and the referral of such debts to Treasury (or other Federal 
agencies designated by Treasury) for offset and collection action and to 
DOJ for litigation, unless otherwise stated in this part or in other 
statutory or regulatory authority, or by contract.
    (b) Standards and policies regarding the classification of debt for 
accounting purposes (for example, write-off of uncollectible debt) are 
contained in the Office of Management and Budget's Circular A-129 
(Revised), ``Policies for Federal Credit Programs and Non-Tax 
Receivables.''

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62191, Oct. 25, 2004]



Sec. 1.901  No private rights created.

    Sections 1.900 through 1.953 do not create any right or benefit, 
substantive or procedural, enforceable at law or in equity by a party 
against the United States, its agencies, its officers, or any other 
person, nor shall the failure of

[[Page 89]]

VA to comply with any of the provisions of Sec. Sec. 1.900 through 
1.953 be available to any debtor as a defense.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62191, Oct. 25, 2004]



Sec. 1.902  Antitrust, fraud, and tax and interagency claims.

    (a) The standards in Sec. Sec. 1.900 through 1.953 relating to 
compromise, suspension, and termination of collection activity do not 
apply to any debt based in whole or in part on conduct in violation of 
the antitrust laws or to any debt involving fraud, the presentation of a 
false claim, or misrepresentation on the part of the debtor or any party 
having an interest in the claim. Only the Department of Justice (DOJ) 
has the authority to compromise, suspend, or terminate collection 
activity on such claims. The standards in Sec. Sec. 1.900 through 1.953 
relating to the administrative collection of claims do apply, but only 
to the extent authorized by DOJ in a particular case. Upon 
identification of a claim based in whole or in part on conduct in 
violation of the antitrust laws or any claim involving fraud, the 
presentation of a false claim, or misrepresentation on the part of the 
debtor or any party having an interest in the claim, VA shall promptly 
refer the case to DOJ. At its discretion, DOJ may return the claim to VA 
for further handling in accordance with the standards in Sec. Sec. 
1.900 through 1.953.
    (b) Sections 1.900 through 1.953 do not apply to tax debts.
    (c) Sections 1.900 through 1.953 do not apply to claims between 
Federal agencies.
    (d) Federal agencies should attempt to resolve interagency claims by 
negotiation in accordance with Executive Order 12146 (3 CFR, 1980 Comp., 
pp. 409-412).

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.903  Settlement, waiver, or compromise under other statutory or regulatory authority.

    Nothing in Sec. Sec. 1.900 through 1.953 precludes VA settlement, 
waiver, compromise, or other disposition of any claim under statutes and 
implementing regulations other than subchapter II of chapter 37 of Title 
31 of the United States Code (Claims of the United States Government) 
and the standards in Title 31 CFR parts 900 through 904. See, for 
example, the Federal Medical Care Recovery Act (42 U.S.C. 2651 et seq.) 
and applicable regulations, 28 CFR part 43. In such cases, the laws and 
regulations that are specifically applicable to claims collection 
activities of VA generally take precedence over 31 CFR parts 900 through 
904.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.904  Form of payment.

    Claims may be paid in the form of money or, when a contractual basis 
exists, VA may demand the return of specific property or the performance 
of specific services.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.905  Subdivision of claims not authorized.

    Debts may not be subdivided to avoid the monetary ceiling 
established by 31 U.S.C. 3711(a)(2). A debtor's liability arising from a 
particular transaction or contract shall be considered as a single debt 
in determining whether the debt is one of less than $100,000 (excluding 
interest, penalties, and administrative costs) or such higher amount as 
the Attorney General shall from time to time prescribe for purposes of 
compromise, suspension, or termination of collection activity.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.906  Required administrative proceedings.

    (a) In applying Sec. Sec. 1.900 through 1.953, VA is not required 
to omit, foreclose, or duplicate administrative proceedings required by 
contract or other laws or regulations.
    (b) Nothing contained in Sec. Sec. 1.900 through 1.953 is intended 
to foreclose the right of any debtor to an administrative proceeding, 
including appeals, waivers, and hearings provided by statute, contract, 
or VA regulation (see 38

[[Page 90]]

U.S.C. 3720(a)(4) and 5302 and 42 U.S.C. 2651-2653)

(Authority: 38 U.S.C. 501, 3720(a)(4), 5302; 42 U.S.C. 2651 through 
2653)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.907  Definitions.

    (a) The definitions and construction found in the Federal Claims 
Collection Standards in 31 CFR 900.2(a) through (d), and the definitions 
in the provisions on administrative wage garnishment in 31 CFR 285.11(c) 
shall apply to Sec. Sec. 1.900 through 1.953, except as otherwise 
stated.
    (b) As used in Sec. Sec. 1.900 through 1.953, referral for 
litigation means referral to the Department of Justice for appropriate 
legal actions, except in those specified instances where a case is 
referred to a VA Regional Counsel for legal action.
    (c) As used in Sec. Sec. 1.900 through 1.953, VA benefit program 
means medical care, home loan, and benefits payment programs 
administered by VA under Title 38 of the United States Code, except as 
otherwise stated.
    (d) As used in Sec. Sec. 1.900 through 1.953, Treasury means the 
United States Department of the Treasury.

(Authority: 31 U.S.C. 3701, 3711; 38 U.S.C. 501, 5316).

[69 FR 62192, Oct. 25, 2004]

                   Standards for Collection of Claims

    Authority: Sections 1.900 through 1.953 are issued under the 
authority of 31 U.S.C. 3711 through 3720E; 38 U.S.C. 501, and as noted 
in specific sections.

    Source: 32 FR 2613, Feb. 8, 1967, unless otherwise noted.



Sec. 1.910  Aggressive collection action.

    (a) VA will take aggressive collection action on a timely basis, 
with effective follow-up, to collect all claims for money or property 
arising from its activities.
    (b) In accordance with 31 U.S.C. 3711(g) and the procedures set 
forth at 31 CFR 285.12, VA shall transfer to Treasury any non-tax debt 
or claim that has been delinquent for a period of 180 days or more so 
that Treasury may take appropriate action to collect the debt or 
terminate collection action. This requirement does not apply to any debt 
that:
    (1) Is in litigation or foreclosure;
    (2) Will be disposed of under an approved asset sale program;
    (3) Has been referred to a private collection contractor for a 
period of time acceptable to the Secretary of the Treasury;
    (4) Is at a debt collection center for a period of time acceptable 
to the Secretary of the Treasury;
    (5) Will be collected under internal offset procedures within 3 
years after the debt first became delinquent; or
    (6) Is exempt from this requirement based on a determination by the 
Secretary of the Treasury that exemption for a certain class of debt is 
in the best interest of the United States. VA may request that the 
Secretary of the Treasury exempt specific classes of debts.
    (c) In accordance with 31 U.S.C. 3716(c)(6) and the procedures set 
forth in 31 CFR part 285, VA shall notify Treasury of all past due, 
legally enforceable non-tax debt that is over 180 days delinquent for 
purposes of administrative offset, including tax refund offset and 
federal salary offset. (Procedures for referral to Treasury for tax 
refund offset are found at 31 CFR 285.2 and procedures for referral to 
Treasury for federal salary offset are found at 38 CFR 1.995 and 31 CFR 
285.7.)

(Authority: 31 U.S.C. 1311, 1316; 38 U.S.C. 501, 5314; 31 CFR part 285)

[69 FR 62192, Oct. 25, 2004]



Sec. 1.911  Collection of debts owed by reason of participation in a benefits program.

    (a) Scope. This section applies to the collection of debts resulting 
from an individual's participation in a VA benefit or home loan program. 
It does not apply to VA's other debt collection activities. Standards 
for the demand for payment of all other debts owed to VA are set forth 
in Sec. 1.911a. School liability debts are governed by Sec. 21.4009 of 
this title.
    (b) Written demands. When VA has determined that a debt exists by 
reason of an administrative decision or by operation of law, VA shall 
promptly demand, in writing, payment of the debt. VA shall notify the 
debtor of his or her

[[Page 91]]

rights and remedies and the consequences of failure to cooperate with 
collection efforts. Generally, one demand letter is sufficient, but 
subsequent demand letters may be issued as needed.
    (1) The Secretary determines that further demand would be futile;
    (2) The debtor has indicated in writing that he or she does not 
intend to pay the debt;
    (3) Judicial action to protect the Government's interest is 
indicated under the circumstances; or
    (4) Collection by offset pursuant to Sec. 1.912a can be made.
    (c) Rights and remedies. Subject to limitations referred to in this 
paragraph, the debtor has the right to informally dispute the existence 
or amount of the debt, to request waiver of collection of the debt, to a 
hearing on the waiver request, and to appeal the Department of Veterans 
Affairs decision underlying the debt. These rights can be exercised 
separately or simultaneously. Except as provided in Sec. 1.912a 
(collection by offset), the exercise of any of these rights will not 
stay any collection proceeding.
    (1) Informal dispute. This means that the debtor writes to the 
Department of Veterans Affairs and questions whether he or she owes the 
debt or whether the amount is accurate. The Department of Veterans 
Affairs will, as expeditiously as possible, review the accuracy of the 
debt determination. If the resolution is adverse to the debtor, he or 
she may also request waiver of collection as indicated in paragraphs 
(c)(2) and (3) of this section.
    (2) Request for waiver; hearing on request. The debtor has the right 
to request waiver of collection, in accordance with Sec. 1.963 or Sec. 
1.964, and the right to a hearing on the request. Requests for waivers 
must be filed in writing. A waiver request must be filed within the time 
limit set forth in 38 U.S.C. 5302. If waiver is granted, in whole or in 
part, the debtor has a right to refund of amounts already collected up 
to the amount waived.
    (3) Appeal. In accordance with parts 19 and 20 of this title, the 
debtor may appeal the decision underlying the debt.
    (d) Notification. The Department of Veterans Affairs shall notify 
the debtor in writing of the following:
    (1) The exact amount of the debt;
    (2) The specific reasons for the debt, in simple and concise 
language;
    (3) The rights and remedies described in paragraph (c) of this 
section, including a brief explanation of the concept of, and 
requirements for, waiver;
    (4) That collection may be made by offset from current or future VA 
benefit payments (see Sec. 1.912a). In addition, the debtor shall be 
advised of any policies with respect to the use of credit bureaus, debt 
collection centers, and collection agencies; any other remedies to 
enforce payment of the debt, including administrative wage garnishment, 
Federal salary offset, tax refund offset, and litigation; and the 
requirement that any debt delinquent for more than 180 days be 
transferred to Treasury for administrative offset or collection.
    (5) That interest and administrative costs may be assessed in 
accordance with Sec. 1.915, as appropriate;
    (6) That the debtor shall have the opportunity to inspect and copy 
records; and
    (7) That the debtor shall have the opportunity to enter into a 
repayment agreement.
    (e) Sufficiency of notification. Notification is sufficient when 
sent by ordinary mail directed to the debtor's last known address and 
not returned as undeliverable by postal authorities.
    (f) Further explanation. Further explanation may be found for--
    (1) Appellate rights, in parts 19 and 20 of this title;
    (2) Notification of any decision affecting the payment of benefits 
or granting relief, in Sec. 3.103(e);
    (3) Right to appeal a waiver decision, in Sec. 1.958;
    (4) Refund to a successful waiver applicant of money already 
collected, in Sec. 1.967; and
    (5) The assessment of interest and administrative costs, in Sec. 
1.915.

(Authority: 38 U.S.C. 501, 5302, 5314)

[48 FR 1055, Jan. 10, 1983; 48 FR 6336, Feb. 11, 1983. Redesignated and 
amended at 52 FR 42105, Nov. 3, 1987; 54 FR 34980, Aug. 23, 1989; 69 FR 
62193, Oct. 25, 2004]

[[Page 92]]



Sec. 1.911a  Collection of non-benefit debts.

    (a) This section is written in accordance with 31 CFR 901.2 and 
applies to the demand for payment of all debts, except those debts 
arising out of participation in a VA benefit or home loan program. 
Procedures for the demand for payment of VA benefit or home loan program 
debts are set forth in Sec. 1.911.
    (b) Written demand as described in paragraph (c) of this section 
shall be made promptly upon a debtor of VA in terms that inform the 
debtor of the consequences of failing to cooperate with VA to resolve 
the debt. Generally, one demand letter is sufficient, but subsequent 
letters may be issued. In determining the timing of the demand letter, 
VA should give due regard to the need to refer debts promptly to the 
Department of Justice for litigation, in accordance with Sec. Sec. 
1.950 through 1.953. When necessary to protect VA's interest (for 
example, to prevent the running of a statute of limitations), written 
demand may be preceded by other appropriate actions under 38 CFR 1.900 
through 1.953, including immediate referral for litigation.
    (c) The written demand letter shall inform the debtor of:
    (1) The basis for the indebtedness and any rights the debtor may 
have to seek review within VA, including the right to request waiver;
    (2) The applicable standards for imposing any interest or other late 
payment charges;
    (3) The date by which payment should be made to avoid interest and 
other late payment charges and enforced collection, which generally 
should not be more than 30 days from the date that the demand letter is 
mailed;
    (4) The name, address, and phone number of a contact person or 
office within the agency;
    (5) The opportunity to inspect and copy VA records related to the 
debt; and
    (6) The opportunity to make a written agreement to repay the debt.
    (d) In addition to the items listed in paragraph (c) of this 
section, VA should include in the demand letter VA's willingness to 
discuss alternative methods of payment and its policies with respect to 
the use of credit bureaus, debt collection centers, and collection 
agencies. The letter should also indicate the agency's remedies to 
enforce payment of the debt (including assessment of interest, 
administrative costs and penalties, administrative garnishment, Federal 
salary offset, tax refund offset, administrative offset, and litigation) 
and the requirement that any debt delinquent for more than 180 days be 
transferred to Treasury for collection.
    (e) VA should respond promptly to communications from debtors and 
should advise debtors who dispute debts, or request waiver, to furnish 
available evidence to support their contentions.
    (f) Prior to referring a debt for litigation, VA should advise each 
debtor determined to be liable for the debt that, unless the debt can be 
collected administratively, litigation may be initiated. This 
notification may be given as part of a demand letter under paragraph (c) 
of this section or in a separate letter.
    (g) When VA learns that a bankruptcy petition has been filed with 
respect to a debtor, before proceeding with further collection action, 
VA should immediately seek legal advice from either VA's General Counsel 
or Regional Counsel concerning the impact of the Bankruptcy Code on any 
pending or contemplated collection activities. Unless VA determines that 
the automatic stay imposed at the time of filing pursuant to 11 U.S.C. 
362 has been lifted or is no longer in effect, in most cases collection 
activity against the debtor should stop immediately.
    (1) After VA seeks legal advice, a proof of claim should be filed in 
most cases with the bankruptcy court or the Trustee. VA should refer to 
the provisions of 11 U.S.C. 106 relating to the consequences on 
sovereign immunity of filing a proof of claim.
    (2) If VA is a secured creditor, it may seek relief from the 
automatic stay regarding its security, subject to the provisions and 
requirements of 11 U.S.C. 362.
    (3) Offset is prohibited in most cases by the automatic stay. 
However, VA should seek legal advice from VA's General Counsel or 
Regional Counsel to

[[Page 93]]

determine whether payments to the debtor and payments of other agencies 
available for offset may be frozen by VA until relief from the automatic 
stay can be obtained from the bankruptcy court. VA also should seek 
legal advice from VA's General Counsel or Regional Counsel to determine 
whether recoupment is available.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62193, Oct. 25, 2004]



Sec. 1.912  Collection by offset.

    (a) Authority and scope. In accordance with the procedures set forth 
in 31 CFR 901.3, as well as 31 CFR part 285, VA shall collect debts by 
administrative offset from payments made by VA to a debtor indebted to 
VA. Also in accordance with 31 CFR 901.3(b), as well as 31 CFR part 285, 
VA shall refer past due, legally enforceable non-tax debts which are 
over 180 days delinquent to Treasury for collection by centralized 
administrative offset (further procedures are set forth in paragraph (g) 
of this section). This section does not pertain to offset from either VA 
benefit payments made under the authority of 38 U.S.C. 5314 or from 
current salary, but does apply to offset from all other VA payments, 
including an employee's final salary check and lump-sum leave payment. 
Procedures for offset from benefit payments are found in Sec. 1.912a. 
Procedures for offset from current Federal salary are found in 
Sec. Sec. 1.980 through 1.995. NOTE: VA cannot offset, or refer for the 
purpose of offset, either under the authority of this section or under 
any other authority found in Sec. Sec. 1.900 through 1.953 and 
Sec. Sec. 1.980 through 1.995, any VA home loan program debt described 
in 38 U.S.C. 3726 unless the requirements set forth in that section have 
been met.
    (b) Notification. Prior to initiation of administrative offset, if 
not provided in the initial notice of indebtedness, VA is required to 
provide the debtor with written notice of:
    (1) The nature and amount of the debt;
    (2) VA's intention to pursue collection by offset procedures from 
the specified VA payment, the date of commencement of offset, and the 
exact amount to be offset;
    (3) The opportunity to inspect and copy VA records pertaining to the 
debt;
    (4) The right to contest either the existence or amount of the debt 
or the proposed offset schedule, or if applicable, to request a waiver 
of collection of the debt, or to request a hearing on any of these 
matters;
    (5) That commencement of offset will begin, unless the debtor makes 
a written request for the administrative relief discussed in paragraph 
(b)(4) of this section within 30 days of the date of this notice; and
    (6) The oppportunity to enter into a written agreement with VA to 
repay the debt in lieu of offset.
    (c) Deferral of offset. (1) If the debtor, within 30 days of the 
date of the notification required by paragraph (b) of this section, 
disputes in writing the existence or amount of the debt or the amount of 
the scheduled offset, offset shall not commence until the dispute is 
reviewed and a decision is rendered by VA adverse to the debtor.
    (2) If the debtor, within 30 days of the date of the required 
notification by VA, requests in writing the waiver of collection of the 
debt in accordance with Sec. 1.963, Sec. 1.963a, or Sec. 1.964, 
offset shall not commence until VA has made an initial decision to deny 
the waiver request.
    (3) If the debtor, within 30 days of the required notification by 
VA, requests in writing a hearing on the issues found in paragraphs 
(c)(1) and (2) of this section, offset shall not commence until a 
decision is rendered by VA on the issue which is the basis of the 
hearing.
    (d) Exceptions. (1) Offset may commence prior to either resolution 
of a dispute or decision on a waiver request as discussed in paragraph 
(c) of this section, if collection of the debt would be jeopardized by 
deferral of offset (for example, if VA first learns of the debt when 
there is insufficient time before a final payment would be made to the 
debtor to allow for prior notice and opportunity for review or waiver 
consideration). In such a case, notification pursuant to paragraph (b) 
of this section shall be made at the time offset begins or as soon 
thereafter as possible. VA shall promptly refund any money

[[Page 94]]

that has been collected that is ultimately found not to have been owed 
to the Government.
    (2) If the United States has obtained a judgment against the debtor, 
offset may commence without the notification required by paragraph (b) 
of this section. However, a waiver request filed in accordance with the 
time limits and other requirements of Sec. 1.963, Sec. 1.963a, or 
Sec. 1.964 will be considered, even if filed after a judgment has been 
obtained against the debtor. If waiver is granted, in whole or in part, 
refund of amounts already collected will be made in accordance with 
Sec. 1.967.
    (3) The procedures set forth in paragraph (b) of this section may be 
omitted when the debt arises under a contract that provides for notice 
and other procedural protections.
    (4) Offset may commence without the notification required by 
paragraph (b) of this section when the offset is in the nature of a 
recoupment. As defined in 31 CFR 900.2(d), recoupment is a special 
method for adjusting debts arising under the same transaction or 
occurrence.
    (e) Hearing. (1) After a debtor requests a hearing, VA shall notify 
the debtor of the form of the hearing to be provided; i.e., whether the 
hearing will either be oral or paper. If an oral hearing is determined 
to be proper by the hearing official, the notice shall set forth the 
date, time, and location of the hearing. If the hearing is to be a paper 
review, the debtor shall be notified that he or she should submit his or 
her position and arguments in writing to the hearing official by a 
specified date, after which the record shall be closed. This date shall 
give the debtor reasonable time to submit this information.
    (2) Unless otherwise required by law, an oral hearing under this 
paragraph is not required to be a formal evidentiary type of hearing.
    (3) A debtor who requests a hearing shall be provided an oral 
hearing if VA determines that the matter cannot be resolved by review of 
documentary evidence. Whenever an issue of credibility or veracity is 
involved, an oral hearing will always be provided the debtor. For 
example, the credibility or veracity of a debtor is always an issue 
whenever the debtor requests a waiver of collection of the debt. Thus, a 
hearing held in conjunction with a waiver request will always be an oral 
hearing. If a determination is made to provide an oral hearing, the 
hearing official may offer the debtor the opportunity for a hearing by 
telephone conference call. If this offer is rejected or if the hearing 
official declines to offer a telephone conference call, the debtor shall 
be provided an oral hearing permitting the personal appearance of the 
debtor, his or her personal representative, and witnesses. Witnesses 
shall testify under oath or affirmation.
    (4) In all other cases where a debtor requests a hearing, a paper 
hearing shall be provided. The debtor shall be provided an opportunity 
to submit material for the record. A paper hearing shall consist of a 
review of the written evidence of record by the designated hearing 
official.
    (f) Statutes of limitation; multiple debts. When collecting multiple 
debts by administrative offset, VA shall apply the recovered amounts to 
those debts in accordance with the best interests of the United States, 
as determined by the facts and circumstances of the particular case, 
paying special attention to applicable statutes of limitation. In 
accordance with 31 CFR 901.3(a)(4), VA may not initiate offset to 
collect a debt more than 10 years after VA's right to collect the debt 
first accrued (with certain exceptions as specified in 31 CFR 
901.3(a)(4)).
    (g) Centralized administrative offset. (1) When VA refers delinquent 
debts to Treasury for centralized administrative offset in accordance 
with 31 CFR part 285, VA must certify that:
    (i) The debts are past due and legally enforceable; and
    (ii) VA has complied with all due process requirements under 31 
U.S.C. 3716(a) and paragraphs (b) and (c) of this section.
    (2) Payments that are prohibited by law from being offset are exempt 
from centralized administrative offset.
    (h) Computer Matching and Privacy Act waiver. In accordance with 31 
U.S.C. 3716(f), the Secretary of the Treasury may waive the provisions 
of the Computer Matching and Privacy Protection

[[Page 95]]

Act of 1988 concerning matching agreements and post-match notification 
and verification (5 U.S.C. 552a(o) and (p)) for centralized 
administrative offset upon receipt of a certification from a creditor 
agency that the due process requirements enumerated in 31 U.S.C. 3716(a) 
and paragraphs (b) and (c) of this section have been met. The 
certification of a debt in accordance with paragraph (g) of this section 
will satisfy this requirement. If such a waiver is granted, only the 
Data Integrity Board of the Department of the Treasury is required to 
oversee any matching activities, in accordance with 31 U.S.C. 3716(g).
    (i) Requests by creditor agencies for offset. Unless the offset 
would not be in VA's best interest, or would otherwise be contrary to 
law, VA will comply with requests by creditor agencies to offset VA 
payments (except for current salary or benefit payments) made to a 
person indebted to the creditor agency. However, before VA may initiate 
offset, the creditor agency must certify in writing to VA that the 
debtor has been provided:
    (1) Written notice of the type and amount of the debt and the intent 
of the creditor agency to use administrative offset to collect the debt;
    (2) The opportunity to inspect and copy agency records related to 
the debt;
    (3) The opportunity for review within the agency of the 
determination of the indebtedness; and
    (4) The opportunity to make a written agreement to repay the debt.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[52 FR 42105, Nov. 3, 1987, as amended at 54 FR 34980, Aug. 23, 1989; 69 
FR 62194, Oct. 25, 2004]



Sec. 1.912a  Collection by offset--from VA benefit payments.

    (a) Authority and scope. VA shall collect debts governed by Sec. 
1.911 of this part by offset against any current or future VA benefit 
payments to the debtor. Unless paragraphs (c) or (d) of this section 
apply, offset shall commence promptly after notification to the debtor 
as provided in paragraph (b) of this section. Certain military service 
debts shall be collected by offset against current or future 
compensation or pension benefit payments to the debtor under authority 
of 38 U.S.C. 5301(c), as provided in paragraph (e) of this section.
    (b) Notification. Unless paragraph (d) of this section applies, 
offset shall not commence until the debtor has been notified in writing 
of the matters described in Sec. 1.911(c) and (d) and paragraph (c) of 
this section.
    (c) Deferral of offset. (1) If the debtor, within thirty days of the 
date of the notification required by paragraph (b) of this section, 
disputes, in writing, the existence or amount of the debt in accordance 
with Sec. 1.911(c)(1), offset shall not commence until the dispute is 
reviewed as provided in Sec. 1.911(c)(1) and unless the resolution is 
adverse to the debtor.
    (2) If the debtor, within thirty days of the date of notification 
required by paragraph (b) of this section, requests, in writing, waiver 
of collection in accordance with Sec. 1.963 or Sec. 1.964, as 
applicable, offset shall not commence until the Department of Veterans 
Affairs has made an initial decision on waiver.
    (3) If the debtor, within thirty days of the notification required 
by paragraph (b) of this section, requests, in writing, a hearing on the 
waiver request, no decision shall be made on the waiver request until 
after the hearing has been held.
    (4) VA will pursue collection action once an adverse initial 
decision is reached on the debtor's request for waiver and/or the 
debtor's informal dispute (as described in Sec. 1.911(c)(1)) concerning 
the existence or amount of the debt, even if the debtor subsequently 
pursues appellate relief in accordance with parts 19 and 20 of this 
title.
    (d) Exceptions. Offset may commence prior to the resolution of a 
dispute or a decision on a waiver request if collection of the debt 
would be jeopardized by deferral of offset. In such case, notification 
pursuant to Sec. 1.911(d) shall be made at the time offset begins or as 
soon thereafter as possible.


(Authority: 38 U.S.C. 5314, Ch. 37)

    (e) Offset of military service debts. (1) In accordance with 38 
U.S.C. 5301(c), VA shall collect by offset from any current or future 
compensation or pension benefits payable to a veteran under

[[Page 96]]

laws administered by VA, the uncollected portion of the amount of any 
indebtedness associated with the veteran's participation in a plan 
prescribed in subchapter I or II of 10 U.S.C. chapter 73.
    (2) Offsets of a veteran's compensation or pension benefit payments 
to recoup indebtedness to the military services as described in 
paragraph (e)(1) of this section shall only be made by VA when the 
military service owed the debt has:
    (i) Determined the amount of the indebtedness of the veteran;
    (ii) Certified to VA that due process in accordance with the 
procedures prescribed in 31 U.S.C. 3716 have been provided to the 
veteran; and
    (iii) Requested collection of the total debt amount due.
    (3) Offset from any compensation or pension benefits under the 
authority of 38 U.S.C. 5301(c) shall not exceed 15% of the net monthly 
compensation or pension benefit payment. The net monthly compensation or 
pension benefit payment is defined as the authorized monthly 
compensation or pension benefit payment less all current deductions.

(Authority: 38 U.S.C. 5301(c) and 5314)

[48 FR 1055, Jan. 10, 1983, as amended at 52 FR 42106, Nov. 3, 1987; 57 
FR 47263, Oct. 15, 1992; 69 FR 62194, Oct. 25, 2004]



Sec. 1.913  Liquidation of collateral.

    (a) VA should liquidate security or collateral through the exercise 
of a power of sale in the security instrument or a nonjudicial 
foreclosure, and apply the proceeds to the applicable debt, if the 
debtor fails to pay the debt within 180 days after demand and if such 
action is in the best interest of the United States. Collection from 
other sources, including liquidation of security or collateral, is not a 
prerequisite to requiring payment by a surety, insurer, or guarantor, 
unless such action is expressly required by statute or contract.
    (b) When VA learns that a bankruptcy petition has been filed with 
respect to a debtor, VA should seek legal advice from VA's General 
Counsel or Regional Counsel concerning the impact of the Bankruptcy 
Code, including, but not limited to, 11 U.S.C. 362, to determine the 
applicability of the automatic stay and the procedures for obtaining 
relief from such stay prior to proceeding under paragraph (a) of this 
section.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62195, Oct. 25, 2004]



Sec. 1.914  Collection in installments.

    (a) Whenever feasible, VA shall collect the total amount of a debt 
in one lump sum. If a debtor is financially unable to pay a debt in one 
lump sum, VA may accept payment in regular installments. VA should 
obtain financial statements from debtors who represent that they are 
unable to pay in one lump sum and independently verify such 
representations whenever possible. If VA agrees to accept payments in 
regular installments, VA should obtain a legally enforceable written 
agreement from the debtor that specifies all of the terms of the 
arrangement and contains a provision accelerating the debt in the event 
of default.
    (b) The size and frequency of installment payments should bear a 
reasonable relation to the size of the debt and the debtor's ability to 
pay. If possible, the installment payments should be sufficient in size 
and frequency to liquidate the debt in 3 years or less.
    (c) Security for deferred payments should be obtained in appropriate 
cases. However, VA may accept installment payments if the debtor refuses 
to execute a written agreement or to give security.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62195, Oct. 25, 2004]



Sec. 1.915  Interest, administrative costs, and penalties.

    (a) Except as otherwise provided by statute, contract, or other 
regulation to the contrary, and subject to 38 U.S.C. 3485(e) and 5302, 
VA shall assess:
    (1) Interest on all indebtedness to the United States arising out of 
participation in a VA benefit, medical care, or home loan program under 
authority of Title 38, U.S. Code.
    (2) Interest and administrative costs of collection on such debts 
described in paragraph (a)(1) of this section where repayment has become 
delinquent (as defined in 31 CFR 900.2(b)), and

[[Page 97]]

    (3) Interest, administrative costs, and penalties in accordance with 
31 CFR 901.9 on all debts other than those described in paragraph (a)(1) 
of this section.
    (b) Every party entering into an agreement with the Department of 
Veterans Affairs for repayment of indebtedness in installments shall be 
advised of the interest charges to be added to the debt. All debtors 
being provided notice of indebtedness, including those entering into 
repayment agreements, shall be advised that upon the debt becoming 
delinquent, or in the case of repayment of already delinquent debts, 
interest and the administrative costs of collection will be added to the 
principal amount of the debt.
    (c) The rate of interest charged by VA shall be based on the rate 
established annually by the Secretary of the Treasury in accordance with 
31 U.S.C. 3717 and shall be adjusted annually by VA on the first day of 
the calendar year. Once the rate of interest has been determined for a 
particular debt, the rate shall remain in effect throughout the duration 
of repayment of that debt. When a debtor defaults on a repayment 
agreement and seeks to enter into a new agreement, VA may require 
payment of interest at a new rate that reflects the current value of 
funds to the Treasury at the time the new agreement is executed. 
Interest shall not be compounded, that is, interest shall not be charged 
on accrued interest and administrative costs required by this section. 
If, however, a debtor defaults on a previous repayment agreement, 
interest and administrative costs that accrued but were not collected 
under the defaulted agreement shall be added to the principal under the 
new agreement.
    (d) Interest on amounts covered by this section shall accrue from 
the date the initial notice of the debt is mailed to the debtor. 
Notification shall be considered sufficient when effected by ordinary 
mail, addressed to the last known address, and such notice is not 
returned as undeliverable by postal authorities.
    (e) Interest under this section shall not be charged if the debt is 
paid in full within 30 days of mailing of the initial notice described 
in paragraph (b) of this section. Once interest begins to accrue, and 
after expiration of the time period for payment of the debt in full to 
avoid assessment of interest and administrative costs, any amount 
received toward the payment of such debt shall be first applied to 
payment of outstanding administrative cost charges and then to accrued 
interest or costs, and then to principal, unless a different rule is 
prescribed by statute, contract, or other regulation.
    (f) All or any part of the interest and administrative costs 
assessed under this section are subject to consideration for waiver 
under section 5302 of title 38 U.S.C., and appropriate administrative 
procedures.
    (1) In general, interest and administrative costs may be waived only 
when the principal of the debt on which they are assessed is waived by a 
Committee on Waivers and Compromises. However, VA may forbear collection 
of interest and administrative costs, exclusive of collection of the 
principal of the debt on which they are assessed, as well as terminate 
further assessment of interest and administrative costs when the 
collection of such interest and costs are determined to be not in the 
government's best interest. Collection of interest and administrative 
costs shall not be considered to be in the best interest of the 
government when the amount of assessed interest and administrative cost 
is so large that there is a reasonable certainty that the original debt 
will never be repaid. The determination to forbear collection of 
interest and administrative cost, exclusive of collection of the 
principal of the debt, shall be made by the Chief of the Fiscal activity 
at the station responsible for the collection of the debt. Such a 
determination is not within the jurisdiction of a Committee on Waivers 
and Compromises.
    (2) [Reserved]
    (g) Administrative costs assessed under this section shall be the 
average costs of collection of similar debts, or actual collection costs 
as may be accurately determined in the particular case. No 
administrative costs of collection will be assessed under this section 
in any cases where the indebtedness is paid in full prior to the 30-day 
period specified in paragraph (e) of this section, or in any case where 
a repayment

[[Page 98]]

plan is proposed by the debtor and accepted by VA within that 30-day 
period, unless such repayment agreement becomes delinquent (as defined 
in 31 CFR 900.2(b)).

(Authority: 31 U.S.C. 3717; 38 U.S.C. 501, 5302, 5315)

[46 FR 62057, Dec. 22, 1981, as amended at 52 FR 42107, Nov. 3, 1987. 
Redesignated and amended at 69 FR 62195, Oct. 25, 2004]



Sec. 1.916  Disclosure of debt information to consumer reporting agencies (CRA).

    (a) The Department of Veterans Affairs may disclose all information 
determined to be necessary, including the name, address, Department of 
Veterans Affairs file number, Social Security number, and date of birth, 
to consumer reporting agencies for the purpose of--
    (1) Obtaining the location of an individual indebted to the United 
States as a result of participation in any benefits program administered 
by VA or indebted in any other manner to VA;
    (2) Obtaining a consumer report in order to assess an individuals 
ability to repay a debt when such individual has failed to respond to 
the Department's demand for repayment or when such individual has 
notified the Department that he/she will not repay the indebtedness; or
    (3) Obtaining the location of an individual in order to conduct 
program evaluation studies as required by 38 U.S.C. 527 or any other 
law.
    (b) Information disclosed by the Department of Veterans Affairs 
under paragraph (a) of this section to consumer reporting agencies shall 
neither expressly nor implicitly indicate that an individual is indebted 
to the United States nor shall such information be recorded by consumer 
reporting agencies in a manner that reflects adversely upon the 
individual. Prior to disclosing this information, the Department of 
Veterans Affairs shall ascertain that consumer reporting agencies with 
which it contracts are able to comply with this requirement. The 
Department of Veterans Affairs shall also make reasonable efforts to 
insure compliance by its contractor with this requirement.
    (c) Subject to the conditions set forth in paragraph (d) of this 
section, information concerning individuals may be disclosed to consumer 
reporting agencies for inclusion in consumer reports pertaining to the 
individual, or for the purpose of locating the individual. Disclosure of 
the fact of indebtedness will be made if the individual fails to respond 
in accordance with written demands for repayment, or refuses to repay a 
debt to the United States. In making any disclosure under this section, 
VA will provide consumer reporting agencies with sufficient information 
to identify the individual, including the individual's name, address, if 
known, date of birth, VA file number, and Social Security number.
    (d)(1) Prior to releasing information under paragraph (c) of this 
section, the Department of Veterans Affairs will send a notice to the 
individual. This notice will inform the individual that--
    (i) The Department of Veterans Affairs has determined that he or she 
is indebted to the Department of Veterans Affairs;
    (ii) The debt is presently delinquent; and
    (iii) The fact of delinquency may be reported to consumer reporting 
agencies after 30 days have elapsed from the date of the notice.
    (2)(i) In accordance with Sec. 1.911 and Sec. 1.911a, VA shall 
notify each individual of the right to dispute the existence and amount 
of the debt and to request a waiver of the debt, if applicable.
    (ii) If the Department of Veterans Affairs has not previously 
notified the individual of the rights described in paragraph (d)(2)(i) 
of this section, the Department of Veterans Affairs will include this 
information in the notice described in paragraph (d)(1) of this section. 
The individual shall be afforded a minimum of 30 days from the date of 
the notice to respond to it before information is reported to consumer 
reporting agencies.
    (3) The Department of Veterans Affairs will defer reporting 
information to a consumer reporting agency if the individual disputes 
the existence or amount of any debt or requests waiver of the debt 
within the time limits set forth in paragraph (d)(2)(ii) of this 
section. The Department of Veterans Affairs will review any dispute and 
notify the individual of its findings. If the

[[Page 99]]

original decision is determined to be correct, or if the individual's 
request for waiver is denied, the Department of Veterans Affairs may 
report the fact of delinquency to a consumer reporting agency. However, 
the individual shall be afforded 30 days from date of the notice of the 
agency's determination to repay the debt.
    (4) Nothing in this section affects an individual's right to appeal 
an agency decision to the Board of Veterans Appeals. However, 
information concerning the debt may be disclosed while an appeal is 
pending before the Board of Veterans Appeals.
    (5) Upon request, the Department of Veterans Affairs will notify an 
individual--
    (i) Whether information concerning a debt has been reported to 
consumer reporting agencies;
    (ii) Of the name and address of each consumer reporting agency to 
which information has been released; and
    (iii) Of the specific information released.

A notice of the right to request this information will be sent with the 
notice described in paragraph (d)(1) of this section.
    (e) Subsequent to disclosure of information to consumer reporting 
agencies as described in paragraph (c) of this section, the Department 
of Veterans Affairs shall:
    (1) Notify on a monthly basis each consumer reporting agency 
concerned of any substantial change in the status or amount of 
indebtedness.
    (2) Promptly verify any and all information disclosed if so 
requested by the consumer reporting agency concerned.
    (f) In the absence of a different rule prescribed by statute, 
contract, or other regulation, an indebtedness is considered delinquent 
if not paid by the individual by the date due specified in the notice of 
indebtedness, unless satisfactory arrangements are made by such date.
    (g) Notification shall be considered sufficient when effected by 
ordinary mail, addressed to the last known address, and such notice is 
not returned as undeliverable by postal authorities.
    (h) The Privacy Act (5 U.S.C. 552a) does not apply to any contract 
between the Department of Veterans Affairs and a consumer reporting 
agency, nor does it apply to a consumer reporting agency and its 
employees. See 38 U.S.C. 5701(i). This paragraph does not relieve the 
Department of Veterans Affairs of its obligation to comply with the 
Privacy Act.
    (i) The term ``consumer reporting agency'' means any person or 
agency which, for monetary fees, dues, or on a cooperative nonprofit 
basis, regularly engages in whole or in part in the practice of 
assembling or evaluating consumer credit information or other 
information on consumers for the purpose of furnishing consumer reports 
to third parties or to other consumer reporting agencies. The term 
``consumer reporting agency'' shall also mean any person or agency which 
serves as a marketing agent under arrangements enabling third parties to 
obtain such information from consumer reporting agencies, or which 
obtain such information for the purpose of furnishing it to consumer 
reporting agencies.

(Authority: 31 U.S.C. 3711(e); 38 U.S.C. 501, 5701(g) and (i))

[46 FR 62058, Dec. 22, 1981, as amended at 52 FR 42107, Nov. 3, 1987. 
Redesignated and amended at 69 FR 62195, Oct. 25, 2004]



Sec. 1.917  Contracting for collection services.

    (a) VA has authority to contract for collection services to recover 
delinquent debts, provided that:
    (1) The authority to resolve disputes, compromise claims, suspend or 
terminate collection and refer the matter for litigation shall be 
retained by VA;
    (2) The contractor shall be subject to 38 U.S.C. 5701, and to the 
Privacy Act of 1974, as amended, to the extent specified in 5 U.S.C. 
552a(m), and to applicable Federal and State laws and regulations 
pertaining to debt collection practices, such as the Fair Debt 
Collection Practices Act, 15 U.S.C. 1692 et seq.
    (3) The contractor shall be required to strictly account for all 
amounts collected;
    (4) Upon returning an account to VA for subsequent referral to the 
Department of Justice for litigation, the contractor must agree to 
provide any data contained in its files relating to Sec. 1.951.
    (b) In accordance with 31 U.S.C. 3718(d), or as otherwise permitted 
by

[[Page 100]]

law, collection service contracts may be funded in the following manner:
    (1) VA may fund a collection service contract on a fixed-fee basis 
(i.e., payment of a fixed fee determined without regard to the amount 
actually collected under the contract). Payment of the fee under this 
type of contract must be charged to available appropriations;
    (2) VA may also fund a collection service contract on a contingent-
fee basis (i.e., by including a provision in the contract permitting the 
contractor to deduct its fee from amounts collected under the contract). 
The fee should be based upon a percentage of the amount collected, 
consistent with prevailing commercial practice;
    (3) VA may enter into a contract under paragraph (b)(1) of this 
section only if and to the extent that funding for the contract is 
provided for in advance by an appropriation act or other legislation, 
except that this requirement does not apply to the use of a revolving 
fund authorized by statute;
    (4) Except as authorized under paragraphs (b)(2) and (b)(5) of this 
section, or unless otherwise specifically provided by law, VA shall 
deposit all amounts recovered under collection service contracts for 
Loan Guaranty debts into the Loan Guaranty Revolving Fund, and for all 
other debts in the Treasury as miscellaneous receipts pursuant to 31 
U.S.C. 3302.
    (5) For benefit overpayments recovered under collection service 
contract, VA, pursuant to 31 U.S.C. 3302, shall deposit:
    (i) Amounts equal to the original overpayments in the appropriations 
account from which the overpayments were made, and
    (ii) Amount of interest or administrative costs in the Treasury as 
miscellaneous receipts.
    (c) VA shall use government-wide debt collection contracts to obtain 
debt collection services provided by private collection contractors. 
However, VA may refer debts to private collection contractors pursuant 
to a contract between VA and a private collection contractor only if 
such debts are not subject to the requirement to transfer debts to 
Treasury for debt collection. See 31 U.S.C. 3711(g), 31 CFR 285.12(e), 
and 38 CFR 1.910.
    (d) VA may enter into contracts for locating and recovering assets 
of the United States, such as unclaimed assets.
    (e) VA may enter into contracts for debtor asset and income search 
reports. In accordance with 31 U.S.C. 3718(d), such contracts may 
provide that the fee a contractor charges the agency for such services 
may be payable from the amounts recovered, unless otherwise prohibited 
by statute.

(Authority: 31 U.S.C. 3718; 38 U.S.C. 501)

[52 FR 42107, Nov. 3, 1987. Redesignated and amended at 69 FR 62195, 
Oct. 25, 2004]



Sec. 1.918  Use and disclosure of mailing addresses.

    (a) When attempting to locate a debtor in order to compromise or 
collect a debt in accordance with Sec. Sec. 1.900 through 1.953, VA may 
send a request to the Secretary of the Treasury, or his/her designee, in 
order to obtain the debtor's most current mailing address from the 
records of the Internal Revenue Service.
    (b) VA is authorized to use mailing addresses obtained under 
paragraph (a) of this section to enforce collection of a delinquent debt 
and may disclose such mailing addresses to other agencies and to 
collection agencies for collection purposes.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[52 FR 42108, Nov. 3, 1987. Redesignated and amended at 69 FR 62196, 
Oct. 25, 2004]



Sec. 1.919  Administrative offset against amounts payable from Civil Service Retirement and Disability Fund, Federal Employees Retirement System (FERS), final 
          salary check, and lump sum leave payments.

    (a) Unless otherwise prohibited by law or regulation, and in 
accordance with 31 CFR 901.3(d), VA may request that money which is due 
and payable to a debtor from either the Civil Service Retirement and 
Disability Fund or FERS be administratively offset in reasonable amounts 
in order to collect, in one full payment or a minimal number of 
payments, debts that are owed to VA by the debtor. Such requests shall 
be made to the appropriate officials at

[[Page 101]]

the Office of Personnel Management (OPM) in accordance with such 
regulations prescribed by the Director of OPM. (See 5 CFR 831.1801 
through 831.1808). In addition, VA may also offset against a Federal 
employee's final salary check and lump sum leave payment. See Sec. 
1.912 for procedures for offset against a final salary check and lump 
sum leave payment.
    (b) When making a request to the Office of Personnel Management for 
administrative offset under paragraph (a) of this section, VA shall 
include a written certification that:
    (1) The debtor owes VA a debt, including the amount of the debt;
    (2) VA has complied with the applicable statutes, regulations, and 
procedures of the Office of Personnel Management; and
    (3) VA has complied with Sec. Sec. 1.911, 1.911a, 1.912, 1.912a, 
and 31 CFR 901.3, to the extent applicable, including any required 
hearing or review.
    (c) Once VA decides to request administrative offset from the Civil 
Service Retirement and Disability Fund or Federal Employees Retirement 
System (FERS) under paragraph (a) of this section, it shall make the 
request as soon as possible after completion of the applicable 
procedures in order that the Office of Personnel Management may identify 
the debtor's account in anticipation of the time when the debtor 
requests or becomes eligible to receive payments from the Fund or FERS. 
This will satisfy any requirement that offset be initiated prior to 
expiration of the applicable statutes of limitations. At such time as 
the debtor makes a claim for payments from the Fund or FERS, if at least 
a year has elapsed since the offset request was originally made, the 
debtor should be permitted to offer a satisfactory repayment plan in 
lieu of offset upon establishing that such offset will create financial 
hardship.
    (d) If VA collects all or part of the debt by other means before 
deductions are made or completed in accordance with paragraph (a) of 
this section, VA shall promptly act to modify or terminate its request 
for offset under paragraph (a) of this section.
    (e) The Office of Personnel Management is neither required nor 
authorized by this section to review the merits of VA's determination 
with respect to the amount and validity of the debt waiver under 5 
U.S.C. 5584 or 38 U.S.C. 5302, or providing or not providing an oral 
hearing.

(Authority: 5 U.S.C. 8461; 31 U.S.C. 3711, 3716; 38 U.S.C. 501)

[52 FR 42108, Nov. 3, 1987. Redesignated and amended at 69 FR 62196, 
Oct. 25, 2004]



Sec. 1.920  Referral of VA debts.

    (a) When authorized, VA may refer an uncollectible debt to another 
Federal or State agency for the purpose of collection action. Collection 
action may include the offsetting of the debt from any current or future 
payment, except salary (see paragraph (e) of this section), made by such 
Federal or State agency to the person indebted to VA.
    (b) VA must certify in writing that the individual owes the debt, 
the amount and basis of the debt, the date on which payment became due, 
and the date VA's right to collect the debt first accrued.
    (c) This certification will also state that VA provided the debtor 
with written notice of:
    (1) The nature and amount of the debt;
    (2) VA's intention to pursue collection by offset procedures;
    (3) The opportunity to inspect and copy VA records pertaining to the 
debt;
    (4) The right to contest both the existence and amount of the debt 
and to request a waiver of collection of the debt (if applicable), as 
well as the right to a hearing on both matters;
    (5) The opportunity to enter into a written agreement with VA for 
the repayment of the debt; and
    (6) Other applicable notices required by Sec. Sec. 1.911, 1.911a, 
1.912, and 1.912a.
    (d) The written certification required by paragraphs (b) and (c) of 
this section will also contain (for all debts) a listing of all actions 
taken by both VA and the debtor subsequent to the notice, as well as the 
dates of such actions.
    (e) The referral by VA of a VA debt to another agency for the 
purpose of salary offset shall be done in accordance with 38 CFR 1.980 
through 1.995

[[Page 102]]

and regulations prescribed by the Director of the Office of Personnel 
Management (OPM) in 5 CFR part 550, subpart K.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[52 FR 42108, Nov. 3, 1987. Redesignated and amended at 69 FR 62196, 
Oct. 25, 2004]



Sec. 1.921  Analysis of costs.

    VA collection procedures should provide for periodic comparison of 
costs incurred and amounts collected. Data on costs and corresponding 
recovery rates for debts of different types and in various dollar ranges 
should be used to compare the cost effectiveness of alternative 
collection techniques, establish guidelines with respect to points at 
which costs of further collection efforts are likely to exceed 
recoveries, assist in evaluating offers in compromise, and establish 
minimum debt amounts below which collection efforts need not be taken.

(Authority: 31 U.S.C. 3711-3719; 38 U.S.C. 501)

[69 FR 62196, Oct. 25, 2004]



Sec. 1.922  Exemptions.

    (a) Sections 1.900 through 1.953, to the extent they reflect 
remedies or procedures prescribed by the Debt Collection Act of 1982 and 
the Debt Collection Improvement Act of 1996, such as administrative 
offset, use of credit bureaus, contracting for collection agencies, and 
interest and related charges, do not apply to debts arising under, or 
payments made under, the Internal Revenue Code of 1986, as amended (26 
U.S.C. 1 et seq.); the Social Security Act (42 U.S.C. 301 et seq.), 
except to the extent provided under 42 U.S.C. 404 and 31 U.S.C. 3716(c); 
or the tariff laws of the United States. These remedies and procedures, 
however, may be authorized with respect to debts that are exempt from 
the Debt Collection Act of 1982 and the DCIA of 1996, to the extent that 
they are authorized under some other statute or the common law.
    (b) This section should not be construed as prohibiting the use of 
Sec. Sec. 1.900 through 1.953 when collecting debts owed by persons 
employed by agencies administering the laws cited in paragraph (a) of 
this section unless the debt arose under those laws.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501).

[69 FR 62196, Oct. 25, 2004]



Sec. 1.923  Administrative wage garnishment.

    (a) In accordance with the procedures set forth in 31 U.S.C. 3720D 
and 31 CFR 285.11, VA or Treasury may request that a non-Federal 
employer garnish the disposable pay of an individual to collect 
delinquent non-tax debt owed to VA. VA may pursue wage garnishment 
independently in accordance with this section or VA or Treasury may 
pursue garnishment after VA refers a debt to Treasury in accordance with 
Sec. 1.910 of this part and 31 CFR 285.12. For the purposes of this 
section, any reference to Treasury also includes any private collection 
agency under contract to Treasury.
    (b) At least 30 days prior to the initiation of garnishment 
proceedings, VA or Treasury shall send a written notice, as described in 
31 CFR 285.11(e), by first class mail to the debtor's last known 
address. This notice shall inform the debtor of:
    (1) The nature and amount of the debt;
    (2) The intention of VA or Treasury to initiate proceedings to 
collect the debt through deductions from the debtor's pay until the debt 
and all accumulated interest, and other late payment charges, are paid 
in full, and;
    (3) An explanation of the debtor's rights, including the 
opportunity:
    (i) To inspect and copy VA records pertaining to the debt;
    (ii) To enter into a written repayment agreement with VA or Treasury 
under terms agreeable to VA or Treasury, and;
    (iii) To a hearing in accordance with 31 CFR 285.11(f) and paragraph 
(c) of this section concerning the existence or amount of the debt or 
the terms of the proposed repayment schedule under the garnishment 
order. However, the debtor is not entitled to a hearing concerning the 
terms of the proposed repayment schedule if these terms have been 
established by written agreement under paragraph (b)(3)(ii) of this 
section.

[[Page 103]]

    (c) Any hearing conducted as part of the administrative wage 
garnishment process shall be conducted by the designated hearing 
official in accordance with the procedures set forth in 31 CFR 
285.11(f). This hearing official may be any VA hearing official. This 
hearing official may also conduct administrative wage garnishment 
hearings for other Federal agencies.
    (1) The hearing may be oral or written as determined by the 
designated hearing official. The hearing official shall provide the 
debtor with a reasonable opportunity for an oral hearing when the 
hearing official determines that the issue in dispute cannot be resolved 
by review of documentary evidence, for example, when the validity of the 
claim turns on the issue of credibility or veracity. The hearing 
official shall establish the time and place of any oral hearing. At the 
debtor's option, an oral hearing may be conducted either in person or by 
telephone conference call. A hearing is not required to be a formal, 
evidentiary-type hearing, but witnesses who testify in oral hearings 
must do so under oath or affirmation. While it is not necessary to 
produce a transcript of the hearing, the hearing official must maintain 
a summary record of the proceedings. All travel expenses incurred by the 
debtor in connection with an in-person hearing shall be borne by the 
debtor. VA or Treasury shall be responsible for all telephone expenses. 
In the absence of good cause shown, a debtor who fails to appear at a 
hearing will be deemed as not having timely filed a request for a 
hearing.
    (2) If the hearing official determines that an oral hearing is not 
necessary, then he/she shall afford the debtor a ``paper hearing.'' In a 
``paper hearing,'' the hearing official will decide the issues in 
dispute based upon a review of the written record.
    (3) If the debtor's written request for a hearing is received by 
either VA or Treasury within 15 business days following the mailing of 
the notice described in paragraph (b) of this section, then VA or 
Treasury shall not issue a withholding order as described in paragraph 
(d) of this section until the debtor is afforded the requested hearing 
and a decision rendered. If the debtor's written request for a hearing 
is not received within 15 business days following the mailing of the 
notice described in paragraph (b) of this section, then the hearing 
official shall provide a hearing to the debtor, but will not delay 
issuance of a withholding order as described in paragraph (d) of this 
section, unless the hearing official determines that the delay in filing 
was caused by factors beyond the debtor's control.
    (4) The hearing official shall notify the debtor of:
    (i) The date and time of a telephone conference hearing;
    (ii) The date, time, and location of an in-person oral hearing, or;
    (iii) The deadline for the submission of evidence for a written 
hearing.
    (5) Except as provided in paragraph (c)(6)of this section, VA or 
Treasury shall have the burden of going forward to prove the existence 
or amount of the debt, after which the debtor must show, by a 
preponderance of the evidence, that no debt exists or that the amount of 
the debt is incorrect. In general, this means that the debtor must show 
that it is more likely than not that a debt does not exist or that the 
amount of the debt is incorrect. The debtor may also present evidence 
that terms of the repayment agreement are unlawful, would cause a 
financial hardship, or that collection of the debt may not be pursued 
due to operation of law.
    (6) If the debtor has previously contested the existence and/or 
amount of the debt in accordance with Sec. 1.911(c)(1) or Sec. 
1.911a(c)(1) and VA subsequently rendered a decision upholding the 
existence or amount of the debt, then such decision shall be 
incorporated by reference and become the basis of the hearing official's 
decision on such matters.
    (7) The hearing official shall issue a written decision as soon as 
practicable, but not later than 60 days after the date on which the 
request for such hearing was received by VA or Treasury. The decision 
will be the final action for the purposes of judicial review under the 
Administrative Procedure Act (5 U.S.C. 701 et seq.). The decision shall 
include:
    (i) A summary of the facts presented;

[[Page 104]]

    (ii) The hearing official's findings, analysis, and conclusions, 
and;
    (iii) The terms of the repayment schedule, if applicable.
    (d) In accordance with 31 CFR 285.11(g) and (h), VA or Treasury 
shall send a Treasury-approved withholding order and certification form 
by first class mail to the debtor's employer within 30 days after the 
debtor fails to make a timely request for a hearing. If a timely request 
for a hearing has been filed by the debtor, then VA or Treasury shall 
send a withholding order and certification form by first class mail to 
the debtor's employer within 30 days after a final decision is made to 
proceed with the garnishment. The employer shall complete and return the 
certification form as described in 31 CFR 285.11(h).
    (e) After receipt of the garnishment order, the employer shall 
withhold the amount of garnishment as described in 31 CFR 285.11(i) from 
all disposable pay payable to the applicable debtor during each pay 
period.
    (f) A debtor whose wages are subject to a wage withholding order 
under 31 CFR 285.11 may request a review, under the procedures set forth 
in 31 CFR 285.11(k), of the amount garnished. A request for review shall 
only be considered after garnishment has been initiated. The request 
must be based on materially changed circumstances such as disability, 
divorce, or catastrophic illness which result in financial hardship that 
limit the debtor's ability to provide food, housing, clothing, 
transportation, and medical care for himself/herself and his/her 
dependents.

(Authority: 31 U.S.C. 3720D; 38 U.S.C. 501; 31 CFR 285.11)

[69 FR 62196, Oct. 25, 2004, as amended at 72 FR 65462, Nov. 21, 2007]



Sec. 1.924  Suspension or revocation of eligibility for federal loans, loan insurance, loan guarantees, licenses, permits, or privileges.

    (a) In accordance with 31 U.S.C. 3720B and the procedures set forth 
in 31 CFR 285.13 and Sec. 901.6, a person owing an outstanding non-tax 
debt that is in delinquent status shall not be eligible for Federal 
financial assistance unless exempted under paragraph (d) of this section 
or waived under paragraph (e) of this section.
    (b) Federal financial assistance or financial assistance means any 
Federal loan (other than a disaster loan), loan insurance, or loan 
guarantee.
    (c) For the purposes of this section only, a debt is in a delinquent 
status if the debt has not been paid within 90 days of the payment due 
date or by the end of any grace period provided by statute, regulation, 
contract, or agreement. The payment due date is the date specified in 
the initial written demand for payment. Further guidance concerning the 
delinquent status of a debt may be found at 31 CFR 285.13(d).
    (d) Upon the written request and recommendation of the Secretary of 
Veterans Affairs, the Secretary of the Treasury may grant exemptions 
from the provisions of this section. The standards for exemptions 
granted for classes of debts are set forth in 31 CFR 285.13(f).
    (e)(1) VA's Chief Financial Officer or Deputy Chief Financial 
Officer may waive the provisions of paragraph (a) of this section only 
on a person-by-person basis.
    (2) The Chief Financial Officer or Deputy Chief Financial Officer 
should balance the following factors when deciding whether to grant a 
waiver:
    (i) Whether the denial of the financial assistance to the person 
would tend to interfere substantially with or defeat the purposes of the 
financial assistance program or otherwise would not be in the best 
interests of the Federal government; and
    (ii) Whether the granting of the financial assistance to the person 
is contrary to the government's goal of reducing losses by requiring 
proper screening of potential borrowers.
    (3) When balancing the factors described in paragraph (e)(2)(i) and 
(e)(2)(ii) of this section, the Chief Financial Officer or Deputy Chief 
Financial Officer should consider:
    (i) The age, amount, and cause(s) of the delinquency and the 
likelihood that the person will resolve the delinquent debt; and
    (ii) The amount of the total debt, delinquent or otherwise, owed by 
the person and the person's credit history with respect to repayment of 
debt.

[[Page 105]]

    (4) A centralized record shall be retained of the number and type of 
waivers granted under this section.
    (f) In non-bankruptcy cases, in seeking the collection of statutory 
penalties, forfeitures, or other similar types of claims, VA may suspend 
or revoke any license, permit, or other privilege granted a debtor when 
the debtor inexcusably or willfully fails to pay such a debt. The debtor 
should be advised in VA's written demand for payment of VA's ability to 
suspend or revoke licenses, permits, or privileges. VA may suspend or 
disqualify any lender, contractor, or broker who is engaged in making, 
guaranteeing, insuring, acquiring, or participating in loans from doing 
further business with VA or engaging in programs sponsored by VA if such 
lender, contractor, or broker fails to pay its debts to the Government 
within a reasonable time, or if such lender, contractor, or broker has 
been suspended, debarred, or disqualified from participation in a 
program or activity by another Federal agency. The failure of any surety 
to honor its obligations in accordance with 31 U.S.C. 9305 should be 
reported to Treasury.
    (g) In bankruptcy cases, before advising the debtor of the intention 
to suspend or revoke licenses, permits, or privileges, VA should seek 
legal advice from VA's General Counsel or Regional Counsel concerning 
the impact of the Bankruptcy Code, particularly 11 U.S.C. 362 and 525, 
which may restrict such action.

(Authority: 31 U.S.C. 3720B; 38 U.S.C. 501)

[69 FR 62197, Oct. 25, 2004]



Sec. 1.929  Reduction of debt through performance of work-study services.

    (a) Scope. (1) Subject to the provisions of this section VA may 
allow an individual to reduce an indebtedness to the United States 
through offset of benefits to which the individual becomes entitled by 
performance of work-study services under 38 U.S.C. 3485 and 3537 when 
the debt arose by virtue of the individual's participation in a benefits 
program provided under any of the following:
    (i) 38 U.S.C. chapter 30;
    (ii) 38 U.S.C. chapter 31;
    (iii) 38 U.S.C. chapter 32;
    (iv) 38 U.S.C. chapter 34;
    (v) 38 U.S.C. chapter 35;
    (vi) 38 U.S.C. chapter 36 (other than an education loan provided 
under subpart F, part 21 of this title); or
    (vii) 10 U.S.C. chapter 1606 (other than an indebtedness arising 
from a refund penalty imposed under 10 U.S.C. 16135).
    (2) This section shall not apply in any case in which the individual 
has a pending request for waiver of the debt under Sec. Sec. 1.950 
through 1.970.


(Authority: 38 U.S.C. 3485(e)(1); Pub. L. 102-16)

    (b) Selection criteria. (1) If there are more candidates for a work-
study allowance than there are work-study positions available in the 
area in which the services are to be performed, VA will give priority to 
the candidates who are pursuing a program of education or 
rehabilitation.
    (2) Only after all candidates in the area described in paragraph 
(b)(1) of this section either have been given work-study contracts or 
have withdrawn their request for contracts will VA offer contracts to 
those who are not pursuing a program of education or rehabilitation and 
who wish to reduce their indebtedness through performance of work-study 
services.
    (3) VA shall not offer a contract to an individual who is receiving 
compensation from another source for the work-study services the 
individual wishes to perform.
    (4) VA shall not offer a contract to an individual if VA determines 
that the debt can be collected through other means such as collection in 
a lump sum, collection in installments as provided in Sec. 1.917 or 
compromise as provided in Sec. 1.918.


(Authority: 38 U.S.C. 3485(e); Pub. L. 102-16)

    (c) Utilization. The work-study services to be performed under a 
debt-liquidation contract will be limited as follows:
    (1) If the individual is concurrently receiving educational 
assistance in a program administered by VA, work-study services are 
limited to those allowed in the educational program

[[Page 106]]

under which the individual is receiving benefits.
    (2) If the individual is not concurrently receiving educational 
assistance in a program administered by VA, the individual may perform 
only those work-study services and activities which are or were open to 
those students receiving a work-study allowance while pursuing a program 
of education pursuant to the chapter under which the debt was incurred.


(Authority: 38 U.S.C. 3485(e); Pub. L. 102-16)

    (d) Contract to perform services. (1) The work-study services 
performed to reduce indebtedness shall be performed pursuant to a 
contract between the individual and VA.
    (2) The individual shall perform the work-study services required by 
the contract at the place or places designated by VA.
    (3) The number of hours of services to be performed under the 
contract must be sufficient to enable the individual to become entitled 
to a sum large enough to liquidate the debt by offset.
    (4) The number of weeks in the contract will not exceed the lesser 
of--
    (i) The number of weeks of services the individual needs to perform 
to liquidate his or her debt; or
    (ii) 52.
    (5) In determining the number of hours per week and the number of 
weeks under paragraphs (d)(3) and (d)(4) of this section necessary to 
liquidate the debt, VA will use the amount of the account receivable, 
including all accrued interest, administrative costs and marshall fees 
outstanding on the date the contract is offered to the individual and 
all accrued interest, administrative costs and marshall fees VA 
estimates will have become outstanding on the debt on the date the debt 
is to be liquidated.
    (6) The contract will automatically terminate after the total amount 
of the individual's indebtedness described in paragraph (d)(5) of this 
section has been recouped, waived, or otherwise liquidated. An 
individual performing work-study services under a contract to liquidate 
a debt is released from the contract if the debt is liquidated by other 
means.
    (7) The contract to perform work-study services for the purpose of 
liquidating indebtedness will be terminated if:
    (i) The individual is liquidating his or her debt under this section 
while receiving either an educational assistance allowance for further 
pursuit of a program of education or a subsistence allowance for further 
pursuit of a program of rehabilitation;
    (ii) The individual terminates or reduces the rate of pursuit of his 
or her program of education or rehabilitation; and
    (iii) The termination or reduction causes an account receivable as a 
debt owed by the individual.
    (8) VA may terminate the contract at any time the individual fails 
to perform the services required by the contract in a satisfactory 
manner.


(Authority: 38 U.S.C. 3485(e), 7104(a); Pub. L. 102-16)

    (e) Reduction of indebtedness. (1) In return for the individual's 
agreement to perform hours of services totaling not more than 40 times 
the number of weeks in the contract, VA will reduce the eligible 
person's outstanding indebtedness by an amount equal to the higher of--
    (i) The hourly minimum wage in effect under section 6(a) of the Fair 
Labor Standards Act of 1938 times the number of hours the individual 
works; or
    (ii) The hourly minimum wage under comparable law of the State in 
which the services are performed times the number of hours the 
individual works.
    (2) VA will reduce the individual's debt by the amount of the money 
earned for the performance of work-study services after the completion 
of each 50 hours of services (or in the case of any remaining hours 
required by the contract, the amount for those hours).


(Authority: 38 U.S.C. 3485(e); Pub. L. 102-16)

    (f) Suspension of collections by offset. Notwithstanding the 
provisions of Sec. 1.912a, during the period covered by the work-study 
debt-liquidation contract with the individual, VA will ordinarily 
suspend the collection by offset of a debt described in paragraph (a)(1) 
of this section. However, the individual

[[Page 107]]

may voluntarily permit VA to collect part of the debt through offset 
against other benefits payable while the individual is performing work-
study services. If the contract is terminated before its scheduled 
completion date, and the debt has not been liquidated, collection 
through offset against other benefits payable will resume on the date 
the contract terminates.


(Authority: 38 U.S.C. 3485(e); Pub. L. 102-16)

    (g) Payment for additional hours. (1) If an individual, without 
fault on his or her part, performs work-study services for which payment 
may not be authorized, including services performed after termination of 
the contract, VA will pay the individual at the applicable hourly 
minimum wage for such services as the Director of the VA field station 
of jurisdiction determines were satisfactorily performed.
    (2) The Director of the VA field station of jurisdiction shall 
determine whether the individual was without fault. In making this 
decision he or she shall consider all evidence of record and any 
additional evidence which the individual wishes to submit.

(Authority: 38 U.S.C. 3485(e); Pub. L. 102-16)

[62 FR 15401, Apr. 1, 1997]

                   Standards for Compromise of Claims

    Authority: Sections 1.900 through 1.953 are issued under the 
authority of 31 U.S.C. 3711 through 3720E; 38 U.S.C. 501, and as noted 
in specific sections.

    Source: 32 FR 2614, Feb. 8, 1967, unless otherwise noted.



Sec. 1.930  Scope and application.

    (a) The standards set forth in Sec. Sec. 1.930 through 1.936 of 
this part apply to the compromise of debts pursuant to 31 U.S.C. 3711. 
VA may exercise such compromise authority when the amount of the debt 
due, exclusive of interest, penalties, and administrative costs, does 
not exceed $100,000 or any higher amount authorized by the Attorney 
General.
    (b) Unless otherwise provided by law, when the principal balance of 
a debt, exclusive of interest, penalties, and administrative costs, 
exceeds $100,000 or any higher amount authorized by the Attorney 
General, the authority to accept the compromise rests with the 
Department of Justice (DOJ). If VA receives an offer to compromise any 
debt in excess of $100,000, VA should evaluate the compromise offer 
using the same factors as set forth in Sec. 1.931 of this part. If VA 
believes the offer has merit, it shall refer the debt to the Civil 
Division or other appropriate division in DOJ using a Claims Collection 
Litigation Report (CCLR). The referral shall include appropriate 
financial information and a recommendation for the acceptance of the 
compromise offer. DOJ approval is not required if VA decides to reject a 
compromise offer.
    (c) The $100,000 limit in paragraph (b) of this section does not 
apply to debts that arise out of participation in a VA loan program 
under Chapter 37 of Title 38 of the U.S. Code. VA has unlimited 
authority to compromise debts arising out of participation in a Chapter 
37 loan program, regardless of the amount of the debt.

(Authority: 31 U.S.C. 3711; 38 U.S.C 501, 3720)

[69 FR 62198, Oct. 25, 2004]



Sec. 1.931  Bases for compromise.

    (a) VA may compromise a debt if it cannot collect the full amount 
because:
    (1) The debtor is unable to pay the full amount in a reasonable 
time, as verified through credit reports or other financial information;
    (2) VA is unable to collect the debt in full within a reasonable 
time by enforced collection proceedings;
    (3) The cost of collecting the debt does not justify the enforced 
collection of the full amount; or
    (4) There is significant doubt concerning VA's ability to prove its 
case in court.
    (b) In determining the debtor's inability to pay, VA will consider 
relevant factors such as the following:
    (1) Age and health of the debtor;
    (2) Present and potential income;
    (3) Inheritance prospects;
    (4) The possibility that assets have been concealed or improperly 
transferred by the debtor; and
    (5) The availability of assets or income that may be realized by 
enforced collection proceedings.

[[Page 108]]

    (c) VA will verify the debtor's claim of inability to pay by using a 
credit report and other financial information as provided in paragraph 
(g) of this section. VA should consider the applicable exemptions 
available to the debtor under State and Federal law in determining the 
ability to enforce collection. VA also may consider uncertainty as to 
the price that collateral or other property will bring at a forced sale 
in determining the ability to enforce collection. A compromise effected 
under this section should be for an amount that bears a reasonable 
relation to the amount that can be recovered by enforced collection 
procedures, with regard to the exemptions available to the debtor and 
the time that collection will take.
    (d) If there is significant doubt concerning VA's ability to prove 
its case in court for the full amount claimed, either because of the 
legal issues involved or because of a bona fide dispute as to the facts, 
then the amount accepted in compromise of such cases should fairly 
reflect the probabilities of successful prosecution to judgment, with 
due regard given to the availability of witnesses and other evidentiary 
support for VA's claim. In determining the risks involved in litigation, 
VA will consider the probable amount of court costs and attorney fees 
pursuant to the Equal Access to Justice Act, 28 U.S.C. 2412, that may be 
imposed against the Government if it is unsuccessful in litigation.
    (e) VA may compromise a debt if the cost of collecting the debt does 
not justify the enforced collection of the full amount. The amount 
accepted in compromise in such cases may reflect an appropriate discount 
for the administrative and litigative costs of collection, with 
consideration given to the time it will take to effect collection. 
Collection costs may be a substantial factor in the settlement of small 
debts. In determining whether the cost of collecting justifies enforced 
collection of the full amount, VA will consider whether continued 
collection of the debt, regardless of cost, is necessary to further an 
enforcement principle.
    (f) VA generally will not accept compromises payable in 
installments. If, however, payment of a compromise in installments is 
necessary, VA will obtain a legally enforceable written agreement 
providing that, in the event of default, the full original principal 
balance of the debt prior to compromise, less sums paid thereon, is 
reinstated. Whenever possible, VA will also obtain security for 
repayment.
    (g) To assess the merits of a compromise offer based in whole or in 
part on the debtor's inability to pay the full amount of a debt within a 
reasonable time, VA will obtain a current financial statement from the 
debtor showing the debtor's assets, liabilities, income, and expenses. 
Agencies also may obtain credit reports or other financial information 
to assess compromise offers.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]



Sec. 1.932  Enforcement policy.

    VA may compromise statutory penalties, forfeitures, or claims 
established as an aid to enforcement and to compel compliance, if VA's 
enforcement policy in terms of deterrence and securing compliance, 
present and future, will be adequately served by VA's acceptance of the 
sum to be agreed upon.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]



Sec. 1.933  Joint and several liability.

    (a) When two or more debtors are jointly and severally liable, VA 
will pursue collection activity against all debtors, as appropriate. VA 
will not attempt to allocate the burden of payment between the debtors 
but should proceed to liquidate the indebtedness as quickly as possible.
    (b) VA will ensure that a compromise agreement with one debtor does 
not release VA's claim against the remaining debtors. The amount of a 
compromise with one debtor shall not be considered a precedent or 
binding in determining the amount that will be required from other 
debtors jointly and severally liable on the claim.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]

[[Page 109]]



Sec. 1.934  Further review of compromise offers.

    If VA is uncertain whether to accept a firm, written, substantive 
compromise offer on a debt that is within its delegated compromise 
authority, it may refer the offer to VA General Counsel or Regional 
Counsel or to the Civil Division or other appropriate division in the 
Department of Justice (DOJ), using a Claims Collection Litigation Report 
(CCLR) accompanied by supporting data and particulars concerning the 
debt. DOJ may act upon such an offer or return it to the agency with 
instructions or advice.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]



Sec. 1.935  Consideration of tax consequences to the Government.

    In negotiating a compromise, VA will consider the tax consequences 
to the Government. In particular, VA will consider requiring a waiver of 
tax-loss-carry-forward and tax-loss-carry-back rights of the debtor.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]



Sec. 1.936  Mutual releases of the debtor and VA.

    In all appropriate instances, a compromise that is accepted by VA 
shall be implemented by means of a mutual release, in which the debtor 
is released from further non-tax liability on the compromised debt in 
consideration of payment in full of the compromise amount, and VA and 
its officials, past and present, are released and discharged from any 
and all claims and causes of action that the debtor may have arising 
from the same transaction. In the event a mutual release is not executed 
when a debt is compromised, unless prohibited by law, the debtor is 
still deemed to have waived any and all claims and causes of action 
against VA and its officials related to the transaction giving rise to 
the compromised debt.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[69 FR 62198, Oct. 25, 2004]

        Standards for Suspending or Terminating Collection Action

    Authority: Sections 1.900 through 1.953 are issued under the 
authority of 31 U.S.C. 3711 through 3720E; 38 U.S.C. 501, and as noted 
in specific sections.

    Source: 32 FR 2615, Feb. 8, 1967, unless otherwise noted.



Sec. 1.940  Scope and application.

    (a) The standards set forth in Sec. Sec. 1.940 through 1.944 apply 
to the suspension or termination of collection activity pursuant to 31 
U.S.C. 3711 on debts that do not exceed $100,000, or such other amount 
as the Attorney General may direct, exclusive of interest, penalties, 
and administrative costs, after deducting the amount of partial payments 
or collections, if any. Prior to referring a debt to the Department of 
Justice (DOJ) for litigation, VA may suspend or terminate collection 
under this part with respect to the debt.
    (b) If, after deducting the amount of any partial payments or 
collections, the principal amount of a debt exceeds $100,000, or such 
other amount as the Attorney General may direct, exclusive of interest, 
penalties, and administrative costs, the authority to suspend or 
terminate rests solely with DOJ. If VA believes that suspension or 
termination of any debt in excess of $100,000 may be appropriate, it 
shall refer the debt to the Civil Division or other appropriate division 
in DOJ, using the Claims Collection Litigation Report (CCLR). The 
referral should specify the reasons for VA's recommendation. If, prior 
to referral to DOJ, VA determines that a debt is plainly erroneous or 
clearly without legal merit, VA may terminate collection activity 
regardless of the amount involved without obtaining DOJ concurrence.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62199, Oct. 25, 2004]



Sec. 1.941  Suspension of collection activity.

    (a) VA may suspend collection activity on a debt when:
    (1) It cannot locate the debtor;
    (2) The debtor's financial condition is expected to improve; or

[[Page 110]]

    (3) The debtor has requested a waiver or review of the debt.
    (b) Based on the current financial condition of the debtor, VA may 
suspend collection activity on a debt when the debtor's future prospects 
justify retention of the debt for periodic review and collection 
activity and:
    (1) The applicable statute of limitations has not expired; or
    (2) Future collection can be effected by administrative offset, 
notwithstanding the expiration of the applicable statute of limitations 
for litigation of claims, and with due regard to the 10-year limitation 
for administrative offset prescribed by 31 U.S.C. 3716(e)(1); or
    (3) The debtor agrees to pay interest on the amount of the debt on 
which collection will be suspended, and such suspension is likely to 
enhance the debtor's ability to pay the full amount of the principal of 
the debt with interest at a later date.
    (c) Collection action may also be suspended, in accordance with 
Sec. Sec. 1.911, 1.911a, 1.912, and 1.912a, pending VA action on 
requests for administrative review of the existence or amount of the 
debt or a request for waiver of collection of the debt. However, 
collection action will be resumed once VA issues an initial decision on 
the administrative review or waiver request.
    (d) When VA learns that a bankruptcy petition has been filed with 
respect to a debtor, in most cases the collection activity on a debt 
must be suspended, pursuant to the provisions of 11 U.S.C. 362, 1201, 
and 1301, unless VA can clearly establish that the automatic stay does 
not apply, has been lifted, or is no longer in effect. VA shall seek 
legal advice immediately from either the VA General Counsel or Regional 
Counsel and, if legally permitted, take the necessary steps to ensure 
that no funds or money are paid by VA to the debtor until relief from 
the automatic stay is obtained.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62199, Oct. 25, 2004]



Sec. 1.942  Termination of collection activity.

    Termination of collection activity involves a final determination. 
Collection activity may be terminated on cases previously suspended. The 
Department of Veterans Affairs may terminate collection activity and 
consider closing the agency file on a claim which meets any one of the 
following standards:
    (a) Inability to collect any substantial amount. Collection action 
may be terminated on a claim when it becomes clear that VA cannot 
collect or enforce collection of any significant amount from the debtor, 
having due regard for the judicial remedies available to the agency, the 
debtor's future financial prospects, and the exemptions available to the 
debtor under State and Federal law. In determining the debtor's 
inability to pay, the following factors, among others, shall be 
considered: Age and health of the debtor, present and potential income, 
inheritance prospects, the possibility that assets have been concealed 
or improperly transferred by the debtor, the availability of assets or 
income which may be realized by means of enforced collection 
proceedings.
    (b) Inability to locate debtor. The debtor cannot be located, no 
security remains to be liquidated, the applicable statute of limitations 
has run, and the prospects of collecting by offset are too remote.
    (c) Death of debtor. The debtor is determined to be deceased and the 
Government has no prospect of collection from his/her estate.
    (d) Cost will exceed recovery. The cost of further collection effort 
is likely to exceed the amount recoverable.
    (e) Claim legally without merit. Collection action should be 
terminated on a claim whenever it is determined that the claim is 
legally without merit.
    (f) Claim cannot be substantiated by evidence. VA will terminate 
collection action on once asserted claims because of lack of evidence or 
unavailability of witnesses only in cases where efforts to induce 
voluntary payment are unsuccessful.
    (g) Discharge in bankruptcy. Generally, VA shall terminate 
collection activity on a debt that has been discharged in bankruptcy, 
regardless of the amount. VA may continue collection activity, subject 
to the provisions

[[Page 111]]

of the Bankruptcy Code, for any payments provided under a plan of 
reorganization. Offset and recoupment rights may survive the discharge 
of the debtor in bankruptcy and, under some circumstances, claims also 
may survive the discharge.
    (h) Before terminating collection activity, VA should have pursued 
all appropriate means of collection and determined, based upon the 
results of the collection activity, that the debt is uncollectible. 
Termination of collection activity ceases active collection of the debt. 
The termination of collection activity does not preclude VA from 
retaining a record of the account for purposes of:
    (1) Selling the debt, if the Secretary of the Treasury determines 
that such sale is in the best interests of the United States;
    (2) Pursuing collection at a subsequent date in the event there is a 
change in the debtor's status or a new collection tool becomes 
available;
    (3) Offsetting against future income or assets not available at the 
time of termination of collection activity; or
    (4) Screening future applicants for prior indebtedness.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[32 FR 2615, Feb. 8, 1967, as amended at 52 FR 42111, Nov. 3, 1987; 69 
FR 62200, Oct. 25, 2004]



Sec. 1.943  Exception to termination.

    When a significant enforcement policy is involved, or recovery of a 
judgment is a prerequisite to the imposition of administrative 
sanctions, VA may refer debts for litigation even though termination of 
collection activity may otherwise be appropriate.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]



Sec. 1.944  Discharge of indebtedness; reporting requirements.

    (a) Before discharging a delinquent debt (also referred to as a 
close out of the debt), VA shall take all appropriate steps to collect 
the debt in accordance with 31 U.S.C. 3711(g), including, as applicable, 
administrative offset, tax refund offset, Federal salary offset, 
referral to Treasury or Treasury-designated debt collection centers or 
private collection contractors, credit bureau reporting, wage 
garnishment, litigation, and foreclosure. Discharge of indebtedness is 
distinct from termination or suspension of collection activity under 
Sec. Sec. 1.940 through 1.943 and is governed by the Internal Revenue 
Code (see 26 U.S.C. 6050P). When collection action on a debt is 
suspended or terminated, the debt remains delinquent and further 
collection action may be pursued at a later date in accordance with the 
standards set forth in Sec. Sec. 1.900 through 1.953. When VA 
discharges a debt in full or in part, further collection action is 
prohibited. Therefore, VA should make the determination that collection 
action is no longer warranted before discharging a debt. Before 
discharging a debt, VA must terminate debt collection action.
    (b) Upon discharge of an indebtedness, VA must report the discharge 
to the Internal Revenue Service (IRS) in accordance with the 
requirements of 26 U.S.C. 6050P and 26 CFR 1.6050P-1. VA may request 
Treasury or Treasury-designated debt collection centers to file such a 
discharge report to the IRS on VA's behalf.
    (c) When discharging a debt, VA must request that any liens of 
record securing the debt be released.
    (d) 31 U.S.C. 3711(i)(2) requires agencies to sell a delinquent 
nontax debt upon termination of collection action if the Secretary of 
the Treasury determines such a sale is in the best interests of the 
United States. Since the discharge of a debt precludes any further 
collection action (including the sale of a delinquent debt), VA may not 
discharge a debt until the requirements of Sec. 3711(i)(2) have been 
met.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]

             Referrals to GAO, Department of Justice, or IRS

    Authority: Sections 1.900 through 1.953 are issued under the 
authority of 31 U.S.C. 3711 through 3720E; 38 U.S.C. 501, and as noted 
in specific sections.

    Source: 52 FR 42111, 42112, Nov. 3, 1987, unless otherwise noted.

[[Page 112]]



Sec. 1.950  Prompt referral.

    (a) VA shall promptly refer debts to Department of Justice (DOJ) for 
litigation where aggressive collection activity has been taken in 
accordance with Sec. Sec. 1.900 through 1.953, and such debts cannot be 
compromised, or on which collection activity cannot be suspended or 
terminated, in accordance with Sec. Sec. 1.930 through 1.936 and 
Sec. Sec. 1.940 through 1.944. Debts for which the principal amount is 
over $1,000,000, or such other amount as the Attorney General may 
direct, exclusive of interest and other late payment charges, shall be 
referred to the Civil Division or other division responsible for 
litigating such debts at DOJ. Debts for which the principal amount is 
$1,000,000, or less, or such other amount as the Attorney General may 
direct, exclusive of interest or penalties, shall be referred to DOJ's 
Nationwide Central Intake Facility as required by the Claims Collection 
Litigation Report (CCLR) instructions. Debts should be referred as early 
as possible, consistent with aggressive agency collection activity and 
the observance of the standards contained in Sec. Sec. 1.900 through 
1.953, and, in any event, well within the period for initiating timely 
lawsuits against the debtors. VA shall make every effort to refer 
delinquent debts to DOJ for litigation within 1 year of the date such 
debts last became delinquent. In the case of guaranteed or insured 
loans, VA should make every effort to refer these delinquent debts to 
DOJ for litigation within 1 year from the date the loan was presented to 
VA for payment or reinsurance.
    (b) DOJ has exclusive jurisdiction over the debts referred to it 
pursuant to this section. VA shall immediately terminate the use of any 
administrative collection activities to collect a debt at the time of 
the referral of that debt to DOJ. VA should advise DOJ of the collection 
activities that have been utilized to date, and their result. VA shall 
refrain from having any contact with the debtor and shall direct all 
debtor inquiries concerning the debt to DOJ. VA shall immediately notify 
DOJ of any payments credited to the debtor's account after referral of a 
debt under this section. DOJ shall notify VA, in a timely manner, of any 
payments it receives from the debtor.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]



Sec. 1.951  Claims Collection Litigation Report (CCLR).

    (a) Unless excepted by the Department of Justice (DOJ), VA shall 
complete the CCLR, accompanied by a signed Certificate of Indebtedness, 
to refer all administratively uncollectible claims to DOJ for 
litigation. VA shall complete all of the sections of the CCLR 
appropriate to each claim as required by the CCLR instructions and 
furnish such other information as may be required in specific cases.
    (b) VA shall indicate clearly on the CCLR the actions it wishes DOJ 
to take with respect to the referred claim.
    (c) VA shall also use the CCLR to refer claims to DOJ to obtain 
approval of any proposals to compromise the claims or to suspend or 
terminate agency collection activity.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]



Sec. 1.952  Preservation of evidence.

    VA must take care to preserve all files and records that may be 
needed by the Department of Justice (DOJ) to prove its claims in court. 
VA ordinarily should include certified copies of the documents that form 
the basis for the claim when referring such claims to DOJ for 
litigation. VA shall provide originals of such documents immediately 
upon request by DOJ.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]



Sec. 1.953  Minimum amount of referrals to the Department of Justice.

    (a) Except as otherwise provided in paragraphs (b) and (c) of this 
section, VA shall not refer for litigation claims of less than $2,500, 
exclusive of interest, penalties, and administrative costs, or such 
other minimum amount as the Attorney General shall from time to time 
prescribe. The Department of Justice (DOJ) shall promptly notify 
referring agencies if the Attorney General changes this minimum amount.

[[Page 113]]

    (b) VA shall not refer claims of less than the minimum amount 
prescribed by the Attorney General unless:
    (1) Litigation to collect such smaller claims is important to ensure 
compliance with VA's policies or programs;
    (2) The claim is being referred solely for the purpose of securing a 
judgment against the debtor, which will be filed as a lien against the 
debtor's property pursuant to 28 U.S.C. 3201 and returned to VA for 
enforcement; or
    (3) The debtor has the clear ability to pay the claim and the 
Government effectively can enforce payment, with due regard for the 
exemptions available to the debtor under State and Federal law and the 
judicial remedies available to the Government.
    (c) VA should consult with the Financial Litigation Staff of the 
Executive Office for United States Attorneys, in DOJ, prior to referring 
claims valued at less than the minimum amount.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501)

[69 FR 62200, Oct. 25, 2004]



Sec. 1.955  Regional office Committees on Waivers and Compromises.

    (a) Delegation of authority and establishment. (1) Sections 1.955 et 
seq. are issued to implement the authority for waiver consideration 
found in 38 U.S.C. 5302 and 5 U.S.C. 5584 and the compromise authority 
found 38 U.S.C. 3720(a) and 31 U.S.C. 3711. The duties, delegations of 
authority, and all actions required of the Committees on Waivers and 
Compromises are to be accomplished under the direction of, and authority 
vested in, the Director of the regional office. Delegations of authority 
and limitations for waiver actions under 5 U.S.C. 5584 are set forth in 
Sec. 1.963a of this part.
    (2) There is established in each regional office, a Committee on 
Waivers and Compromises to perform the duties and assume the 
responsibilities delegated by Sec. Sec. 1.956 and 1.957. The term 
regional office, as used in Sec. 1.955 et seq., includes VA Medical and 
Regional Office Centers and VA Centers where such are established.
    (b) Selection. The Director shall designate the employees to serve 
as Chairperson, members, and alternates. Except upon specific 
authorization of the Under Secretary for Benefits, when workload 
warrants a full-time committee, such designation will be part-time 
additional duty upon call of the Chairperson.
    (c) Control and staff. The administrative control of each Committee 
on Waivers and Compromises is the responsibility of the station's Fiscal 
Officer. However, the station Director has the authority to reassign the 
administrative control function to another station activity, rather than 
the Fiscal Officer, whenever the Director determines that such 
reassignment is appropriate. The quality control of the professional and 
clerical staff of the Committee is the responsibility of the 
Chairperson.
    (d) Overall control. The Assistant Secretary for Management is 
delegated complete management authority, including planning, policy 
formulation, control, coordination, supervision, and evaluation of 
Committee operations.
    (e) Committee composition. (1) The Committee shall consist of a 
Chairperson and Alternate Chairperson and as many Committee members and 
alternate members as the Director may appoint. Members and alternates 
shall be selected so that in each of the debt claim areas (i.e., 
compensation, pension, education, insurance, loan guaranty, etc.) there 
are members and alternates with special competence and familiarity with 
the program area.
    (2) When a claim is properly referred to the Committee for either 
waiver consideration or the consideration of a compromise offer, the 
Chairperson shall designate a panel from the available Committee members 
to consider the waiver request or compromise offer. If the debt for 
which the waiver request or compromise offer is made is $20,000 or less 
(exclusive or interest and administrative costs), the Chairperson will 
assign one Committee member as the panel. This one Committee member 
should have experience in the program area where the debt is located. 
The single panel member's decision shall stand as the decision of the 
Committee. If the debt for which the waiver request or compromise offer 
is made is more than $20,000 (exclusive of interest and administrative 
costs), the Chairperson shall assign two Committee members.

[[Page 114]]

One of the two members should be knowledgeable in the program area where 
the debt arose. If the two member panel cannot reach a unanimous 
decision, the Chairperson shall assign a third member of the Committee 
to the panel, or assign the case to three new members, and the majority 
vote shall determine the Committee decision.
    (3) The assignment of a one or two member panel as described in 
paragraph (e)(2) of this section is applicable if the debtor files a 
Notice of Disagreement with a Committee decision to deny waiver. That 
is, if the Notice of Disagreement is filed with a decision by a one 
member panel to deny waiver of collection of a debt of $20,000 or less, 
then the Notice of Disagreement should also be assigned to one panel 
member. Likewise, a Notice of Disagreement filed with a decision by a 
two or three member panel to deny waiver of collection of a debt of more 
than $20,000 should also be assigned to a Committee panel of two members 
(three if these two members cannot agree). However, a Chairperson must 
assign the Notice of Disagreement to a different one, two, or three 
member panel than the panel that made the original Committee decision 
that is now the subject of the Notice of Disagreement.

(Authority: 5 U.S.C. 5584, 31 U.S.C. 3711, 38 U.S.C. 3720(a), 5302)

[44 FR 59905, Oct. 17, 1979, as amended at 48 FR 1056, Jan. 10, 1983; 54 
FR 40871, Oct. 4, 1989; 57 FR 47264, Oct. 15, 1992; 60 FR 53276, Oct. 
13, 1995; 69 FR 62201, Oct. 25, 2004]



Sec. 1.956  Jurisdiction.

    (a) The regional office Committees are authorized, except as to 
determinations under Sec. 2.6(e)(4)(i) of this chapter where 
applicable, to consider and determine as limited in Sec. Sec. 1.955 et 
seq., settlement, compromise and/or waiver concerning the following 
debts and overpayments:
    (1) Arising out of operations of the Veterans Benefits 
Administration:
    (i) Overpayment or erroneous payments of pension, compensation, 
dependency and indemnity compensation, burial allowances, plot 
allowance, subsistence allowance, education (includes debts from work 
study and education loan defaults as well as from other overpayments of 
educational assistance benefits) or insurance benefits, clothing 
allowance and automobile or other conveyance and adaptive equipment 
allowances.
    (ii) Debts arising out of the loan program under 38 U.S.C. ch. 37 
after liquidation of security, if any.
    (iii) Such other debts as may be specifically designated by the 
Under Secretary for Benefits.
    (2) Arising out of operations of the Veterans Health Services and 
Research Administration:
    (i) Debts resulting from services furnished in error (Sec. 
17.101(a) of this chapter).
    (ii) Debts resulting from services furnished in a medical emergency 
(Sec. 17.101(b) of this chapter).
    (iii) Other claims arising in connection with transactions of the 
Veterans Health Administration (Sec. 17.103(c) of this chapter).
    (iv) Fiscal officers at VA medical facilities are authorized to 
waive veterans' debts arising from medical care copayments (Sec. 
17.105(c) of this chapter).
    (3) Claims for erroneous payments of pay and allowances, and 
erroneous payments of travel, transportation, and relocation expenses 
and allowances, made to or on behalf of employees (5 U.S.C. 5584).
    (b) The Under Secretary for Benefits may, at his or her discretion, 
assume original jurisdiction and establish an ad hoc Board to determine 
a particular issue arising within this section.

(Authority: 38 U.S.C. 501)

[39 FR 26400, July 19, 1974, as amended at 44 FR 59905, Oct. 17, 1979; 
60 FR 53276, Oct. 13, 1995; 69 FR 62201, Oct. 25, 2004]



Sec. 1.957  Committee authority.

    (a) Regional office committee. On matters covered in Sec. 1.956, 
the regional office Committee is authorized to determine the following 
issues:
    (1) Waivers. A decision may be rendered to grant or deny waiver of 
collection of a debt in the following debt categories:
    (i) Loan guaranty program (38 U.S.C. 5302(b)). Committees may 
consider waiver of the indebtedness of a veteran or spouse resulting 
from: (A) The payment of a claim under the guaranty or insurance of 
loans, (B) the liquidation

[[Page 115]]

of direct loans, (C) the liquidation of loans acquired under Sec. 
36.4318, and (D) the liquidation of vendee accounts. The phrase veteran 
or spouse includes a veteran-borrower, veteran-transferee, a veteran-
purchaser on a vendee account, a former spouse or surviving spouse of a 
veteran.
    (ii) Other than loan guaranty program. (38 U.S.C. 5302(a))
    (iii) Services erroneously furnished (Sec. 17.101(a)).
    (2) Compromises--(i) Loan program debts (38 U.S.C. 3720(a)). Accept 
or reject a compromise offer irrespective of the amount of the debt 
(loan program matters under 38 U.S.C. chapter 37 are unlimited as to 
amount).
    (ii) Other than loan program debts (31 U.S.C. 3711).
    (A) Accept or reject a compromise offer on a debt which exceeds 
$1,000 but which is not over $100,000 (both amounts exclusive of 
interest and other late payment charges).
    (B) Accept or reject a compromise offer on a debt of a $1,000 or 
less, exclusive of interest and other late payment charges, which is not 
disposed of by the Chief, Fiscal activity, pursuant to paragraph (b) of 
this section.
    (C) Reject a compromise offer on a debt which exceeds $100,000, 
exclusive of interest and other late payment charges.
    (D) Recommend approval of a compromise offer on a debt which exceeds 
$100,000, exclusive of interest and other late payment charges. The 
authority to accept a compromise offer on such a debt rests solely 
within the jurisdiction of the Department of Justice. The Committee 
should evaluate a compromise offer on a debt in excess of $100,000, 
using the factors set forth in Sec. Sec. 1.930 through 1.938. If the 
Committee believes that the compromise offer is advantageous to the 
government, then the Committee members shall so state this conclusion in 
a written memorandum of recommendation of approval to the Chairperson. 
This recommendation, along with a Claims Collection Litigation Report 
(CCLR) completed in accordance with Sec. 1.951, will be referred to VA 
Central Office, Office of Financial Management (047G7), for submission 
to the Department of Justice for final approval.


(Authority: 31 U.S.C. 3711)

    (b) Chief of Fiscal activity. The Chief of the Fiscal activity at 
both VBA and VHA offices has the authority, as to debts within his/her 
jurisdiction, to:
    (1) On other than loan program debts under 38 U.S.C. chapter 37, 
accept compromise offers of 50% or more of a total debt not in excess of 
$1,000, exclusive of interest and other late payment charges, regardless 
of whether or not there has been a prior denial of waiver.
    (2) On other than loan program debts under 38 U.S.C. chapter 37, 
reject any offer of compromise of a total debt not in excess of $1,000, 
exclusive of interest and other late payment charges, regardless of 
whether or not there has been a prior denial of waiver.
    (3) On other than loan guaranty program debts under 38 U.S.C. 
chapter 37, reject any offer of compromise of a total debt not in excess 
of $1,000, exclusive of interest, regardless of whether or not there has 
been a prior denial of waiver.

(Authority: 31 U.S.C. 3711 and 38 U.S.C. 3720(a))

[44 FR 59906, Oct. 17, 1979, as amended at 51 FR 38803, Sept. 25, 1985; 
52 FR 42112, Nov. 3, 1987; 57 FR 47264, Oct. 15, 1992; 60 FR 53276, Oct. 
13, 1995; 69 FR 62201, Oct. 25, 2004]



Sec. 1.958  Finality of decisions.

    A decision by the regional office Committee, operating within the 
scope of its authority, denying waiver of all or part of a debt arising 
out of participation in a VA benefit or home loan program, is subject to 
appeal in accordance with 38 CFR parts 19 and 20. A denial of waiver of 
an erroneous payment of pay and allowances is subject to appeal in 
accordance with Sec. 1.963a(a). There is no right of appeal from a 
decision rejecting a compromise offer.

(Authority: 38 U.S.C. 501 and 7104).

[69 FR 62201, Oct. 25, 2004]



Sec. 1.959  Records and certificates.

    The Chairperson of the Committee shall execute or certify any 
documents pertaining to its proceedings. He/she will be responsible for 
maintaining needed records of the transactions of

[[Page 116]]

the Committee and preparation of any administrative or other reports 
which may be required.

(Authority: 38 U.S.C. 501)

[44 FR 59906, Oct. 17, 1979]



Sec. 1.960  Legal and technical assistance.

    Legal questions involving a determination under Sec. 2.6(e)(4) of 
this chapter will be referred to the Regional Counsel for action in 
accordance with delegations of the General Counsel, unless there is an 
existence a General Counsel's opinion or an approved Regional Counsel's 
opinion dispositive of the controlling legal principle. As to matters 
not controlled by Sec. 2.6(e)(4) of this chapter, the Chairperson of 
the regional office Committee or at his/her instance, a member, may seek 
and obtain advice from the Regional Counsel on legal matters within his/
her jurisdiction and from other division chiefs in their areas of 
responsibility, on any matter properly before the Committee. Guidance 
may also be requested from the Central Office staff.

(Authority: 38 U.S.C. 501)

[44 FR 59906, Oct. 17, 1979]



Sec. 1.961  Releases.

    On matters within its jurisdiction, the Committee may authorize the 
release of any right, title, claim, lien or demand, however acquired, 
against any person obligated on a loan guaranteed, insured, or made by 
the Department of Veterans Affairs under the provisions of 38 U.S.C. ch. 
37, or on an acquired loan, or on a vendee account.

[39 FR 26400, July 19, 1974]



Sec. 1.962  Waiver of overpayments.

    There shall be no collection of an overpayment, or any interest 
thereon, which results from participation in a benefit program 
administered under any law by VA when it is determined by a regional 
office Committee on Waivers and Compromises that collection would be 
against equity and good conscience. For the purpose of this regulation, 
the term overpayment refers only to those benefit payments made to a 
designated living payee or beneficiary in excess of the amount due or to 
which such payee or beneficiary is entitled. The death of an indebted 
payee, either prior to a request for waiver of the indebtedness or 
during Committee consideration of the waiver request, shall not preclude 
waiver consideration. There shall be no waiver consideration of an 
indebtedness that results from the receipt of a benefit payment by a 
non-payee who has no claim or entitlement to such payment.
    (a) Waiver consideration is applicable in an indebtedness resulting 
from work study and education loan default, as well as indebtedness of a 
veteran-borrower, veteran transferee, or indebted spouse of either, 
arising out of participation in the loan program administered under 38 
U.S.C. ch. 37. Also subject to waiver consideration is an indebtedness 
which is the result of VA hospitalization, domiciliary care, or 
treatment of a veteran, either furnished in error or on the basis of 
tentative eligibility.
    (b) In any case where there is an indication of fraud or 
misrepresentation of a material fact on the part of the debtor or any 
other party having an interest in the claim, action on a request for 
waiver will be deferred pending appropriate disposition of the matter. 
However, the existence of a prima facie case of fraud shall, 
nevertheless, entitle a claimant to an opportunity to make a rebuttal 
with countervailing evidence; similiarly, the misrepresentation must be 
more than non-willful or mere inadvertence. The Committee may act on a 
request for waiver concerning such debts, after the Inspector General or 
the Regional Counsel has determined that prosecution is not indicated, 
or the Department of Justice has notified VA that the alleged fraud or 
misrepresentation does not warrant action by that department, or the 
Department of Justice or the appropriate United States Attorney, 
specifically authorized action on the request for waiver.

(Authority: 38 U.S.C. 501)

[39 FR 26400, July 19, 1974, as amended at 44 FR 59906, Oct. 17, 1979; 
50 FR 38803, Sept. 25, 1985; 52 FR 42112, Nov. 3, 1987]



Sec. 1.963  Waiver; other than loan guaranty.

    (a) General. Recovery of overpayments of any benefits made under 
laws

[[Page 117]]

administered by the VA shall be waived if there is no indication of 
fraud, misrepresentation, or bad faith on the part of the person or 
persons having an interest in obtaining the waiver and recovery of the 
indebtedness from the payee who received such benefits would be against 
equity and good conscience.
    (b) Application. A request for waiver of an indebtedness under this 
section shall only be considered:
    (1) If made within 2 years following the date of a notice of 
indebtedness issued on or before March 31, 1983, by the Department of 
Veterans Affairs to the debtor, or
    (2) Except as otherwise provided herein, if made within 180 days 
following the date of a notice of indebtedness issued on or after April 
1, 1983, by the Department of Veterans Affairs to the debtor. The 180 
day period may be extended if the individual requesting waiver 
demonstrated to the Chairperson of the Committee on Waivers and 
Compromises that, as a result of an error by either the Department of 
Veterans Affairs or the postal authorities, or due to other 
circumstances beyond the debtor's control, there was a delay in such 
individual's receipt of the notification of indebtedness beyond the time 
customarily required for mailing (including forwarding). If the 
requester does substantiate that there was such a delay in the receipt 
of the notice of indebtedness, the Chairperson shall direct that the 180 
day period be computed from the date of the requester's actual receipt 
of the notice of indebtedness.

(Authority: 38 U.S.C. 5302 (a) & (c))

[39 FR 26400, July 19, 1974, as amended at 44 FR 59906, Oct. 17, 1979; 
48 FR 27400, June 15, 1983; 50 FR 38803, Sept. 25, 1985; 58 FR 3840, 
Jan. 12, 1993]



Sec. 1.963a  Waiver; erroneous payments of pay and allowances.

    (a) The provisions applicable to VA (including refunds) concerning 
waiver actions relating to erroneous payments to VA employees of pay and 
allowances, and travel, transportation, and relocation expenses and 
allowances, are set forth in 5 U.S.C. 5584. The members of Committees on 
Waivers and Compromises assigned to waiver actions under Sec. 1.955 of 
this part are delegated all authority granted the Secretary under 5 
U.S.C. 5584 to deny waiver or to grant waiver in whole or in part of any 
debt regardless of the amount of the indebtedness. Committee members 
also have exclusive authority to consider and render a decision on the 
appeal of a waiver denial or the granting of a partial waiver. However, 
the Chairperson of the Committee must assign the appeal to a different 
Committee member or members than the member or members who made the 
original decision that is now the subject of the appeal. The following 
are the only provisions of Sec. Sec. 1.955 through 1.970 of this part 
applicable to waiver actions concerning erroneous payments of pay and 
allowances, and travel, transportation, and relocation expenses and 
allowances, under 5 U.S.C. 5584: Sec. Sec. 1.955(a) through (e)(2), 
1.956(a)(introductory text) and (a)(3), 1.959, 1.960, 1.963a, and 
1.967(c).
    (b) Waiver may be granted under this section and 5 U.S.C. 5584 when 
collection would be against equity and good conscience and not in the 
best interest of the United States. Generally, these criteria will be 
met by a finding that the erroneous payment occurred through 
administrative error and that there is no indication of fraud, 
misrepresentation, fault, or lack of good faith on the part of the 
employee or other person having an interest in obtaining a waiver of the 
claim, and waiver would not otherwise be inequitable. Generally, waiver 
is precluded when an employee receives a significant unexplained 
increase in pay or allowances, or otherwise knows, or reasonably should 
know, that an erroneous payment has occurred, and fails to make 
inquiries or bring the matter to the attention of the appropriate 
officials. Waiver under this standard will depend upon the facts 
existing in each case.
    (c) An application for waiver must be received within 3 years 
immediately following the date on which the erroneous payment was 
discovered.

(Authority: 5 U.S.C. 5584; 38 U.S.C. 501)

[69 FR 62202, Oct. 25, 2004]

[[Page 118]]



Sec. 1.964  Waiver; loan guaranty.

    (a) General. Any indebtedness of a veteran or the indebtedness of 
the spouse shall be waived only when the following factors are 
determined to exist:
    (1) Following default there was a loss of the property which 
constituted security for the loan guaranteed, insured or made under 
chapter 37 of title 38 United States Code;
    (2) There is no indication of fraud, misrepresentation, or bad faith 
on the part of the person or persons having an interest in obtaining the 
waiver; and
    (3) Collection of such indebtedness would be against equity and good 
conscience.
    (b) Spouse. The waiver of a veteran's indebtedness shall inure to 
the spouse of such veteran insofar as concerns said indebtedness, unless 
the obligation of the spouse is specifically excepted. However, the 
waiver of the indebtedness of the veteran's spouse shall not inure to 
the benefit of the veteran unless specifically provided for in the 
waiver decision.
    (c) Surviving spouse or former spouse. A surviving spouse of a 
veteran or the former spouse of a veteran may be granted a waiver of the 
indebtedness provided the requirements of paragraph (a) of this section 
are met.
    (d) Preservation of Government rights. In cases in which it is 
determined that waiver may be granted, the action will take such form 
(covenant not to sue, or otherwise) as will preserve the rights of the 
Government against obligors other than the veteran or the spouse.
    (e) Application. A request for waiver of an indebtedness under this 
section shall be made within one year after the date on which the debtor 
receives, by Certified Mail-Return Receipt Requested, written notice 
from VA of the indebtedness. If written notice of indebtedness is sent 
by means other than Certified Mail-Return Receipt Requested, then there 
is no time limit for filing a request for waiver of indebtedness under 
this section.


(Authority: 38 U.S.C. 5302(b))

    (f) Exclusion. Except as otherwise provided in this section, the 
indebtedness of a nonveteran obligor under the loan program is excluded 
from waiver.

(Authority:
    38 U.S.C. 5302 (b) and (c))

[39 FR 26400, July 19, 1974, as amended at 44 FR 59907, Oct. 17, 1979; 
57 FR 33875, July 31, 1992; 58 FR 3840, Jan. 12, 1993]



Sec. 1.965  Application of standard.

    (a) The standard ``Equity and Good Conscience'', will be applied 
when the facts and circumstances in a particular case indicate a need 
for reasonableness and moderation in the exercise of the Government's 
rights. The decision reached should not be unduly favorable or adverse 
to either side. The phrase equity and good conscience means arriving at 
a fair decision between the obligor and the Government. In making this 
determination, consideration will be given to the following elements, 
which are not intended to be all inclusive:
    (1) Fault of debtor. Where actions of the debtor contribute to 
creation of the debt.
    (2) Balancing of faults. Weighing fault of debtor against Department 
of Veterans Affairs fault.
    (3) Undue hardship. Whether collection would deprive debtor or 
family of basic necessities.
    (4) Defeat the purpose. Whether withholding of benefits or recovery 
would nullify the objective for which benefits were intended.
    (5) Unjust enrichment. Failure to make restitution would result in 
unfair gain to the debtor.
    (6) Changing position to one's detriment. Reliance on Department of 
Veterans Affairs benefits results in relinquishment of a valuable right 
or incurrence of a legal obligation.
    (b) In applying this single standard for all areas of indebtedness, 
the following elements will be considered, any indication of which, if 
found, will preclude the granting of waiver:
    (1) Fraud or misrepresentation of a material fact (see Sec. 
1.962(b)).
    (2) Bad faith. This term generally describes unfair or deceptive 
dealing by one who seeks to gain thereby at another's expense. Thus, a 
debtor's conduct in connection with a debt arising from participation in 
a VA benefits/services program exhibits bad faith if

[[Page 119]]

such conduct, although not undertaken with actual fraudulent intent, is 
undertaken with intent to seek an unfair advantage, with knowledge of 
the likely consequences, and results in a loss to the government.

(Authority: 38 U.S.C. 5302(c))

[39 FR 26400, July 19, 1974, as amended at 58 FR 3841, Jan. 12, 1993; 58 
FR 7296, Feb. 5, 1993; 69 FR 62202, Oct. 25, 2004]



Sec. 1.966  Scope of waiver decisions.

    (a) Decisions will be based on the evidence of record. A hearing may 
be held at the request of the claimant or his/her representative. No 
expenses incurred by a claimant, his representative, or any witness 
incident to a hearing will be paid by the Department of Veterans 
Affairs.
    (b) A regional office Committee may:
    (1) Waive recovery as to certain persons and decline to waive as to 
other persons whose claims are based on the same veteran's service.
    (2) Waive or decline to waive recovery from specific benefits or 
sources, except that:
    (i) There shall be no waiver of recovery out of insurance of an 
indebtedness secured thereby; i.e., an insurance overpayment to an 
insured. However, recovery may be waived of any or all of such 
indebtedness out of benefits other than insurance then or thereafter 
payable to the insured.

(Authority: 38 U.S.C. 501, 5302)

[39 FR 26400, July 19, 1974, as amended at 44 FR 59907, Oct. 17, 1979; 
48 FR 1056, Jan. 10, 1983; 69 FR 62202, Oct. 25, 2004]



Sec. 1.967  Refunds.

    (a) Except as provided in paragraph (c) of this section, any portion 
of an indebtedness resulting from participation in benefits programs 
administered by the Department of Veterans Affairs which has been 
recovered by the U.S. Government from the debtor may be considered for 
waiver, provided the debtor requests waiver in accordance with the time 
limits of Sec. 1.963(b). If collection of an indebtness is waived as to 
the debtor, such portions of the indebtedness previously collected by 
the Department of Veterans Affairs will be refunded. In the event that 
waiver of collection is granted for either an education, loan guaranty, 
or direct loan debt, there will be a reduction in the debtor's 
entitlement to future benefits in the program in which the debt 
originated.
    (b) The Department of Veterans Affairs may not waive collection of 
the indebtedness of an educational institution found liable under 38 
U.S.C. 3685. Waiver of collection of educational benefit overpayments 
from all or a portion of the eligible persons attending an educational 
institution which has been found liable under 38 U.S.C. 3685 shall not 
relieve the institution of its assessed liability. (See 38 CFR 
21.4009(f)).
    (c) The regulatory provisions concerning refunds of indebtedness 
collected by the Department of Veterans Affairs arising from erroneous 
payments of pay and allowances and travel, transportation, and 
relocation expenses and allowances are set forth in 4 CFR Parts 91 and 
92.
    (d) Refund of the entire amount collected may not be made when only 
a part of the debt is waived or when collection of the balance of a loan 
guaranty indebtedness by the Department of Veterans Affairs from 
obligors, other than a husband or wife of the person requesting waiver, 
will be adversely affected. Only where the amount collected exceeds the 
balance of the indebtedness still in existence will a refund be made in 
the amount of the difference between the two. Otherwise, refunds will be 
made in accordance with paragraph (a) of this section.

(Authority: 38 U.S.C. 3685, 5302; 5 U.S.C. 5584)

[48 FR 1056, Jan. 10, 1983, as amended at 60 FR 53276, Oct. 13, 1995]



Sec. 1.968  [Reserved]



Sec. 1.969  Revision of waiver decisions.

    (a) Jurisdiction. A decision involving waiver may be reversed or 
modified on the basis of new and material evidence, fraud, a change in 
law or interpretation of law specifically stated in a Department of 
Veterans Affairs issue, or clear and unmistakable error shown by the 
evidence in file at the time the prior decision was rendered by the same 
or any other regional office Committee.

[[Page 120]]

    (b) Finality of decisions. Except as provided in paragraph (a) of 
this section, a decision involving waiver rendered by the Committee 
having jurisdiction is final, subject to the provisions of:
    (1) Sections 3.104(a), 19.153 and 19.154 of this chapter as to 
finality of decisions;
    (2) Section 3.105 (a) and (b) of this chapter as to revision of 
decisions, except that the Central Office staff may postaudit or make an 
administrative review of any decision of a regional office Committee;
    (3) Sections 3.103, 19.113 and 19.114 of this chapter as to notice 
of disagreement and the right of appeal;
    (4) Section 19.124 of this chapter as to the filing of 
administrative appeals and the time limits for filing such appeals.
    (c) Difference of opinion. Where reversal or amendment of a decision 
involving waiver is authorized under Sec. 3.105(b) of this chapter 
because of a difference of opinion, the effective date of waiver will be 
governed by the principle contained in Sec. 3.400(h) of this chapter.

(Authority: 38 U.S.C. 501)

[44 FR 59907, Oct. 17, 1979]



Sec. 1.970  Standards for compromise.

    Decisions of the Committee respecting acceptance or rejection of a 
compromise offer shall be in conformity with the standards in Sec. Sec. 
1.930 through 1.936. In loan guaranty cases the offer of a veteran or 
other obligor to effect a compromise must relate to an indebtedness 
established after the liquidation of the security, if any, and shall be 
reviewed by the Committee. An offer to effect a compromise may be 
accepted if it is deemed advantageous to the Government. A decision on 
an offer of compromise may be revised or modified on the basis of any 
information which would warrant a change in the original decision.

(Authority: 31 U.S.C. 3711; 38 U.S.C. 501, 3720)

[44 FR 59907, Oct. 17, 1979, as amended at 69 FR 62202, Oct. 25, 2004]

                        Salary Offset Provisions

    Source: 52 FR 1905, Jan. 16, 1987, unless otherwise noted.



Sec. 1.980  Scope.

    (a) In accordance with 5 CFR part 550, subpart K, the provisions set 
forth in Sec. Sec. 1.980 through 1.995 implement VA's authority for the 
use of salary offset to satisfy certain debts owed to VA.
    (b) These regulations apply to offsets from the salaries of current 
employees of VA, or any other agency, who owe debts to VA. Offsets by VA 
from salaries of current VA employees who owe debts to other agencies 
shall be processed in accordance with procedures set forth in 5 CFR part 
550, subpart K.
    (c) These regulations do not apply to debts or claims arising under 
the Internal Revenue Code of 1954, as amended, the Social Security Act, 
the tariff laws of the United States, or to any case where collection of 
a debt by salary offset is explicitly provided for (e.g., travel 
advances in 5 U.S.C. 5705 and employee training expenses in 5 U.S.C. 
4108) or prohibited by another statute.
    (d) These regulations do not preclude an employee from requesting 
waiver of an overpayment under 38 U.S.C. 5302, 5 U.S.C. 5584, or any 
other similar provision of law, or in any way questioning the amount or 
validity of a debt not involving benefits under the laws administered by 
VA by submitting a subsequent claim to the General Accounting Office in 
accordance with procedures prescribed by that office.
    (e) These regulations do not apply to any adjustment to pay arising 
out of an employee's election of coverage or a change in coverage under 
a Federal benefits program requiring periodic deductions from pay if the 
amount to be recovered was accumulated over four pay periods or less.
    (f) These regulations do not apply to a routine intra-agency 
adjustment of pay that is made to correct an overpayment of pay 
attributable to clerical or administrative errors or delays in 
processing pay documents, if the overpayment occurred within the four 
pay periods preceding the adjustment and, at the time of such 
adjustment, or as soon thereafter as practicable, the individual is 
provided written notice of the nature and amount of the adjustment and a 
point of contact for contesting such adjustment.
    (g) These regulations do not apply to any adjustment to collect a 
debt

[[Page 121]]

amounting to $50 or less, if at the time of such adjustment, or as soon 
thereafter as practicable, the individual is provided with written 
notice of the nature and amount of the adjustment and a point of contact 
for contesting such adjustment.
    (h) These regulations do not preclude the compromise, suspension, or 
termination of collection action under the Federal Claims Collection 
Standards (FCCS) (31 CFR parts 900-904) and VA regulations 38 CFR 1.930 
through 1.944.
    (i) The procedures and requirements of these regulations do not 
apply to salary offset used to recoup a Federal employee's debt where a 
judgment has been obtained against the employee for the debt.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987; 52 FR 23824, June 25, 1987, as amended at 54 
FR 34980, Aug. 23, 1989; 69 FR 62202, Oct. 25, 2004]



Sec. 1.981  Definitions.

    (a) Agency means:
    (1) An executive agency as defined in 5 U.S.C. 105, including the 
U.S. Postal Service, and the U.S. Postal Rate Commission, and
    (2) A military department as defined in 5 U.S.C. 102.
    (3) An agency or court of the judicial branch, including a court as 
defined in 28 U.S.C. 610, the District Court for the Northern Mariana 
Islands, and the Judicial Panel on Multidistrict Litigation;
    (4) An agency of the legislative branch, including the U.S. Senate 
and the U.S. House of Representatives; and
    (5) Other independent establishments that are entities of the 
Federal Government.
    (b) Debt means an amount owed to the United States from sources 
which include loans insured or guaranteed by the United States and all 
other amounts due the United States from fees, leases, rents, royalties, 
services, sales of real or personal property, overpayments, penalties, 
damages, interest, fines and forfeitures (except those arising under the 
Uniform Code of Military Justice), and all other similar sources.
    (c) Disposable pay means that part of current basic pay, special 
pay, incentive pay, retired pay, retainer pay, or in the case of an 
employee not entitled to basic pay, other authorized pay remaining after 
the deduction of any amount required by law to be withheld. Excluded 
from this definition are deductions described in 5 CFR 581.105(b) 
through (f).
    (d) Employee means a current employee of VA or other Federal agency 
including a current member of the Armed Forces or a Reserve of the Armed 
Forces (Reserves).
    (e) Salary offset means an attempt to collect a debt under 5 U.S.C. 
5514 by deduction(s) at one or more officially estabilished pay 
intervals from the current pay account of an employee without his or her 
consent.
    (f) Waiver means the cancellation, remission, forgiveness, or non-
recovery of a debt owed by an employee to VA or another Federal agency 
as permitted or required by 5 U.S.C. 5584 or 38 U.S.C. 5302, or other 
similar statutes.
    (g) Extreme hardship to an employee means an employee's inability to 
provide himself or herself and his or her dependents with the 
necessities of life such as food, housing, clothing, transportation, and 
medical care.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987; 52 FR 23824, June 25, 1987]



Sec. 1.982  Salary offsets of debts involving benefits under the laws administered by VA.

    (a) VA will not collect a debt involving benefits under the laws 
administered by VA by salary offset unless the Secretary or appropriate 
designee first provides the employee with a minimum of 30 calendar days 
written notice.
    (b) If the employee has not previously appealed the amount or 
existence of the debt under 38 CFR parts 19 and 20 and the time for 
pursuing such an appeal has not expired (Sec. 20.302), the Secretary or 
appropriate designee will provide the employee with written notice of 
the debt. The written notice will state that the employee may appeal the 
amount and existence of the debt in accordance with the procedures set 
forth in 38 CFR parts 19 and 20 and will contain the determination and 
information required by Sec. 1.983(b)(1) through (5), (7), (9), (10), 
and (12) though (14). The notice will also state that the employee may 
request a hearing on the

[[Page 122]]

offset schedule under the procedures set forth in Sec. 1.984 and such a 
request will stay the commencement of salary offset.
    (c) If the employee previously appealed the amount or existence of 
the debt and the Board of Veterans Appeals decided the appeal on the 
merits or if the employee failed to pursue an appeal within the time 
provided by regulations, the Secretary or designee shall provide the 
employee with written notice prior to collecting the debt by salary 
offset. The notice will state:
    (1) The determinations and information required by Sec. 
1.983(b)(1)-(5), (7), and (12)-(14);
    (2) That the employee's appeal of the existence or amount of the 
debt was determined on the merits or that the employee failed to pursue 
an appeal within the time provided, and VA's decision is final except as 
otherwise provided in agency regulations;
    (3) That the employee may request a waiver of the debt pursuant to 
38 CFR 1.911(c)(2) subject to the time limits of 38 U.S.C. 5302.
    (4) That the employee may request an oral or paper hearing on the 
offset schedule and receive a decision within 60 days of such request 
under the procedures and time limit set forth in Sec. 1.984 and that 
such a request will stay the commencement of salary offset.
    (d) If the employee has appealed the existence or amount of the debt 
and the Board of Veterans Appeals has not decided the appeal on the 
merits, collection of the debt by salary offset will be suspended until 
the appeal is decided or the employee ceases to pursue the appeal.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62202, Oct. 25, 2004]



Sec. 1.983  Notice requirements before salary offsets of debts not involving benefits under the laws administered by VA.

    (a) For a debt not involving benefits under the laws administered by 
VA, the Secretary or designee will review the records relating to the 
debt to assure that it is owed prior to providing the employee with a 
notice of the debt.
    (b) Except as provided in Sec. 1.980(e), salary offset of debts not 
involving benefits under the laws administered by VA will not be made 
unless the Secretary or designee first provides the employee with a 
minimum of 30 calendar days written notice. This notice will state:
    (1) The Secretary or designee's determination that a debt is owed;
    (2) The amount of the debt owed and the facts giving rise to the 
debt;
    (3) The Secretary or designee's intention to collect the debt by 
means of deduction from the employee's current disposable pay account 
until the debt and all accumulated interest and associated costs are 
paid in full;
    (4) The amount, frequency, approximate beginning date, and duration 
of the intended deductions;
    (5) An explanation of VA's requirements concerning interest, 
administrative costs, and penalties;
    (6) The employee's right to inspect and copy VA records relating to 
the debt or, if the employee or his or her representative cannot 
personally inspect the records, to request and receive a copy of such 
records;
    (7) The employee's right to enter into a written agreement with the 
Secretary or designee for a repayment schedule differing from that 
proposed by the Secretary or designee, so long as the terms of the 
repayment schedule proposed by the employee are agreeable to the 
Secretary or designee;
    (8) The VA employee's right to request an oral or paper hearing on 
the Secretary or appropriate designee's determination of the existence 
or amount of the debt, or the percentage of disposable pay to be 
deducted each pay period, so long as a request is filed by the employee 
as prescribed by the Secretary. The hearing official for the hearing 
requested by a VA employee must be either a VA administrative law judge 
or a hearing official from an agency other than VA. Any VA hearing 
official may conduct an oral or paper hearing at the request of a non-VA 
employee on the determination by an appropriately designated official of 
the employing agency of the existence or amount of the debt, or the 
percentage of disposable pay to be deducted each pay period, so long as 
a hearing request is filed by the non-VA employee as prescribed by the 
employing agency.

[[Page 123]]

    (9) The method and time period for requesting a hearing;
    (10) That the timely filing of a request for a hearing (oral or 
paper) will stay the commencement of salary offset;
    (11) That a final decision after the hearing will be issued at the 
earliest practical date, but no later than 60 calendar days after the 
filing of the request for the hearing, unless the employee requests and 
the hearing officer grants a delay in the proceedings;
    (12) That any knowingly false or frivolous statements, 
representations, or evidence may subject the employee to:
    (i) Disciplinary procedures appropriate under 5 U.S.C. ch. 75, 5 CFR 
part 752, or any other applicable statutes or regulations;
    (ii) Penalties under the False Claims Act, 31 U.S.C. 3729-3731, or 
any other applicable statutory authority; or
    (iii) Criminal penalties under 18 U.S.C. 286, 287, 1001, and 1002 or 
any other applicable statutory authority.
    (13) The employee's right, if applicable, to request waiver under 5 
U.S.C. 5584 and 38 CFR 1.963a and any other rights and remedies 
available to the employee under statutes or regulations governing the 
program for which the collection is being made; and
    (14) Unless there are applicable contractual or statutory provisions 
to the contrary, that amounts paid on or deducted for the debt which are 
later waived or found not owed to the United States will be promptly 
refunded to the employee.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62202, Oct. 25, 2004; 72 
FR 65462, Nov. 21, 2007]



Sec. 1.984  Request for a hearing.

    (a) Except as provided in paragraph (b) of this section and in Sec. 
1.982, an employee wishing a hearing on the existence or amount of the 
debt or on the proposed offset schedule must send such a request to the 
office which sent the notice of the debt. The employee must also specify 
whether an oral or paper hearing is requested. If an oral hearing is 
requested, the request should explain why the matter cannot be resolved 
by review of the documentary evidence. The request must be received by 
the office which sent the notice of the debt not later than 30 calendar 
days from the date of the notice.
    (b) If the employee files a request for a hearing after the 
expiration of the 30 day period provided for in paragraph (a) of this 
section, VA may accept the request if the employee shows that the delay 
was because of circumstances beyond his or her control or because of 
failure to receive the written notice of the filing deadline (unless the 
employee has actual notice of the filing deadline).

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62203, Oct. 25, 2004]



Sec. 1.985  Form, notice of, and conduct of hearing.

    (a) After an employee requests a hearing, the hearing official or 
administrative law judge shall notify the employee of the form of the 
hearing to be provided. If the hearing will be oral, the notice shall 
set forth the date, time, and location for the hearing. If the hearing 
will be paper, the employee shall be notified that he or she should 
submit his or her position and arguments in writing to the hearing 
official or administrative law judge by a specified date after which the 
record shall be closed. This date shall give the employee reasonable 
time to submit this information.
    (b) An employee who requests an oral hearing shall be provided an 
oral hearing if the hearing official or administrative law judge 
determines that the matter cannot be resolved by review of documentary 
evidence, for example, when an issue of credibility or veracity is 
involved. If a determination is made to provide an oral hearing, the 
hearing official or administrative law judge may offer the employee the 
opportunity for a hearing by telephone conference call. If this offer is 
rejected or if the hearing official or administrative law judge declines 
to offer a telephone conference call hearing, the employee shall be 
provided an oral hearing permitting the personal appearance of the 
employee, his or her personal representative, and witnesses. A record or 
transcript of every oral hearing shall be made. Witnesses shall testify 
under

[[Page 124]]

oath or affirmation. VA shall not be responsible for the payment of any 
expenses incident to attendance at the hearing which are incurred by 
either the employee, his or her representative or Counsel, or witnesses.
    (c) In all other cases where an employee requests a hearing, a paper 
hearing shall be provided. A paper hearing shall consist of a review of 
the written evidence of record by the administrative law judge or 
hearing official.
    (d) In any hearing under this section, the administrative law judge 
or hearing official may exclude from consideration evidence or testimony 
which is irrelevant, immaterial, or unduly repetitious.

(Authority: 5 U.S.C. 5514)



Sec. 1.986  Result if employee fails to meet deadlines.

    An employee waives the right to a hearing, and will have his or her 
disposable pay offset in accordance with the offset schedule, if the 
employee:
    (a) Fails to file a request for a hearing as prescribed in Sec. 
1.982, Sec. 1.984, or Sec. Sec. 19.1 through 19.200, whichever is 
applicable, unless such failure is excused as provided in Sec. 
1.984(b); or
    (b) Fails to appear at an oral hearing of which he or she had been 
notified unless the administrative law judge or hearing official 
determines that failure to appear was due to circumstances beyond the 
employee's control.

(Authority: 5 U.S.C. 5514)



Sec. 1.987  Review by the hearing official or administrative law judge.

    (a) The hearing official or administrative law judge shall uphold 
VA's determination of the existence and amount of the debt unless 
determined to be erroneous by a preponderance of the evidence.
    (b) The hearing official or administrative law judge shall uphold 
VA's offset schedule unless the schedule would result in extreme 
hardship to the employee.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987; 52 FR 23824, June 25, 1987]



Sec. 1.988  Written decision following a hearing requested under Sec. 1.984.

    (a) The hearing official or administrative law judge must issue a 
written decision not later than 60 days after the employee files a 
request for the hearing.
    (b) Written decisions provided after a hearing requested under Sec. 
1.984 will include:
    (1) A statement of the facts presented to support the nature and 
origin of the alleged debt;
    (2) The hearing official or administrative law judge's analysis, 
findings and conclusions concerning as applicable:
    (i) The employee's or VA's grounds;
    (ii) The amount and validity of the alleged debt; and
    (iii) The repayment schedule.
    (c) The decision in a case where a paper hearing was provided shall 
be based upon a review of the written record. The decision in a case 
where an oral hearing was provided shall be based upon the hearing and 
the written record.

(Authority: 5 U.S.C. 5514)



Sec. 1.989  Review of VA records related to the debt.

    (a) Notification by employee. An employee who intends to inspect or 
copy VA records related to the debt as permitted by a notice provided 
under Sec. 1.983 must send a letter to the office which sent the notice 
of the debt stating his or her intention. The letter must be received by 
that office within 30 calendar days of the date of the notice.
    (b) VA response. In response to timely notice submitted by the 
debtor as described in paragraph (a) of this section, VA will notify the 
employee of the location and time when the employee may inspect and copy 
records related to the debt.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62203, Oct. 25, 2004]



Sec. 1.990  Written agreement to repay debt as alternative to salary offset.

    (a) Notification by employee. The employee may propose, in response 
to a

[[Page 125]]

notice under Sec. 1.983, a written agreement to repay the debt as an 
alternative to salary offset. Any employee who wishes to do this must 
submit a proposed written agreement to repay the debt which is received 
by the office which sent the notice of the debt within 30 calendar days 
of the date of the notice.
    (b) VA response. In response to timely notice by the debtor as 
described in paragraph (a) of this section, VA will notify the employee 
whether the employee's proposed written agreement for repayment is 
acceptable. It is within VA's discretion to accept a repayment agreement 
instead of proceeding by offset. In making this determination, VA will 
balance its interest in collecting the debt against the hardship to the 
employee. VA will accept a repayment agreement instead of offset only if 
the employee is able to establish that offset would result in extreme 
hardship.

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62203, Oct. 25, 2004]



Sec. 1.991  Procedures for salary offset: when deductions may begin.

    (a) Deductions to liquidate an employee's debt will be by the method 
and in the amount stated in the notice to collect from the employee's 
current pay as modified by a written decision issued under Sec. 1.982 
or Sec. 1.988, or parts 19 and 20 or by written agreement between the 
employee and the VA under Sec. 1.990.
    (b) If the employee filed a request for a hearing as provided by 
Sec. 1.984 before the expiration of the period provided for in that 
section, deductions will not begin until after the hearing official or 
administrative law judge has provided the employee with a hearing, and 
has rendered a final written decision.
    (c) If the employee failed to file a timely request for a hearing, 
deductions will begin on the date specified in the notice of intention 
to offset, unless a hearing is granted pursuant to Sec. 1.984(b).
    (d) If an employee retires, resigns, or his or her employment ends 
before collection of the amount of the indebtedness is completed, the 
remaining indebtedness will be collected according to procedures for 
administrative offset (see 5 CFR 831.1801 through 831.1808, 31 CFR 
901.3, and 38 CFR 1.912).

(Authority: 5 U.S.C. 5514)

[52 FR 1905, Jan. 16, 1987, as amended at 69 FR 62203, Oct. 25, 2004]



Sec. 1.992  Procedures for salary offset.

    (a) Types of collection. A debt will be collected in a lump-sum or 
in installments. Collection will be in a lump-sum unless the employee is 
financially unable to pay in one lump-sum, or if the amount of the debt 
exceeds 15 percent of the employee's disposable pay. In these cases, 
deduction will be by installments.
    (b) Installment deductions. (1) A debt to be collected in 
installments will be deducted at officially established pay intervals 
from an employee's current pay account unless the employee and the 
Secretary agree to alternative arrangements for repayment. The 
alternative arrangement must be in writing and signed by both the 
employee and Secretary or designee.
    (2) Installment deductions will be made over a period not greater 
than the anticipated period of employment. The size and frequency of 
installment deductions will bear a reasonable relation to the size of 
the debt and the employee's ability to pay. However, the amount deducted 
for any period will not exceed 15 percent of the disposable pay from 
which the deduction is made, unless the employee has agreed in writing 
to the deduction of a greater amount. If possible, the installment 
payment will be sufficient in size and frequency to liquidate the debt 
in three years. Installment payments of less than $25 per pay period or 
$50 a month will be acceptable only in the most unusual circumstances.
    (c) Imposition of interest, penalties, and administrative costs. 
Interest, penalties, and administrative costs shall be charged in 
accordance with 31 CFR 901.9 and 38 CFR 1.915.

(Authority: 5 U.S.C. 5514; 38 U.S.C. 501)

[52 FR 1905, Jan. 16, 1987, as amended at 54 FR 34980, Aug. 23, 1989; 69 
FR 62203, Oct. 25, 2004]

[[Page 126]]



Sec. 1.993  Non-waiver of rights.

    So long as there are not statutory or contractual provisions to the 
contrary, an employee's involuntary payment (of all or a portion of a 
debt) under these regulations will not be interpreted as a waiver of any 
rights that the employee may have under 5 U.S.C. 5514.

(Authority: 5 U.S.C. 5514)
    VA will refund promptly to the appropriate individual amounts offset 
under these regulations when:
    (a) A debt is waived or otherwise found not owed the United States 
(unless expressly prohibited by statute or regulation); or
    (b) VA is directed by an administrative or judicial order to refund 
amounts deducted from the employee's current pay.

(Authority: 5 U.S.C. 5514)



Sec. 1.995  Requesting recovery through centralized administrative offset.

    (a) Under 31 U.S.C. 3716, VA and other creditor agencies must notify 
Treasury of all debts over 180 days delinquent so that recovery of such 
debts may be made by centralized administrative offset. This includes 
those debts that VA and other agencies seek from the pay account of an 
employee of another Federal agency via salary offset. Treasury and other 
disbursing officials will match payments, including Federal salary 
payments, against these debts. Where a match occurs, and all the 
requirements for offset have been met, the payment will be offset to 
satisfy the debt in whole or part.
    (b) Prior to submitting a debt to Treasury for the purpose of 
collection by offset, including salary offset, VA shall provide written 
certification to Treasury that:
    (1) The debt is past due and legally enforceable in the amount 
submitted to Treasury and that VA will ensure that any subsequent 
collections are credited to the debt and that Treasury shall be notified 
of such;
    (2) Except in the case of a judgment debt or as otherwise allowed by 
law, the debt is referred to Treasury for offset within 10 years after 
VA's right of action accrues;
    (3) VA has complied with the provisions of 31 U.S.C. 3716 and 38 CFR 
1.912 and 1.912a including, but not limited to, those provisions 
requiring that VA provide the debtor with applicable notices and 
opportunities for a review of the debt; and
    (4) VA has complied with the provisions of 5 U.S.C. 5514 (salary 
offset) and 38 CFR 1.980 through 1.994 including, but not limited to, 
those provisions requiring that VA provide the debtor with applicable 
notices and opportunities for a hearing.
    (c) Specific procedures for notifying Treasury of debts for purposes 
of collection by centralized administrative offset are contained in the 
31 CFR 285.7. VA and other creditor agencies may notify Treasury of 
debts that have been delinquent for 180 days or less, including debts 
that VA and other creditor agencies seek to recover from the pay of an 
employee via salary offset.

(Authority: 31 U.S.C. 3716; 38 U.S.C. 501)

[69 FR 62203, Oct. 25, 2004]



PART 2_DELEGATIONS OF AUTHORITY--Table of Contents




Sec.
2.1 General provisions.
2.2 Delegation of authority to employees to issue subpoenas, etc.
2.3 Delegation of authority to employees to take affidavits, to 
          administer oaths, etc.
2.4 Delegation of authority to order paid advertising for use in 
          recruitment.
2.5 Delegation of authority to certify copies of documents, records, or 
          papers in Department of Veterans Affairs files.
2.6 Secretary's delegations of authority to certain officials (38 U.S.C. 
          512).
2.7 Delegation of authority to provide relief on account of 
          administrative error.
2.8 Delegation of authority to authorize allowances for Department of 
          Veterans Affairs employees who are notaries public.

    Authority: 5 U.S.C. 302, 552a; 38 U.S.C. 501, 512, 515, 1729, 1729A, 
5711; 44 U.S.C. 3702, and as noted in specific sections.

    Editorial Note: Nomenclature changes to part 2 appear at 61 FR 7216, 
Feb. 27, 1996.



Sec. 2.1  General provisions.

    In addition to the delegations of authority in this part, numerous 
delegations of authority are set forth throughout this title.

(Authority: 38 U.S.C. 512)

[64 FR 47111, Aug. 30, 1999]

[[Page 127]]



Sec. 2.2  Delegation of authority to employees to issue subpoenas, etc.

    (a) Authority to issue subpoenas. Employees occupying or acting in 
the positions designated in paragraph (b) of this section shall have the 
power to issue subpoenas for (by countersigning VA Form 2-4003) and 
compel the attendance of witnesses within a radius of 100 miles from the 
place of hearing and to require the production of books, papers, 
documents, and other evidence. Issuing officials shall use discretion 
when exercising this power.
    (b) Designated positions. The positions designated pursuant to 
paragraph (a) of this section are: General Counsel, Deputy General 
Counsel, Chairman, Board of Veterans' Appeals, Heads of Regional Offices 
and Centers having insurance or regional office activities, Under 
Secretary for Health (for income matching programs), Director, Income 
Verification Match Center (for income matching programs), and the 
Associate Director for Operations, Income Verification Match Center (for 
income matching programs).
    (c) Means of service. Subpoenas issued pursuant to this section may 
be served by registered or certified mail, return receipt requested, 
addressed to the witness only. Personal service by any VA employee or 
other authorized person may be made where authorized in writing by the 
issuing official.
    (d) Fees and mileage; district courts of the United States. Any 
person required by such subpoena to attend as a witness shall be allowed 
and paid the same fees and mileage as are paid witnesses in the district 
courts of the United States. In case of disobedience to any such 
subpoena, the aid of any district court of the United States may be 
invoked in requiring attendance and testimony of witnesses and the 
production of documentary evidence, and such court within the 
jurisdiction in which the inquiry is carried on may, in the case of 
contumacy or refusal to obey a subpoena issued to any officer, agent, or 
employee of any corporation or to any other person, issue an order 
requiring such corporation or other person to appear or to give evidence 
touching the matter in question, and any failure to obey such order of 
the court may be punished by such court as a contempt thereof.

(Authority: 38 U.S.C.A. 501, 5711)

[60 FR 40757, Aug. 10, 1995. Redesignated at 64 FR 47111, Aug. 30, 1999]



Sec. 2.3  Delegation of authority to employees to take affidavits, to administer oaths, etc.

    (a) An employee to whom authority is delegated by the Secretary in 
accordance with 38 U.S.C. 5711, or to whom authority was delegated by 
the Secretary in accordance with title III, Pub. L. 844, 74th Congress, 
section 616, Pub. L. 801, 76th Congress, and section 1211, Pub. L. 85-
56, is by virtue of such delegated authority, until such authority is 
revoked or otherwise terminated, empowered to take affidavits, to 
administer oaths and affirmations, to aid claimants in the preparation 
and presentation of claims, and to make investigations, examine 
witnesses, and certify to the correctness of papers and documents upon 
any matter within the jurisdiction of the Department of Veterans 
Affairs. Such employee is not authorized to administer oaths in 
connection with the execution of affidavits relative to fiscal vouchers 
and is not authorized to take acknowledgments to policy loan agreements 
and applications for cash surrender value to United States Government 
life insurance and National Service life insurance.
    (b) Any such oath, affirmation, affidavit, or examination, when 
certified under the hand of any such employee by whom it was 
administered or taken and authenticated by the seal of the Department of 
Veterans Affairs, may be offered or used in any court of the United 
States and, without further proof of the identity or authority of such 
employee, shall have like force and effect as if administered or taken 
before a clerk of such court.
    (c) The delegated authority from the Secretary to employees to take 
affidavits, to administer oaths, etc., will be evidenced by VA Form 4505 
series.

[24 FR 10018, Dec. 11, 1959. Redesignated at 64 FR 47111, Aug. 30, 1999]

[[Page 128]]



Sec. 2.4  Delegation of authority to order paid advertising for use in recruitment.

    Paid advertisements may be used in recruitment for VA competitive 
and excepted service positions. Authority to order such advertisements 
is hereby delegated to Administration Heads, Assistant Secretaries, 
Other Key Officials (the General Counsel; the Inspector General; the 
Chairman, Board of Veterans' Appeals; and the Director, Office of Small 
and Disadvantaged Business Utilization), Deputy Assistant Secretaries, 
to the deputies of such officials, to the Deputy Assistant Secretary and 
Associate Deputy Assistant Secretary for Human Resources Management, and 
to field facility Directors.

(Authority: 5 U.S.C. 302(b)(2); 44 U.S.C. 3702)

[61 FR 20134, May 6, 1996, as amended at 72 FR 65462, Nov. 21, 2007]



Sec. 2.5  Delegation of authority to certify copies of documents, records, or papers in Department of Veterans Affairs files.

    (a) Persons occupying or acting for the following positions in the 
Office of the General Counsel are authorized to certify copies of public 
documents, records, or papers belonging to or in the files of the 
Department of Veterans Affairs for the purposes of 38 U.S.C. 302: 
General Counsel, Deputy General Counsel, Assistant General Counsel, 
Deputy Assistant General Counsel, and the Regional Counsel for Puerto 
Rico.
    (b) The person occupying or acting in the position of Chairman, 
Board of Veterans Apeals, is authorized to certify copies of decisions, 
orders, subpoenas, and other documents, records, or papers issued by, 
belonging to, or in the files of the Board for the purposes of 38 U.S.C. 
302.

(Authority: 38 U.S.C. 302, 501, 512)

[46 FR 18978, Mar. 27, 1981, as amended at 49 FR 30692, Aug. 1, 1984; 60 
FR 48029, Sept. 18, 1995; 72 FR 65462, Nov. 21, 2007]



Sec. 2.6  Secretary's delegations of authority to certain officials (38 U.S.C. 512).

    Employees occupying or acting in the positions designated below are 
delegated authority as indicated:
    (a) Veterans Health Administration. The Under Secretary for Health 
is delegated authority:
    (1) To act on all matters assigned to the Veterans Health 
Administration by statute (38 U.S.C. Ch. 73) and by regulation, except 
such matters as require the personal attention or action of the 
Secretary.
    (2) To revise, exceed, delete, increase, or decrease fees contained 
in Department of Veterans Affairs Veterans Health Services and Research 
Administration Manual M-1, part I, appendix A (following agreement 
therefor as provided in the contract with the intermediary involved), in 
an approved State fee schedule, and to add additional fees when found to 
be necessary, provided such fees are not in excess of those customarily 
charged the general public, in the community concerned, for the same 
service.
    (3) To designate the Deputy Under Secretary for Health, or other 
physician of the Veterans Health Administration, and authority is hereby 
delegated such designee to perform the functions prescribed in paragraph 
(a)(2) of this section.
    (4) To revise, exceed, delete, increase or decrease dental fees 
established in Department of Veterans Affairs Veterans Health Services 
and Research Administration Manual M-4, chapter 6, and any amendments 
thereto, and to add additional fees when found to be necessary, 
provided: such fees are not in excess of those customarily charged the 
general public, in the community concerned, for the same service.
    (5) To designate the Assistant Chief Medical Director for Dentistry, 
and authority is hereby delegated such designee, to perform the 
functions prescribed in paragraph (a)(4) of this section.
    (6) To supervise programs for grants to the Republic of the 
Philippines and medical care for Commonwealth Army veterans and 
Philippine Scouts in Veterans Memorial Medical Center, Manila, pursuant 
to the provisions of 38 U.S.C. ch. 17, subch. IV.
    (7) To designate the Deputy Under Secretary for Health of the 
Veterans Health Administration and authority is hereby delegated such 
designee to designate a Department of Veterans

[[Page 129]]

Affairs full-time physician or nonmedical Director to serve as an ex 
officio member on advisory bodies to State Comprehensive Health Planning 
agencies and to individual Regional Medical Programs in those areas in 
which there is located one or more Department of Veterans Affairs 
hospitals or other health facilities, who shall serve on such advisory 
group as the representative of the Department of Veterans Affairs health 
facilities located in that area.
    (8) To authorize Directors of Department of Veterans Affairs 
property and facilities under the charge and control of the Department 
of Veterans Affairs to appoint police officers with the power to enforce 
Federal laws and Department of Veterans Affairs regulations, to 
investigate violations of those laws and to arrest for crimes committed 
on Department of Veterans Affairs property to the full extent provided 
by Department policies and procedures.


(Authority: 38 U.S.C. 501 and 512)

    (9) To develop and establish minimum safety and quality standards 
for adaptive equipment provided under chapter 39 of title 38, United 
States Code, or to appoint a designee to perform these functions.
    (b) Veterans Benefits Administration--(1) General. The Under 
Secretary for Benefits is delegated authority to act on all matters 
assigned to the Veterans Benefits Administration except as provided in 
Sec. 1.771 of this chapter and to authorize supervisory or adjudicative 
personnel within his/her jurisdiction to perform such functions as may 
be assigned.
    (2) Philippines. The Director, Department of Veterans Affairs 
Regional Office, Manila, Philippines, is delegated authority to exercise 
such authorities as are delegated to directors of regional offices in 
the United States, which are appropriate to the administration in the 
Republic of the Philippines of the laws administered by the Department 
of Veterans Affairs.
    (c) Office of Management. (1) The Assistant Secretary for Management 
(Chief Financial Officer) is delegated authority to act on all matters 
assigned to his/her office, and to authorize supervisory personnel 
within his/her jurisdiction to perform such functions as may be 
assigned. Appropriate written notification will be furnished other 
Federal agencies concerning such authorizations.
    (2) The Assistant Secretary for Management (Chief Financial Officer) 
is delegated authority under 31 U.S.C. 1553(c)(1), to approve, in a 
fixed appropriation account to which the period of availability for 
obligation has expired, obligational increases related to contract 
changes when such transaction will cause cumulative obligational 
increase for contract changes during a fiscal year to exceed $4 million 
but not more than $25 million; for this responsibility the Assistant 
Secretary for Management (Chief Financial Officer) shall act as a member 
of the Office of the Secretary and shall report to and consult with the 
Secretary on these matters.
    (d) Assistant Secretary for Management (Chief Financial Officer); 
administration heads and staff office directors. The Assistant Secretary 
for Management (Chief Financial Officer) is delegated authority to take 
appropriate action (other than provided for in paragraphs (e)(3) and 
(e)(4) of this section) in connection with the collection of civil 
claims by VA for money or property, as authorized in Sec. 1.900, et 
seq. The Assistant Secretary for Management (Chief Financial Officer) 
may redelegate such authority as he/she deems appropriate to 
administration heads and staff office directors.


(Authority: 38 U.S.C. 501, 512)

    (e) General Counsel. (1) [Reserved]
    (2) Under the provisions of 38 U.S.C. 515(b), the General Counsel, 
Deputy General Counsel, Assistant General Counsel and Regional Counsel, 
or those authorized to act for them, are authorized to consider, 
ascertain, adjust, determine, and settle tort claims cognizable 
thereunder and to execute an appropriate voucher and other necessary 
instruments in connection with the final disposition of such claims.
    (3) Under the provisions of ``The Federal Medical Care Recovery 
Act,'' 42 U.S.C. 2651, et seq. (as implemented by part 43, title 28, 
Code of Federal Regulations), authority is delegated to the

[[Page 130]]

General Counsel, Deputy General Counsel, Assistant General Counsel 
(Professional Staff Group I), Deputy Assistant General Counsel of said 
staff group, and Regional Counsels or those authorized to act for them, 
to collect in full, compromise, settle, or waive any claim and execute 
the release thereof; however, claims in excess of $100,000 may be 
compromised, settled, or waived only with the prior approval of the 
Department of Justice.
    (4) Under the Federal Claims Collection Act of 1966, 31 U.S.C. 3711, 
et seq., authority is delegated to the General Counsel, Deputy General 
Counsel, Assistant General Counsel, Deputy Assistant General Counsel and 
Regional Counsel, or those authorized to act for them, to:
    (i) Make appropriate determinations with respect to the litigative 
probabilities of a claim (Sec. 1.932 of this chapter), the legal merits 
of a claim (Sec. 1.942(e) of this chapter), and any other legal 
considerations of a claim.
    (ii) Collect in full a claim involving damage to or loss of 
government property under the jurisdiction of the Department of Veterans 
Affairs resulting from negligence or other legal wrong of a person 
(other than an employee of the Government while acting within the scope 
of his or her employment) and to compromise, suspend, or terminate any 
such claim not exceeding $100,000.
    (iii) Collect a claim in full from an individual or legal entity who 
is liable for the cost of hospital, medical, surgical, or dental care 
and treatment of a person, and to compromise, suspend, or terminate any 
such claim not exceeding $100,000.


(Authority: 31 U.S.C. 3711(a)(2); 38 U.S.C. 501, 512)

    (iv) The delegations of authority set forth in paragraphs (e)(4)(ii) 
and (iii) of this section do not apply to the handling of any claim as 
to which there is an indication of fraud, the presentation of a false 
claim or misrepresentation on the part of the debtor or any other party 
having an interest in the claim, or to any claim based in whole or in 
part on conduct in violation of the antitrust laws. Such cases will be 
considered by the General Counsel, who will make the determination in 
all instances as to whether the case warrants referral to the Department 
of Justice. The delegations of authority are applicable to those claims 
where the Department of Justice determines that action based upon the 
alleged fraud, false claim, or misrepresentation is not warranted.
    (5) Pursuant to the provisions of the Military Personnel and 
Civilian Employees' Claim Act of 1964, 31 U.S.C. 3721, as amended, the 
General Counsel, Deputy General Counsel, Assistant General Counsel 
(Professional Staff Group III), Deputy Assistant General Counsel of said 
staff group, and Regional Counsel or those authorized to act for them, 
are authorized to settle and pay a claim for not more than $40,000 made 
by a civilian officer or employee of the Department of Veterans Affairs 
for damage to, or loss of, personal property incident to his or her 
service. (Pub. L. 97-226)
    (6) Under the provisions of 38 U.S.C. 7316(e), authority is 
delegated to the General Counsel, Deputy General Counsel, and the 
Assistant General Counsel (Professional Staff Group I) to hold harmless 
or provide liability insurance for any person to whom the immunity 
provisions of section 7316 apply, for damage for personal injury or 
death, or for property damage, negligently caused by such person while 
furnishing medical care or treatment in the exercise of his or her 
duties in or for the Veterans Health Administration, if such person is 
assigned to a foreign country, detailed to State or political division 
thereof, or is acting under any other circumstances which would preclude 
the remedies of an injured third person against the United States, 
provided by sections 1346(b) and 2672 of title 28, United States Code, 
for such damage or injury.
    (7) The General Counsel, Deputy General Counsel, and those 
authorized to act for them, are authorized to conduct investigations, 
examine witnesses, take affidavits, administer oaths and affirmations, 
and certify copies of public or private documents on all matters within 
the jurisdiction of the General Counsel. Pursuant to the provisions of 
Sec. 2.2(c), the General Counsel, Deputy General Counsel, and those 
authorized

[[Page 131]]

to act for them, are authorized to countersign VA Form 4505.
    (8) The General Counsel, or the Deputy General Counsel acting as or 
for the General Counsel, is authorized to designate, in accordance with 
established standards, those legal opinions of the General Counsel which 
will be considered precedent opinions involving veterans' benefits under 
laws administered by the Department of Veterans Affairs.


(Authority: 38 U.S.C. 501, 512)

    (9) Under the provisions of 38 U.S.C. 1729(c)(1), authority is 
delegated to the General Counsel, Deputy General Counsel, Assistant 
General Counsel (Professional Staff Group I), Deputy Assistant General 
Counsel of said staff group, and Regional Counsel, or those authorized 
to act for them, to collect in full, compromise, settle, or waive any 
claim and execute the release thereof; however, claims in excess of 
$100,000 may only be compromised, settled, or waived with the prior 
approval of the General Counsel, Deputy General Counsel, Assistant 
General Counsel (Professional Staff Group I), or Deputy Assistant 
General Counsel of said staff group, or those authorized to act for 
them.


(Authority: 31 U.S.C. 3711(a)(2); 38 U.S.C. 501, 512).

    (10) The General Counsel and the Deputy General Counsel are 
authorized to make final Departmental decisions on appeals under the 
Freedom of Information Act, the Privacy Act, 38 U.S.C. 5701 and 5705.


(Authority: 38 U.S.C. 512)

    (11) All authority delegated in this paragraph to Regional Counsels 
will be exercised by them under the supervision of and in accordance 
with instructions issued by the General Counsel.
    (f) National Cemetery Administration. Under Secretary for Memorial 
Affairs is delegated authority:
    (1) To act on all matters assigned to the National Cemetery 
Administration by statute (38 U.S.C. chapter 24) and by regulation 
except where specifically requiring the personal attention or action of 
the Secretary and to authorize supervisory personnel within the 
jurisdiction of the Under Secretary for Memorial Affairs, to perform 
such functions as may be assigned.
    (2) To designate, as deemed necessary, Superintendents of National 
Cemeteries as special investigators under 38 U.S.C. 901, however, such 
law enforcement authority is limited to enforcement of rules and 
regulations governing conduct on property under the charge and control 
of the Department of Veterans Affairs, as those rules and regulations 
apply to the cemetery over which the individual Superintendent exercises 
control and jurisdiction. Such designation will not authorize the 
carrying of firearms by any Superintendent.
    (3) To accept donations, except offers of land, made in any manner, 
for the beautification or benefit of national cemeteries.
    (4) To name features in national cemeteries, such as, roads, walks, 
and special structures.
    (5) To establish policies and specifications for inscriptions on 
Government headstones, markers, and private monuments.


(Authority: 38 U.S.C. 501, 512, 2404)

    (g) Inspector General. (1) The Secretary delegates to the Inspector 
General, the authority, as head of the Department of Veterans Affairs, 
to make written requests under the Privacy Act of 1974, 5 U.S.C. 
552a(b)(7), for the transfer of records or copies of records maintained 
by other agencies which are necessary to carry out an authorized law 
enforcement activity of the Office of Inspector General. This delegation 
is made pursuant to 38 U.S.C. 512. The Inspector General may redelegate 
the foregoing authority within the Office of Inspector General, but the 
delegation may only be to an official of sufficient rank to ensure that 
the request for the records has been the subject of a high level 
evaluation of the need for the information.
    (2) The Inspector General delegates the authority under the 
Inspector General Act of 1978, and redelegates the authority under 
paragraph (a) of this section, to request Privacy Act-protected records 
from Federal agencies pursuant to subsection (b)(7) of the Privacy Act

[[Page 132]]

to each of the following Office of Inspector General officials: (i) 
Deputy Inspector General, (ii) Assistant Inspector General for 
Investigations, (iii) Deputy Assistant Inspector General for 
Investigations, (iv) Chief of Operations, and (v) Special Agents in 
Charge of Field Offices of Investigations. These officials may not 
redelegate this authority.


(Authority: 5 U.S.C. 552a)

    (h) Delegations to Office Resolution Management Officials (ORM). (1) 
The Deputy Assistant Secretary for Resolution Management is delegated 
authority to supervise and control the operation of the administrative 
EEO Discrimination Complaint Processing System within the Department.
    (2) The Deputy Assistant Secretary for Resolution Management, the 
Chief Operating Officer, and all Regional EEO Officers/Field Managers 
are delegated authority to make procedural agency decisions to either 
accept or dismiss, in whole or in part, EEO discrimination complaints 
based upon race, color, national origin, sex, religion, age, disability, 
or reprisal filed by employees, former employees, or applicants for 
employment.
    (3) The Deputy Assistant Secretary for Resolution Management, the 
Chief Operating Officer, and the Chief, Policy and Compliance are 
delegated authority to make agency decisions on all breach of settlement 
claims raised by employees, former employees, and applicants for 
employment.
    (4) The Deputy Assistant Secretary for Resolution Management, the 
Chief Operating Officer, and the Chief, Policy and Compliance are 
delegated authority to consider and resolve all claims raised by 
employees, former employees, and applicants for employment that allege 
dissatisfaction with the processing of a previously filed EEO 
discrimination complaint.
    (5) The Deputy Assistant Secretary for Resolution Management, the 
Chief Operating Officer, and the Chief, Policy and Compliance are 
delegated authority to monitor compliance by Department organizational 
components with orders and decisions of the OEDCA and the EEOC.
    (i) Delegations to officials of the Office of Employment 
Discrimination Complaint Adjudication (OEDCA). (1) The Director and 
Associate Director, OEDCA, are delegated authority to make procedural 
decisions to dismiss, in whole or in part, any EEO discrimination 
complaint filed by any employee, former employee, or applicant for 
employment that may be pending before OEDCA, where administrative 
complaint processing efficiency may be best served by doing so.
    (2) The Director and Associate Director, OEDCA, are delegated 
authority to dismiss, in whole or in part any EEO discrimination 
complaint based upon race, color, religion, sex, national origin, age, 
disability, or reprisal filed by any ORM employee, former employee, or 
applicant for employment.
    (3) The Director and Associate Director, OEDCA, are delegated 
authority to make the agency decision on all breach of settlement claims 
raised by ORM employees, former employees, and applicants for 
employment.
    (4) The Director and Associate Director, OEDCA, are delegated 
authority to consider and resolve all claims raised by ORM employees, 
former employees, and applicants for employment that allege 
dissatisfaction with the processing of a previously filed EEO 
discrimination complaint.
    (5) The Director and Associate Director, OEDCA, are delegated 
authority to make procedural agency decisions to either accept or 
dismiss, in whole or in part, EEO discrimination complaints filed by 
employees, former employees, or applicants for employment where the ORM 
must recuse itself from a case due to an actual, apparent, or potential 
conflict of interest.
    (j) Delegation to the Chairman, Board of Veterans' Appeals. In cases 
where OEDCA has recused itself from a case due to an actual, apparent, 
or potential conflict of interest, the Chairman, Board of Veterans' 
Appeals, is delegated authority to make procedural agency decisions to 
dismiss, in whole or in part, EEO discrimination complaints filed by 
agency employees, former employees, and applicants for employment; to 
make substantive final agency decisions where complainants do not 
request an EEOC hearing; to

[[Page 133]]

take final agency action following a decision by an EEOC Administrative 
Judge; and to make final agency decisions ordering appropriate remedies 
and relief where there is a finding of discrimination.
    (k) Processing complaints involving certain officials. A complaint 
alleging that the Secretary or the Deputy Secretary personally made a 
decision directly related to matters in dispute, or are otherwise 
personally involved in such matters, will be referred for procedural 
acceptability review, investigation, and substantive decisionmaking to 
another Federal agency (e.g., The Department of Justice) pursuant to a 
cost reimbursement agreement. Referral will not be made when the action 
complained of relates merely to ministerial involvement in such matters 
(e.g., ministerial approval of selection recommendations submitted to 
the Secretary by the Under Secretary for Health, the Under Secretary for 
Benefits, the Under Secretary for Memorial Affairs, assistant 
secretaries, or staff office heads).
    (l) Assistant to the Secretary, Office of Regulation Policy and 
Management. The Assistant to the Secretary for Regulation Policy and 
Management (ASRPM) is delegated authority:
    (1) To act on all matters assigned to the Office of Regulation 
Policy and Management, except such matters as require the personal 
attention or action of the Secretary, the Deputy Secretary, or the 
Secretary's Regulatory Policy Council.
    (2) To manage and coordinate the Department's rulemaking activities, 
including the revision and reorganization of regulations.
    (3) To serve as the Deputy Regulatory Policy Officer, to perform 
staff functions under the Regulatory Policy Officer, and to perform 
other delegated functions in accordance with Executive Order 12866.

(Authority: 38 U.S.C. 501, 512)

[25 FR 11095, Nov. 23, 1960]

    Editorial Note: For Federal Register citations affecting Sec. 2.6, 
see the List of CFR Sections Affected, which appears in the Finding Aids 
section of the printed volume and on GPO Access.



Sec. 2.7  Delegation of authority to provide relief on account of administrative error.

    (a) Section 503(a) of title 38 U.S.C., provides that if the 
Secretary determines that benefits administered by the Department of 
Veterans Affairs have not been provided by reason of administrative 
error on the part of the Federal Government or any of its employees, the 
Secretary is authorized to provide such relief on account of such error 
as the Secretary determines equitable, including the payment of moneys 
to any person whom he determines equitably entitled thereto.
    (b) Section 503(b) of title 38 U.S.C., provides that if the 
Secretary determines that any veteran, surviving spouse, child of a 
veteran, or other person, has suffered loss, as a consequence of 
reliance upon a determination by the Department of Veterans Affairs of 
eligibility or entitlement to benefits, without knowledge that it was 
erroneously made, the Secretary is authorized to provide such relief as 
the Secretary determines equitable, including the payment of moneys to 
any person equitably entitled thereto. The Secretary is also required to 
submit an annual report to the Congress, containing a brief summary of 
each recommendation for relief and its disposition. Preparation of the 
report shall be the responsibility of the General Counsel.
    (c) The authority to grant the equitable relief, referred to in 
paragraphs (a) and (b) of this section, has not been delegated and is 
reserved to the Secretary. Recommendation for the correction of 
administrative error and for appropriate equitable relief therefrom will 
be submitted to the Secretary, through the General Counsel. Such 
recommendation may be initiated by the head of the administration having 
responsibility for the benefit, or of any concerned staff office, or by 
the Chairman, Board of Veterans Appeals. When a recommendation for 
relief under paragraph (a) or (b) of this section is initiated by the 
head of a staff office, or the Chairman, Board of Veterans Appeals, the 
views of the head of the administration having responsibility for the 
benefit will be obtained and

[[Page 134]]

transmitted with the recommendation of the initiating office.

(Authority: 38 U.S.C. 503, 512)

[37 FR 22864, Oct. 26, 1972, as amended at 49 FR 30693, Aug. 1, 1984; 54 
FR 34981, Aug. 23, 1989; 68 FR 25504, May 13, 2002]



Sec. 2.8  Delegation of authority to authorize allowances for Department of Veterans Affairs employees who are notaries public.

    (a) Employees occupying or acting in the positions designated in 
paragraph (b) of this section are authorized to designate those 
employees who are required to serve as notaries public in connection 
with the performance of official business and to pay an allowance for 
the costs therefor not to exceed the expense required to be incurred by 
them in order to obtain their commission.


(Authority: 5 U.S.C. 5945)

    (b) Designated positions: Deputy Secretary, Under Secretary for 
Benefits, Director, Office of Data Management and Telecommunications, 
Chief Medical Director, General Counsel, Directors of regional offices, 
hospitals, domiciliaries, and centers.

[35 FR 13771, Aug. 29, 1970, as amended at 49 FR 30693, Aug. 1, 1984]



PART 3_ADJUDICATION--Table of Contents




     Subpart A_Pension, Compensation, and Dependency and Indemnity 
                              Compensation

                                 General

Sec.
3.1 Definitions.
3.2 Periods of war.
3.3 Pension.
3.4 Compensation.
3.5 Dependency and indemnity compensation.
3.6 Duty periods.
3.7 Individuals and groups considered to have performed active military, 
          naval, or air service.
3.10 Dependency and indemnity compensation rate for a surviving spouse.
3.11 Homicide.
3.12 Character of discharge.
3.12a Minimum active-duty service requirement.
3.13 Discharge to change status.
3.14 Validity of enlistments.
3.15 Computation of service.
3.16 Service pension.
3.17 Disability and death pension; Mexican border period and later war 
          periods.
3.18-3.19 [Reserved]
3.20 Surviving spouse's benefit for month of veteran's death.
3.21 Monetary rates.
3.22 DIC benefits for survivors of certain veterans rated totally 
          disabled at time of death.
3.23 Improved pension rates--Veterans and surviving spouses.
3.24 Improved pension rates--Surviving children.
3.25 Parents' dependency and indemnity compensation (DIC)--Method of 
          payment computation.
3.26 Section 306 and old-law pension annual income limitations.
3.27 Automatic adjustment of benefit rates.
3.28 Automatic adjustment of section 306 and old-law pension income 
          limitations.
3.29 Rounding.
3.30 Frequency of payment of improved pension and parents' dependency 
          and indemnity compensation (DIC).
3.31 Commencement of the period of payment.
3.32 Exchange rates for foreign currencies.

                                 General

3.40 Philippine and Insular Forces.
3.41 Philippine service.
3.42 Compensation at the full-dollar rate for certain Filipino veterans 
          residing in the United States.
3.43 Burial benefits at the full-dollar rate for certain Filipino 
          veterans residing in the United States on the date of death.

                              Relationship

3.50 Spouse and surviving spouse.
3.52 Marriages deemed valid.
3.53 Continuous cohabitation.
3.54 Marriage dates.
3.55 Reinstatement of benefits eligibility based upon terminated marital 
          relationships.
3.56 [Reserved]
3.57 Child.
3.58 Child adopted out of family.
3.59 Parent.
3.60 Definition of ``living with''.

                             Administrative

3.100 Delegations of authority.
3.102 Reasonable doubt.
3.103 Procedural due process and appellate rights.
3.104 Finality of decisions.
3.105 Revision of decisions.
3.106 Renouncement.
3.107 Awards where not all dependents apply.

[[Page 135]]

3.108 State Department as agent of Department of Veterans Affairs.
3.109 Time limit.
3.110 Computation of time limit.
3.111 [Reserved]
3.112 Fractions of one cent.
3.114 Change of law or Department of Veterans Affairs issue.
3.115 Access to financial records.

                                 Claims

3.150 Forms to be furnished.
3.151 Claims for disability benefits.
3.152 Claims for death benefits.
3.153 Claims filed with Social Security.
3.154 Injury due to hospital treatment, etc.
3.155 Informal claims.
3.156 New and material evidence.
3.157 Report of examination or hospitalization as claim for increase or 
          to reopen.
3.158 Abandoned claims.
3.159 Department of Veterans Affairs assistance in developing claims.
3.160 Status of claims.

                          Evidence Requirements

3.200 Testimony certified or under oath.
3.201 Exchange of evidence; Social Security and Department of Veterans 
          Affairs.
3.202 Evidence from foreign countries.
3.203 Service records as evidence of service and character of discharge.
3.204 Evidence of dependents and age.
3.205 Marriage.
3.206 Divorce.
3.207 Void or annulled marriage.
3.208 Claims based on attained age.
3.209 Birth.
3.210 Child's relationship.
3.211 Death.
3.212 Unexplained absence for 7 years.
3.213 Change of status affecting entitlement.
3.214 Court decisions; unremarried surviving spouses.
3.215 Termination of marital relationship or conduct.
3.216 Mandatory disclosure of social security numbers.
3.217 Submission of statements or information affecting entitlement to 
          benefits.

                      Dependency, Income and Estate

  Regulations Applicable to Programs in Effect Prior to January 1, 1979

3.250 Dependency of parents; compensation.
3.251 Income of parents; dependency and indemnity compensation.
3.252 Annual income; pension; Mexican border period and later war 
          periods.
3.253-3.255 [Reserved]
3.256 Eligibility reporting requirements.
3.257 Children; no surviving spouse entitled.
3.258-3.259 [Reserved]
3.260 Computation of income.
3.261 Character of income; exclusions and estates.
3.262 Evaluation of income.
3.263 Corpus of estate; net worth.
3.270 Applicability of various dependency, income and estate 
          regulations.

  Regulations Applicable to the Improved Pension Program Which Became 
                        Effective January 1, 1979

3.271 Computation of income.
3.272 Exclusions from income.
3.273 Rate computation.
3.274 Relationship of net worth to pension entitlement.
3.275 Criteria for evaluating net worth.
3.276 Certain transfers or waivers disregarded.
3.277 Eligibility reporting requirements.

        Ratings and Evaluations; Basic Entitlement Considerations

3.300 Claims based on the effects of tobacco products.
3.301 Line of duty and misconduct.
3.302 Service connection for mental unsoundness in suicide.

               Ratings and Evaluations; Service Connection

3.303 Principles relating to service connection.
3.304 Direct service connection; wartime and peacetime.
3.305 Direct service connection; peacetime service before January 1, 
          1947.
3.306 Aggravation of preservice disability.
3.307 Presumptive service connection for chronic, tropical or prisoner-
          of-war related disease, or disease associated with exposure to 
          certain herbicide agents; wartime and service on or after 
          January 1, 1947.
3.308 Presumptive service connection; peacetime service before January 
          1, 1947.
3.309 Disease subject to presumptive service connection.
3.310 Disabilities that are proximately due to, or aggravated by, 
          service-connected disease or injury.
3.311 Claims based on exposure to ionizing radiation.
3.312 Cause of death.
3.313 Claims based on service in Vietnam.
3.314 Basic pension determinations.
3.315 Basic eligibility determinations; dependents, loans, education.
3.316 Claims based on chronic effects of exposure to mustard gas and 
          Lewisite.
3.317 Compensation for certain disabilities due to undiagnosed 
          illnesses.
3.318-3.320 [Reserved]
3.321 General rating considerations.
3.322 Rating of disabilities aggravated by service.
3.323 Combined ratings.

[[Page 136]]

3.324 Multiple noncompensable service-connected disabilities.
3.325 [Reserved]
3.326 Examinations.
3.327 Reexaminations.
3.328 Independent medical opinions.
3.329 [Reserved]
3.330 Resumption of rating when veteran subsequently reports for 
          Department of Veterans Affairs examination.
3.331-3.339 [Reserved]
3.340 Total and permanent total ratings and unemployability.
3.341 Total disability ratings for compensation purposes.
3.342 Permanent and total disability ratings for pension purposes.
3.343 Continuance of total disability ratings.
3.344 Stabilization of disability evaluations.

                      Ratings for Special Purposes

3.350 Special monthly compensation ratings.
3.351 Special monthly dependency and indemnity compensation, death 
          compensation, pension and spouse's compensation ratings.
3.352 Criteria for determining need for aid and attendance and 
          ``permanently bedridden.''
3.353 Determinations of incompetency and competency.
3.354 Determinations of insanity.
3.355 Testamentary capacity for insurance purposes.
3.356 Conditions which determine permanent incapacity for self-support.
3.357 Civil service preference ratings.
3.358 Compensation for disability or death from hospitalization, medical 
          or surgical treatment, examinations or vocational 
          rehabilitation training (Sec. 3.800).
3.359 Determination of service connection for former members of the 
          Armed Forces of Czechoslovakia or Poland.
3.360 Service-connected health-care eligibility of certain persons 
          administratively discharged under other than honorable 
          condition.
3.361 Benefits under 38 U.S.C. 1151(a) for additional disability or 
          death due to hospital care, medical or surgical treatment, 
          examination, training and rehabilitation services, or 
          compensated work therapy program.
3.362 Offsets under 38 U.S.C. 1151(b) of benefits awarded under 38 
          U.S.C. 1151(a).
3.363 Bar to benefits under 38 U.S.C. 1151.

           Rating Considerations Relative to Specific Diseases

3.370 Pulmonary tuberculosis shown by X-ray in active service.
3.371 Presumptive service connection for tuberculous disease; wartime 
          and service on or after January 1, 1947.
3.372 Initial grant following inactivity of tuberculosis.
3.373 [Reserved]
3.374 Effect of diagnosis of active tuberculosis.
3.375 Determination of inactivity (complete arrest) in tuberculosis.
3.376-3.377 [Reserved]
3.378 Changes from activity in pulmonary tuberculosis pension cases.
3.379 Anterior poliomyelitis.
3.380 Diseases of allergic etiology.
3.381 Service connection of dental conditions for treatment purposes.
3.382 [Reserved]
3.383 Special consideration for paired organs and extremities.
3.384 Psychosis.
3.385 Disability due to impaired hearing.

                             Effective Dates

3.400 General.
3.401 Veterans.
3.402 Surviving spouse.
3.403 Children.
3.404 Parents.
3.405 Filipino veterans and their survivors; benefits at the full-dollar 
          rate.

                             Apportionments

3.450 General.
3.451 Special apportionments.
3.452 Situations when benefits may be apportioned.
3.453 Veterans compensation or service pension or retirement pay.
3.454 Veterans disability pension.
3.458 Veteran's benefits not apportionable.
3.459 Death compensation.
3.460 Death pension.
3.461 Dependency and indemnity compensation.

                     Reductions and Discontinuances

3.500 General.
3.501 Veterans.
3.502 Surviving spouses.
3.503 Children.
3.504 Parents; aid and attendance.
3.505 Filipino veterans and their survivors; benefits at the full-dollar 
          rate.

                       Hospitalization Adjustments

3.551 Reduction because of hospitalization.
3.552 Adjustment of allowance for aid and attendance.
3.553-3.555 [Reserved]
3.556 Adjustment on discharge or release.
3.557 [Reserved]
3.558 Resumption and payment of withheld benefits; incompetents with 
          estates that equaled or exceeded statutory limit.
3.559 [Reserved]

                       Adjustments and Resumptions

3.650 Rate for additional dependent.

[[Page 137]]

3.651 Change in status of dependents.
3.652 Periodic certification of continued eligibility.
3.653 Foreign residence.
3.654 Active service pay.
3.655 Failure to report for Department of Veterans Affairs examination.
3.656 Disappearance of veteran.
3.657 Surviving spouse becomes entitled, or entitlement terminates.
3.658 Offsets; dependency and indemnity compensation.
3.659 Two parents in same parental line.
3.660 Dependency, income and estate.
3.661 Eligibility Verification Reports.
3.662-3.664 [Reserved]
3.665 Incarcerated beneficiaries and fugitive felons--compensation.
3.666 Incarcerated beneficiaries and fugitive felons--pension.
3.667 School attendance.
3.668 [Reserved]
3.669 Forfeiture.

                    Concurrent Benefits and Elections

3.700 General.
3.701 Elections of pension or compensation.
3.702 Dependency and indemnity compensation.
3.703 Two parents in same parental line.
3.704 Elections within class of dependents.
3.705-3.706 [Reserved]
3.707 Dependents' educational assistance.
3.708 Federal Employees' Compensation.
3.710 Civil service annuitants.
3.711 Improved pension elections.
3.712 Improved pension elections; surviving spouses of Spanish-American 
          War veterans.
3.713 Effective dates of improved pension elections.
3.714 Improved pension elections--public assistance beneficiaries.
3.715 Radiation Exposure Compensation Act of 1990.

                               Retirement

3.750 Entitlement to concurrent receipt of military retired pay and 
          disability compensation.
3.751 Statutory awards; retired service personnel.
3.752 [Reserved]
3.753 Public Health Service.
3.754 Emergency officers' retirement pay.

                            Special Benefits

3.800 Disability or death due to hospitalization, etc.
3.801 Special acts.
3.802 Medal of Honor.
3.803 Naval pension.
3.804 Special allowance under 38 U.S.C. 1312.
3.805 Loan guaranty for surviving spouses; certification.
3.806 Death gratuity; certification.
3.807 Dependents' educational assistance; certification.
3.808 Automobiles or other conveyances; certification.
3.809 Specially adapted housing under 38 U.S.C. 2101(a).
3.809a Special home adaptation grants under 38 U.S.C. 2101(b).
3.810 Clothing allowance.
3.811 Minimum income annuity and gratuitous annuity.
3.812 Special allowance payable under section 156 of Pub. L. 97-377.
3.813 Interim benefits for disability or death due to chloracne or 
          porphyria cutanea tarda.
3.814 Monetary allowance under 38 U.S.C. chapter 18 for an individual 
          suffering from spina bifida whose biological father or mother 
          is or was a Vietnam veteran.
3.815 Monetary allowance under 38 U.S.C. chapter 18 for an individual 
          with disability from covered birth defects whose biological 
          mother is or was a Vietnam veteran; identification of covered 
          birth defects.
3.816 Awards under the Nehmer Court Orders for disability or death 
          caused by a condition presumptively associated with herbicide 
          exposure.

           Incompetents, Guardianship and Institutional Awards

3.850 General.
3.851 St. Elizabeths Hospital, Washington, DC.
3.852 Institutional awards.
3.853 Incompetents; estate over $25,000.
3.854 Limitation on payments for minor.
3.855 Beneficiary rated or reported incompetent.
3.856 Change of name of female fiduciary.
3.857 Children's benefits to fiduciary of surviving spouse.

                               Forfeiture

3.900 General.
3.901 Fraud.
3.902 Treasonable acts.
3.903 Subversive activities.
3.904 Effect of forfeiture after veteran's death.
3.905 Declaration of forfeiture or remission of forfeiture.

                               Protection

3.950 Helpless children; Spanish-American and prior wars.
3.951 Preservation of disability ratings.
3.952 Protected ratings.
3.953 Pub. L. 85-56 and Pub. L. 85-857.
3.954 Burial allowance.
3.955-3.956 [Reserved]
3.957 Service connection.
3.958 Federal employees' compensation cases.

[[Page 138]]

3.959 Tuberculosis.
3.960 Section 306 and old-law pension protection.

                                 Accrued

3.1000 Entitlement under 38 U.S.C. 5121 to benefits due and unpaid upon 
          death of a beneficiary.
3.1001 Hospitalized competent veterans.
3.1002 Political subdivisions of United States.
3.1003 Returned and canceled checks.
3.1004-3.1006 [Reserved]
3.1007 Hospitalized incompetent veterans.
3.1008 Accrued benefits payable to foreign beneficiaries.
3.1009 Personal funds of patients.

                        Subpart B_Burial Benefits

3.1600 Payment of burial expenses of deceased veterans.
3.1601 Claims and evidence.
3.1602 Special conditions governing payments.
3.1603 Authority for burial of certain unclaimed bodies.
3.1604 Payments from non-Department of Veterans Affairs sources.
3.1605 Death while traveling under prior authorization or while 
          hospitalized by the Department of Veterans Affairs.
3.1606 Transportation items.
3.1607 Cost of flags.
3.1608 Nonallowable expenses.
3.1609 Forfeiture.
3.1610 Burial in national cemeteries; burial of unclaimed bodies.
3.1611 Official Department of Veterans Affairs representation at 
          funeral.
3.1612 Monetary allowance in lieu of a Government-furnished headstone or 
          marker.

Subpart C [Reserved]

  Subpart D_Universal Adjudication Rules That Apply to Benefit Claims 
                    Governed by Part 3 of This Title

                                 General

3.2100 Scope of Applicability.
3.2130 Will VA accept a signature by mark or thumbprint?

                                Revisions

3.2600 Review of benefit claims decisions.

    Editorial Note: Nomenclature changes to part 3 appear at 61 FR 7216, 
Feb. 27, 1996; 62 FR 35970, July 3, 1997; 62 FR 47532, Sept. 9, 1997; 
and 67 FR 46868, July 17, 2002.



     Subpart A_Pension, Compensation, and Dependency and Indemnity 
                              Compensation

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

                                 General



Sec. 3.1  Definitions.

    (a) Armed Forces means the United States Army, Navy, Marine Corps, 
Air Force, and Coast Guard, including their Reserve components.
    (b) Reserve component means the Army, Naval, Marine Corps, Air 
Force, and Coast Guard Reserves and the National and Air National Guard 
of the United States.
    (c) Reserves means members of a Reserve component of one of the 
Armed Forces.
    (d) Veteran means a person who served in the active military, naval, 
or air service and who was discharged or released under conditions other 
than dishonorable.
    (1) For compensation and dependency and indemnity compensation the 
term veteran includes a person who died in active service and whose 
death was not due to willful misconduct.
    (2) For death pension the term veteran includes a person who died in 
active service under conditions which preclude payment of service-
connected death benefits, provided such person had completed at least 2 
years honorable military, naval or air service, as certified by the 
Secretary concerned. (See Sec. Sec. 3.3(b)(3)(i) and 3.3(b)(4)(i))


(Authority: 38 U.S.C. 501)

    (e) Veteran of any war means any veteran who served in the active 
military, naval or air service during a period of war as set forth in 
Sec. 3.2.
    (f) Period of war means the periods described in Sec. 3.2.
    (g) Secretary concerned means:
    (1) The Secretary of the Army, with respect to matters concerning 
the Army;
    (2) The Secretary of the Navy, with respect to matters concerning 
the Navy or the Marine Corps;
    (3) The Secretary of the Air Force, with respect to matters 
concerning the Air Force;

[[Page 139]]

    (4) The Secretary of Homeland Security, with respect to matters 
concerning the Coast Guard;
    (5) The Secretary of Health and Human Services, with respect to 
matters concerning the Public Health Service; and
    (6) The Secretary of Commerce, with respect to matters concerning 
the Coast and Geodetic Survey, the Environmental Science Services 
Administration, and the National Oceanic and Atmospheric Administration.
    (h) Discharge or release includes retirement from the active 
military, naval, or air service.
    (i) State means each of the several States, Territories and 
possessions of the United States, the District of Columbia, and 
Commonwealth of Puerto Rico.
    (j) Marriage means a marriage valid under the law of the place where 
the parties resided at the time of marriage, or the law of the place 
where the parties resided when the right to benefits accrued.


(Authority: 38 U.S.C. 103(c))

    (k) Service-connected means, with respect to disability or death, 
that such disability was incurred or aggravated, or that the death 
resulted from a disability incurred or aggravated, in line of duty in 
the active military, naval, or air service.
    (l) Nonservice-connected means, with respect to disability or death, 
that such disability was not incurred or aggravated, or that the death 
did not result from a disability incurred or aggravated, in line of duty 
in the active military, naval, or air service.
    (m) In line of duty means an injury or disease incurred or 
aggravated during a period of active military, naval, or air service 
unless such injury or disease was the result of the veteran's own 
willful misconduct or, for claims filed after October 31, 1990, was a 
result of his or her abuse of alcohol or drugs. A service department 
finding that injury, disease or death occurred in line of duty will be 
binding on the Department of Veterans Affairs unless it is patently 
inconsistent with the requirements of laws administered by the 
Department of Veterans Affairs. Requirements as to line of duty are not 
met if at the time the injury was suffered or disease contracted the 
veteran was:
    (1) Avoiding duty by desertion, or was absent without leave which 
materially interfered with the performance of military duty.
    (2) Confined under a sentence of court-martial involving an 
unremitted dishonorable discharge.
    (3) Confined under sentence of a civil court for a felony as 
determined under the laws of the jurisdiction where the person was 
convicted by such court.


(Authority: 38 U.S.C. 105)

    Note: See Sec. 3.1(y)(2)(iii) for applicability of in line of duty 
in determining former prisoner of war status.

    (n) Willful misconduct means an act involving conscious wrongdoing 
or known prohibited action. A service department finding that injury, 
disease or death was not due to misconduct will be binding on the 
Department of Veterans Affairs unless it is patently inconsistent with 
the facts and the requirements of laws administered by the Department of 
Veterans Affairs.
    (1) It involves deliberate or intentional wrongdoing with knowledge 
of or wanton and reckless disregard of its probable consequences.
    (2) Mere technical violation of police regulations or ordinances 
will not per se constitute willful misconduct.
    (3) Willful misconduct will not be determinative unless it is the 
proximate cause of injury, disease or death. (See Sec. Sec. 3.301, 
3.302.)
    (o) Political subdivision of the United States includes the 
jurisdiction defined as a State in paragraph (i) of this section, and 
the counties, cities or municipalities of each.
    (p) Claim--Application means a formal or informal communication in 
writing requesting a determination of entitlement or evidencing a belief 
in entitlement, to a benefit.
    (q) Notice means written notice sent to a claimant or payee at his 
or her latest address of record.
    (r) Date of receipt means the date on which a claim, information or 
evidence was received in the Department of Veterans Affairs, except as 
to specific provisions for claims or evidence received in the State 
Department (Sec. 3.108), or in the Social Security Administration

[[Page 140]]

(Sec. Sec. 3.153, 3.201), or Department of Defense as to initial claims 
filed at or prior to separation. However, the Under Secretary for 
Benefits may establish, by notice published in the Federal Register, 
exceptions to this rule, using factors such as postmark or the date the 
claimant signed the correspondence, when he or she determines that a 
natural or man-made interference with the normal channels through which 
the Veterans Benefits Administration ordinarily receives correspondence 
has resulted in one or more Veterans Benefits Administration offices 
experiencing extended delays in receipt of claims, information, or 
evidence from claimants served by the affected office or offices to an 
extent that, if not addressed, would adversely affect such claimants 
through no fault of their own.


(Authority: 38 U.S.C. 501(a), 512(a), 5110)

    (s) On the borders thereof means, with regard to service during the 
Mexican border period, the States of Arizona, California, New Mexico, 
and Texas, and the nations of Guatemala and British Honduras.


(Authority: 38 U.S.C. 101(30))

    (t) In the waters adjacent thereto means, with regard to service 
during the Mexican border period, the waters (including the islands 
therein) which are within 750 nautical miles (863 statute miles) of the 
coast of the mainland of Mexico.


(Authority: 38 U.S.C. 101(30)

    (u) Section 306 pension means those disability and death pension 
programs in effect on December 31, 1978, which arose out of Pub. L. 86-
211; 73 Stat. 432.
    (v) Old-Law pension means the disability and death pension programs 
that were in effect on June 30, 1960. Also known as protected pension, 
i.e. protected under section 9(b) of the Veteran's Pension Act of 1959 
(Pub. L. 86-211; 73 Stat. 432).
    (w) Improved pension means the disability and death pension programs 
becoming effective January 1, 1979, under authority of Pub. L. 95-588; 
92 Stat. 2497.
    (x) Service pension is the name given to Spanish-American War 
pension. It is referred to as a service pension because entitlement is 
based solely on service without regard to nonservice-connected 
disability, income and net worth.


(Authority: 38 U.S.C. 1512, 1536)

    (y) Former prisoner of war. The term former prisoner of war means a 
person who, while serving in the active military, naval or air service, 
was forcibly detained or interned in the line of duty by an enemy or 
foreign government, the agents of either, or a hostile force.
    (1) Decisions based on service department findings. The Department 
of Veterans Affairs shall accept the findings of the appropriate service 
department that a person was a prisoner of war during a period of war 
unless a reasonable basis exists for questioning it. Such findings shall 
be accepted only when detention or internment is by an enemy government 
or its agents.
    (2) Other decisions. In all other situations, including those in 
which the Department of Veterans Affairs cannot accept the service 
department findings, the following factors shall be used to determine 
prisoner of war status:
    (i) Circumstances of detention or internment. To be considered a 
former prisoner of war, a serviceperson must have been forcibly detained 
or interned under circumstances comparable to those under which persons 
generally have been forcibly detained or interned by enemy governments 
during periods of war. Such circumstances include, but are not limited 
to, physical hardships or abuse, psychological hardships or abuse, 
malnutrition, and unsanitary conditions. Each individual member of a 
particular group of detainees or internees shall, in the absence of 
evidence to the contrary, be considered to have experienced the same 
circumstances as those experienced by the group.
    (ii) Reason for detainment or internment. The reason for which a 
serviceperson was detained or interned is immaterial in determining POW 
status, except that a serviceperson who is detained or interned by a 
foreign government for an alleged violation of its laws is not entitled 
to be considered a

[[Page 141]]

former POW on the basis of that period of detention or internment, 
unless the charges are a sham intended to legitimize the period of 
detention or internment.
    (3) Central Office approval. The Director of the Compensation and 
Pension Service, VA Central Office, shall approve all VA regional office 
determinations establishing or denying POW status, with the exception of 
those service department determinations accepted under paragraph (y)(1) 
of this section.
    (4) In line of duty. The Department of Veterans Affairs shall 
consider that a serviceperson was forcibly detained or interned in line 
of duty unless the evidence of record discloses that forcible detainment 
or internment was the proximate result of the serviceperson's own 
willful misconduct.
    (5) Hostile force. The term hostile force means any entity other 
than an enemy or foreign government or the agents of either whose 
actions are taken to further or enhance anti-American military, 
political or economic objectives or views, or to attempt to embarrass 
the United States.


(Authority: 38 U.S.C. 101(32))

    (z) Nursing home means
    (1) Any extended care facility which is licensed by a State to 
provide skilled or intermediate-level nursing care,
    (2) A nursing home care unit in a State veterans' home which is 
approved for payment under 38 U.S.C. 1742, or
    (3) A Department of Veterans Affairs Nursing Home Care Unit.
    (aa) Fraud:
    (1) As used in 38 U.S.C. 103 and implementing regulations, fraud 
means an intentional misrepresentation of fact, or the intentional 
failure to disclose pertinent facts, for the purpose of obtaining, or 
assisting an individual to obtain an annulment or divorce, with 
knowledge that the misrepresentation or failure to disclose may result 
in the erroneous granting of an annulment or divorce; and


(Authority: 38 U.S.C. 501)

    (2) As used in 38 U.S.C. 110 and 1159 and implementing regulations, 
fraud means an intentional misrepresentation of fact, or the intentional 
failure to disclose pertinent facts, for the purpose of obtaining or 
retaining, or assisting an individual to obtain or retain, eligibility 
for Department of Veterans Affairs benefits, with knowledge that the 
misrepresentation or failure to disclose may result in the erroneous 
award or retention of such benefits.

(Authority: 38 U.S.C. 501)

    Cross-References: Pension. See Sec. 3.3. Compensation. See Sec. 
3.4. Dependency and indemnity compensation. See Sec. 3.5. Preservation 
of disability ratings. See Sec. 3.951. Service-connection. See Sec. 
3.957.

[26 FR 1563, Feb. 24, 1961]

    Editorial Note: For Federal Register citations affecting Sec. 3.1, 
see the List of Sections Affected, which appears in the Finding Aids 
section of the printed volume and on GPO Access.



Sec. 3.2  Periods of war.

    This section sets forth the beginning and ending dates of each war 
period beginning with the Indian wars. Note that the term period of war 
in reference to pension entitlement under 38 U.S.C. 1521, 1541 and 1542 
means all of the war periods listed in this section except the Indian 
wars and the Spanish-American War. See Sec. 3.3(a)(3) and (b)(4)(i).
    (a) Indian wars. January 1, 1817, through December 31, 1898, 
inclusive. Service must have been rendered with the United States 
military forces against Indian tribes or nations.
    (b) Spanish-American War. April 21, 1898, through July 4, 1902, 
inclusive. If the veteran served with the United States military forces 
engaged in hostilities in the Moro Province, the ending date is July 15, 
1903. The Philippine Insurrection and the Boxer Rebellion are included.
    (c) World War I. April 6, 1917, through November 11, 1918, 
inclusive. If the veteran served with the United States military forces 
in Russia, the ending date is April 1, 1920. Service after November 11, 
1918 and before July 2, 1921 is considered World War I service if the 
veteran served in the active military, naval, or air service after April 
5, 1917 and before November 12, 1918.
    (d) World War II. December 7, 1941, through December 31, 1946, 
inclusive. If the veteran was in service on December 31, 1946, 
continuous service before July

[[Page 142]]

26, 1947, is considered World War II service.
    (e) Korean conflict. June 27, 1950, through January 31, 1955, 
inclusive.
    (f) Vietnam era. The period beginning on February 28, 1961, and 
ending on May 7, 1975, inclusive, in the case of a veteran who served in 
the Republic of Vietnam during that period. The period beginning on 
August 5, 1964, and ending on May 7, 1975, inclusive, in all other 
cases.


(Authority: 38 U.S.C. 101(29))

    (g) Future dates. The period beginning on the date of any future 
declaration of war by the Congress and ending on a date prescribed by 
Presidential proclamation or concurrent resolution of the Congress.


(Authority: 38 U.S.C. 101)

    (h) Mexican border period. May 9, 1916, through April 5, 1917, in 
the case of a veteran who during such period served in Mexico, on the 
borders thereof, or in the waters adjacent thereto.


(Authority: 38 U.S.C. 101(30))

    (i) Persian Gulf War. August 2, 1990, through date to be prescribed 
by Presidential proclamation or law.

(Authority: 38 U.S.C. 101(33))

[26 FR 1563, Feb. 24, 1961, as amended at 32 FR 13223, Sept. 19, 1967; 
36 FR 8445, May 6, 1971; 37 FR 6676, Apr. 1, 1972; 40 FR 27030, June 26, 
1975; 44 FR 45931, Aug. 6, 1979; 56 FR 57986, Nov. 15, 1991; 62 FR 
35422, July 1, 1997]



Sec. 3.3  Pension.

    (a) Pension for veterans--(1) Service pension; Spanish-American War. 
A benefit payable monthly by the Department of Veterans Affairs because 
of service in the Spanish-American War. Basic entitlement exists if a 
veteran:
    (i) Had 70 (or 90) days or more active service during the Spanish-
American War; or
    (ii) Was discharged or released from such service for a disability 
adjudged service connected without benefit of presumptive provisions of 
law, or at the time of discharge had such a service-connected 
disability, shown by official service records, which in medical judgment 
would have justified a discharge for disability.


(Authority: 38 U.S.C. 1512)

    (2) Section 306 pension. A benefit payable monthly by the Department 
of Veterans Affairs because of nonservice-connected disability or age. 
Basic entitlement exists if a veteran:
    (i) Served 90 days or more in either the Mexican border period, 
World War I, World War II, the Korean conflict, or the Vietnam era, or 
served an aggregate of 90 days or more in separate periods of service 
during the same or during different war periods, including service 
during the Spanish-American War (Pub. L. 87-101, 75 Stat. 218; Pub. L. 
90-77, 81 Stat. 178; Pub. L. 92-198, 85 Stat. 663); or
    (ii) Served continuously for a period of 90 consecutive days or more 
and such period ended during the Mexican border period or World War I, 
or began or ended during World War II, the Korean conflict or the 
Vietnam era (Pub. L. 87-101, 75 Stat. 218; Pub. L. 88-664, 78 Stat. 
1094; Pub. L. 90-77, 81 Stat. 178; Pub. L. 91-588, 84 Stat. 1580; Pub. 
L. 92-198, 85 Stat. 663; Pub. L. 94-169, 89 Stat. 1013; Pub. L. 95-204, 
91 Stat. 1455); or
    (iii) Was discharged or released from such wartime service, before 
having served 90 days, for a disability adjudged service connected 
without the benefit of presumptive provisions of law, or at the time of 
discharge had such a service-connected disability, shown by official 
service records, which in medical judgment would have justified a 
discharge for disability; and
    (iv) Is permanently and totally disabled (a) from nonservice-
connected disability not due to the veteran's own willful misconduct or 
vicious habits, or (b) by reason of having attained the age of 65 years 
or by reason of having become unemployable after age 65; and
    (v)(a) Is in receipt of section 306 pension or (b) has an 
application for pension pending on December 31, 1978, or (c) meets the 
age or disability requirements for such pension on December 31, 1978, 
and files a claim within 1 year of that date and also within 1 year 
after meeting the age or disability requirements.
    (vi) Meets the income and net worth requirements of 38 U.S.C. 1521 
and 1522

[[Page 143]]

as in effect on December 31, 1978, and all other provisions of title 38, 
United States Code, in effect on December 31, 1978, applicable to 
section 306 pension.

    Note: The pension provisions of title 38 U.S.C., as in effect on 
December 31, 1978, are available in any VA regional office.

    (3) Improved pension; Pub. L. 95-588 (92 Stat. 2497). A benefit 
payable by the Department of Veterans Affairs to veterans of a period or 
periods of war because of nonservice-connected disability or age. The 
qualifying periods of war for this benefit are the Mexican border 
period, World War I, World War II, the Korean conflict, the Vietnam era 
and the Persian Gulf War. Payments are made monthly unless the amount of 
the annual benefit is less than 4 percent of the maximum annual rate 
payable to a veteran under 38 U.S.C. 1521(b), in which case payments may 
be made less frequently than monthly. Basic entitlement exists if a 
veteran:
    (i) Served in the active military, naval or air service for 90 days 
or more during a period of war (38 U.S.C. 1521(j)); or
    (ii) Served in the active military, naval or air service during a 
period of war and was discharged or released from such service for a 
disability adjudged service-connected without presumptive provisions of 
law, or at time of discharge had such a service-connected disability, 
shown by official service records, which in medical judgment would have 
justified a discharge for disability (38 U.S.C. 1521(j)); or
    (iii) Served in the active military, naval or air service for a 
period of 90 consecutive days or more and such period began or ended 
during a period of war (38 U.S.C. 1521(j)); or
    (iv) Served in the active military, naval or air service for an 
aggregate of 90 days or more in two or more separate periods of service 
during more than one period of war (38 U.S.C. 1521(j)); and
    (v) Meets the net worth requirements under Sec. 3.274 and does not 
have an annual income in excess of the applicable maximum annual pension 
rate specified in Sec. 3.23; and
    (vi)(A) Is age 65 or older; or
    (B) Is permanently and totally disabled from nonservice-connected 
disability not due to the veteran's own willfull misconduct. For 
purposes of this paragraph, a veteran is considered permanently and 
totally disabled if the veteran is any of the following:
    (1) A patient in a nursing home for long-term care because of 
disability; or
    (2) Disabled, as determined by the Commissioner of Social Security 
for purposes of any benefits administered by the Commissioner; or
    (3) Unemployable as a result of disability reasonably certain to 
continue throughout the life of the person; or
    (4) Suffering from:
    (i) Any disability which is sufficient to render it impossible for 
the average person to follow a substantially gainful occupation, but 
only if it is reasonably certain that such disability will continue 
throughout the life of the person; or
    (ii) Any disease or disorder determined by VA to be of such a nature 
or extent as to justify a determination that persons suffering from that 
disease or disorder are permanently and totally disabled.


(Authority: 38 U.S.C. 1502(a), 1513, 1521, 1522)

    (b) Pension for survivors--(1) Indian war death pension. A monthly 
benefit payable by the Department of Veterans Affairs to the surviving 
spouse or child of a deceased veteran of an Indian war. Basic 
entitlement exists if a veteran had qualifying service as specified in 
38 U.S.C. 1511. Indian war death pension rates are set forth in 38 
U.S.C. 1534 and 1535.
    (2) Spanish-American War death pension. A monthly benefit payable by 
the Department of Veterans Affairs to the surviving spouse or child of a 
deceased veteran of the Spanish-American War, if the veteran:
    (i) Had 90 days or more active service during the Spanish-American 
War; or
    (ii) Was discharged or released from such service for a disability 
service-connected without benefit of presumptive provisions of law, or 
at time of discharge had such a service-connected disability, as shown 
by official service records, which in medical judgment would have 
justified a discharge for disability.


(Authority: 38 U.S.C. 1536, 1537)


[[Page 144]]


    (3) Section 306 death pension. A monthly benefit payable by the 
Department of Veterans Affairs to a surviving spouse or child because of 
a veteran's nonservice-connected death. Basic entitlement exists if:
    (i) The veteran (as defined in Sec. 3.1(d) and (d)(2)) had 
qualifying service as specified in paragraph (a)(2)(i), (ii), or (iii) 
of this section; or
    (ii) The veteran was, at time of death, receiving or entitled to 
receive compensation or retired pay for service-connected disability 
based on wartime service; and
    (iii) The surviving spouse or child (A) was in receipt of section 
306 pension on December 31, 1978, or (B) had a claim for pension pending 
on that date, or (C) filed a claim for pension after that date but 
within 1 year after the veteran's death, if the veteran died before 
January 1, 1979; and
    (iv) The surviving spouse or child meets the income and net worth 
requirements of 38 U.S.C. 1541, 1542 or 1543 as in effect on December 
31, 1978, and all other provisions of title 38, United States Code in 
effect on December 31, 1978, applicable to section 306 pension.

    Note: The pension provisions of title 38, United States Code, as in 
effect on December 31, 1978, are available in any VA regional office.)

    (4) Improved death pension, Public Law 95-588. A benefit payable by 
the Department of Veterans Affairs to a veteran's surviving spouse or 
child because of the veteran's nonservice-connected death. Payments are 
made monthly unless the amount of the annual benefit is less than 4 
percent of the maximum annual rate payable to a veteran under 38 U.S.C. 
1521(b), in which case payments may be made less frequently than 
monthly. Basic entitlement exists if:
    (i) The veteran (as defined in Sec. 3.1(d) and (d)(2)) had 
qualifying service as specified in paragraph (a)(3)(i), (ii), (iii), or 
(iv) of this section (38 U.S.C. 1541(a)); or
    (ii) The veteran was, at time of death, receiving or entitled to 
receive compensation or retired pay for a service-connected disability 
based on service during a period of war. (The qualifying periods of war 
are specified in paragraph (a)(3) of this section.) (38 U.S.C. 1541(a)); 
and
    (iii) The surviving spouse or child meets the net worth requirements 
of Sec. 3.274 and has an annual income not in excess of the applicable 
maximum annual pension rate specified in Sec. Sec. 3.23 and 3.24.

(Authority: 38 U.S.C. 1541 and 1542)

    Cross References: Section 306 pension. See Sec. 3.1(u). Improved 
pension. See Sec. 3.1(w). Improved pension rates. See Sec. 3.23. 
Improved pension rates; surviving children. See Sec. 3.24. Frequency of 
payment of improved pension. See Sec. 3.30. Relationship of net worth 
to pension entitlement. See Sec. 3.274.

[44 FR 45931, Aug. 6, 1979, as amended at 56 FR 19579, Apr. 29, 1991; 56 
FR 22910, May 17, 1991; 56 FR 25044, June 3, 1991; 56 FR 57986, Nov. 15, 
1991; 68 FR 34541, June 10, 2003]



Sec. 3.4  Compensation.

    (a) Compensation. This term means a monthly payment made by the 
Department of Veterans Affairs to a veteran because of service-connected 
disability, or to a surviving spouse, child, or parent of a veteran 
because of the service-connected death of the veteran occurring before 
January 1, 1957, or under the circumstances outlined in paragraph (c)(2) 
of this section. If the veteran was discharged or released from service, 
the discharge or release must have been under conditions other than 
dishonorable.


(Authority: 38 U.S.C. 101(2), (13))

    (b) Disability compensation. (1) Basic entitlement for a veteran 
exists if the veteran is disabled as the result of a personal injury or 
disease (including aggravation of a condition existing prior to service) 
while in active service if the injury or the disease was incurred or 
aggravated in line of duty.


(Authority: 38 U.S.C. 1110, 1131)

    (2) An additional amount of compensation may be payable for a 
spouse, child, and/or dependent parent where a veteran is entitled to 
compensation based on disability evaluated as 30 per centum or more 
disabling.


(Authority: 38 U.S.C. 1115)

    (c) Death compensation. Basic entitlement exists for a surviving 
spouse,

[[Page 145]]

child or children, and dependent parent or parents if:
    (1) The veteran died before January 1, 1957; or
    (2) The veteran died on or after May 1, 1957, and before January 1, 
1972, if at the time of death a policy of United States Government Life 
Insurance or National Service Life Insurance was in effect under waiver 
of premiums under 38 U.S.C. 1924 unless the waiver was granted under the 
first proviso of section 622(a) of the National Service Life Insurance 
Act of 1940, and the veteran died before return to military jurisdiction 
or within 120 days thereafter. (See Sec. 3.5(d) as to Public Health 
Service.)

(Authority: 38 U.S.C. 1121, 1141)

[26 FR 1564, Feb. 24, 1961, as amended at 38 FR 21923, Aug. 14, 1973; 39 
FR 34529, Sept. 26, 1974; 44 FR 22717, Apr. 17, 1979]



Sec. 3.5  Dependency and indemnity compensation.

    (a) Dependency and indemnity compensation. This term means a monthly 
payment made by the Department of Veterans Affairs to a surviving 
spouse, child, or parent:
    (1) Because of a service-connected death occurring after December 
31, 1956, or
    (2) Pursuant to the election of a surviving spouse, child, or 
parent, in the case of such a death occurring before January 1, 1957.


(Authority: 38 U.S.C. 101 (14))

    (b) Entitlement. Basic entitlement for a surviving spouse, child or 
children, and parent or parents of a veteran exists, if:
    (1) Death occurred on or after January 1, 1957, except in the 
situation specified in Sec. 3.4(c)(2); or
    (2) Death occurred prior to January 1, 1957, and the claimant was 
receiving or eligible to receive death compensation on December 31, 1956 
(or, as to a parent, would have been eligible except for income), under 
laws in effect on that date or who subsequently becomes eligible by 
reason of a death which occurred prior to January 1, 1957; or
    (3) Death occurred on or after May 1, 1957, and before January 1, 
1972, and the claimant had been ineligible to receive dependency and 
indemnity compensation because of the exception in subparagraph (1) of 
this paragraph. In such case dependency and indemnity compensation is 
payable upon election.


(38 U.S.C. 1310, 1316, 1317, Public Law 92-197, 85 Stat. 660)

    (c) Exclusiveness of remedy. No person eligible for dependency and 
indemnity compensation by reason of a death occurring on or after 
January 1, 1957, shall be eligible by reason of such death for death 
pension or compensation under any other law administered by the 
Department of Veterans Affairs, except that, effective November 2, 1994, 
a surviving spouse who is receiving dependency and indemnity 
compensation may elect to receive death pension instead of such 
compensation.


(Authority: 38 U.S.C. 1317)

    (d) Group life insurance. No dependency and indemnity compensation 
or death compensation shall be paid to any surviving spouse, child or 
parent based on the death of a commissioned officer of the Public Health 
Service, the Coast and Geodetic Survey, the Environmental Science 
Services Administration, or the National Oceanic and Atmospheric 
Administration occuring on or after May 1, 1957, if any amounts are 
payable under the Federal Employees' Group Life Insurance Act of 1954 
(Pub. L. 598, 83d Cong., as amended) based on the same death.


(Authority: Sec. 501(c)(2), Pub. L. 881, 84th Cong. (70 Stat. 857), as 
amended by Sec. 13(u), Pub. L. 85-857; (72 Stat. 1266); Sec. 5, Pub. L. 
91-621 (84 Stat. 1863))

[29 FR 10396, July 25, 1964, as amended at 35 FR 18661, Dec. 9, 1970; 37 
FR 6676, Apr. 1, 1972; 39 FR 34529, Sept. 26, 1974; 44 FR 22717, Apr. 
17, 1979; 58 FR 25561, Apr. 27, 1993; 58 FR 27622, May 10, 1993; 60 FR 
18355, Apr. 11, 1995; 70 FR 72220, Dec. 2, 2005; 73 FR 23356, Apr. 30, 
2008]



Sec. 3.6  Duty periods.

    (a) Active military, naval, and air service. This includes active 
duty, any period of active duty for training during which the individual 
concerned was disabled or died from a disease or injury incurred or 
aggravated in line of duty, and any period of inactive duty training 
during which the individual concerned was disabled or died from an

[[Page 146]]

injury incurred or aggravated in line of duty or from an acute 
myocardial infarction, a cardiac arrest, or a cerebrovascular accident 
which occurred during such training.


(Authority: 38 U.S.C. 101(24))

    (b) Active duty. This means:
    (1) Full-time duty in the Armed Forces, other than active duty for 
training;
    (2) Full-time duty (other than for training purposes) as a 
commissioned officer of the Regular or Reserve Corps of the Public 
Health Service:
    (i) On or after July 29, 1945, or
    (ii) Before that date under circumstances affording entitlement to 
full military benefits, or
    (iii) At any time, for the purposes of dependency and indemnity 
compensation.
    (3) Full-time duty as a commissioned officer of the Coast and 
Geodetic Survey or of its successor agencies, the Environmental Science 
Services Administration and the National Oceanic and Atmospheric 
Administration:
    (i) On or after July 29, 1945, or
    (ii) Before that date:
    (a) While on transfer to one of the Armed Forces, or
    (b) While, in time of war or national emergency declared by the 
President, assigned to duty on a project for one of the Armed Forces in 
an area determined by the Secretary of Defense to be of immediate 
military hazard, or
    (c) In the Philippine Islands on December 7, 1941, and continuously 
in such islands thereafter, or
    (iii) At any time, for the purposes of dependency and indemnity 
compensation.
    (4) Service at any time as a cadet at the United States Military, 
Air Force, or Coast Guard Academy, or as a midshipman at the United 
States Naval Academy;
    (5) Attendance at the preparatory schools of the United States Air 
Force Academy, the United States Military Academy, or the United States 
Naval Academy for enlisted active-duty members who are reassigned to a 
preparatory school without a release from active duty, and for other 
individuals who have a commitment to active duty in the Armed Forces 
that would be binding upon disenrollment from the preparatory school;
    (6) Authorized travel to or from such duty or service; and
    (7) A person discharged or released from a period of active duty, 
shall be deemed to have continued on active duty during the period of 
time immediately following the date of such discharge or release from 
such duty determined by the Secretary concerned to have been required 
for him or her to proceed to his or her home by the most direct route, 
and, in all instances, until midnight of the date of such discharge or 
release.


(Authority: 38 U.S.C. 106(c))

    (c) Active duty for training. (1) Full-time duty in the Armed Forces 
performed by Reserves for training purposes;
    (2) Full-time duty for training purposes performed as a commissioned 
officer of the Reserve Corps of the Public Health Service:
    (i) On or after July 29, 1945, or
    (ii) Before that date under circumstances affording entitlement to 
full military benefits, or
    (iii) At any time, for the purposes of dependency and indemnity 
compensation:
    (3) Full-time duty performed by members of the National Guard of any 
State, under 32 U.S.C. 316, 502, 503, 504, or 505, or the prior 
corresponding provisions of law or full-time duty by such members while 
participating in the reenactment of the Battle of First Manassas in July 
1961;
    (4) Duty performed by a member of a Senior Reserve Officers' 
Training Corps program when ordered to such duty for the purpose of 
training or a practice cruise under chapter 103 of title 10 U.S.C.
    (i) The requirements of this paragraph are effective--
    (A) On or after October 1, 1982, with respect to deaths and 
disabilities resulting from diseases or injuries incurred or aggravated 
after September 30, 1982, and
    (B) October 1, 1983, with respect to deaths and disabilities 
resulting from diseases or injuries incurred or aggravated before 
October 1, 1982.

[[Page 147]]

    (ii) Effective on or after October 1, 1988, such duty must be 
prerequisite to the member being commissioned and must be for a period 
of at least four continuous weeks.


(Authority: 38 U.S.C. 101(22)(D) as amended by Pub. L. 100-456)

    (5) Attendance at the preparatory schools of the United States Air 
Force Academy, the United States Military Academy, or the United States 
Naval Academy by an individual who enters the preparatory school 
directly from the Reserves, National Guard or civilian life, unless the 
individual has a commitment to service on active duty which would be 
binding upon disenrollment from the preparatory school.
    (6) Authorized travel to or from such duty.


(Authority: 38 U.S.C. 101(22))


The term does not include duty performed as a temporary member of the 
Coast Guard Reserve.
    (d) Inactive duty training. This means: (1) Duty (other than full-
time duty) prescribed for Reserves (including commissioned officers of 
the Reserve Corps of the Public Health Service) by the Secretary 
concerned under 37 U.S.C. 206 or any other provision of law;
    (2) Special additional duties authorized for Reserves (including 
commissioned officers of the Reserve Corps of the Public Health Service) 
by an authority designated by the Secretary concerned and performed by 
them on a voluntary basis in connection with the prescribed training or 
maintenance activities of the units to which they are assigned; and
    (3) Training (other than active duty for training) by a member of, 
or applicant for membership (as defined in 5 U.S.C. 8140(g)) in, the 
Senior Reserve Officers' Training Corps prescribed under chapter 103 of 
title 10 U.S.C.
    (4) Duty (other than full-time duty) performed by a member of the 
National Guard of any State, under 32 U.S.C. 316, 502, 503, 504, or 505, 
or the prior corresponding provisions of law. The term inactive duty 
training does not include:
    (i) Work or study performed in connection with correspondence 
courses,
    (ii) Attendance at an educational institution in an inactive status, 
or
    (iii) Duty performed as a temporary member of the Coast Guard 
Reserve.


(Authority: 38 U.S.C. 101(23))

    (e) Travel status--training duty (disability or death from injury or 
covered disease). Any individual:
    (1) Who, when authorized or required by competent authority, assumes 
an obligation to perform active duty for training or inactive duty 
training; and
    (2) Who is disabled or dies from an injury or covered disease 
incurred while proceeding directly to or returning directly from such 
active duty for training or inactive duty training shall be deemed to 
have been on active duty for training or inactive duty training, as the 
case may be. The Department of Veterans Affairs will determine whether 
such individual was so authorized or required to perform such duty, and 
whether the individual was disabled or died from an injury or covered 
disease so incurred. In making such determinations, there shall be taken 
into consideration the hour on which the individual began to proceed or 
return; the hour on which the individual was scheduled to arrive for, or 
on which the individual ceased to perform, such duty; the method of 
travel performed; the itinerary; the manner in which the travel was 
performed; and the immediate cause of disability or death. Whenever any 
claim is filed alleging that the claimant is entitled to benefits by 
reason of this paragraph, the burden of proof shall be on the claimant.
    (3) For purposes of this section, the term covered disease means any 
of the following:
    (i) An acute myocardial infarction.
    (ii) A cardiac arrest.
    (iii) A cerebrovascular accident.

(Authority: 38 U.S.C. 106(d))

[26 FR 1564, Feb. 24, 1961, as amended at 26 FR 6767, July 28, 1961; 27 
FR 4023, Apr. 27, 1962; 29 FR 14171, Oct. 15, 1964; 36 FR 5341, Mar. 20, 
1971; 41 FR 26881, June 29, 1976; 49 FR 47003, Nov. 30, 1984; 54 FR 
51200, Dec. 13, 1989; 55 FR 23931, June 13, 1990; 60 FR 57179, Nov. 14, 
1995; 61 FR 11731, Mar. 22, 1996; 66 FR 48560, Sept. 21, 2001; 67 FR 
49585, July 31, 2002]

[[Page 148]]



Sec. 3.7  Individuals and groups considered to have performed active military, naval, or air service.

    The following individuals and groups are considered to have 
performed active military, naval, or air service:
    (a) Aerial transportation of mail (Pub. L. 140, 73d Congress). 
Persons who were injured or died while serving under conditions set 
forth in Pub. L. 140, 73d Congress.
    (b) Aliens. Effective July 28, 1959, a veteran discharged for 
alienage during a period of hostilities unless evidence affirmatively 
shows he or she was discharged at his or her own request. A veteran who 
was discharged for alienage after a period of hostilities and whose 
service was honest and faithful is not barred from benefits if he or she 
is otherwise entitled. A discharge changed prior to January 7, 1957, to 
honorable by a board established under authority of section 301, Pub. L. 
346, 78th Congress, as amended, or section 207, Pub. L. 601, 79th 
Congress, as amended (now 10 U.S.C. 1552 and 1553), will be considered 
as evidence that the discharge was not at the alien's request. (See 
Sec. 3.12.)


(Authority: 38 U.S.C. 5303(c))

    (c) Army field clerks. Included as enlisted men.
    (d) Army Nurse Corps, Navy Nurse Corps, and female dietetic and 
physical therapy personnel. (1) Army and Navy nurses (female) on active 
service under order of the service department.
    (2) Dietetic and physical therapy (female) personnel, excluding 
students and apprentices, appointed with relative rank on or after 
December 22, 1942, or commissioned on or after June 22, 1944.
    (e) Aviation camps. Students who were enlisted men during World War 
I.
    (f) Cadets and midshipmen. See Sec. 3.6(b)(4).
    (g) Coast and Geodetic Survey, and its successor agencies, the 
Environmental Science Services Administration and the National Oceanic 
and Atmospheric Administration. See Sec. 3.6(b)(3).
    (h) Coast Guard. Active service in Coast Guard on or after January 
29, 1915, while under jurisdiction of the Treasury Department, Navy 
Department, or the Department of Transportation. (See Sec. 3.6 (c) and 
(d) as to temporary members of the Coast Guard Reserves.)
    (i) Contract surgeons. For compensation and dependency and indemnity 
compensation, if the disability or death was the result of disease or 
injury contracted in line of duty during a war period while actually 
performing the duties of assistant surgeon or acting assistant surgeon 
with any military force in the field, or in transit or in hospital.
    (j) Field clerks, Quartermaster Corps. Included as enlisted men.
    (k) Lighthouse service personnel. Transferred to the service and 
jurisdiction of War or Navy Departments by Executive order under the Act 
of August 29, 1916. Effective July 1, 1939, service was consolidated 
with the Coast Guard.
    (l) Male nurses. Persons who were enlisted men of Medical Corps.
    (m) National Guard. Members of the National Guard of the United 
States and Air National Guard of the United States are included as 
Reserves. See Sec. 3.6 (c) and (d) as to training duty performed by 
members of a State National Guard and paragraph (o) of this section as 
to disability suffered after being called into Federal service and 
before enrollment.
    (n) Persons heretofore having a pensionable or compensable status.


(Authority: 38 U.S.C. 1152, 1504)

    (o) Persons ordered to service. (1) Any person who has:
    (i) Applied for enlistment or enrollment in the active military, 
naval, or air service and who is provisionally accepted and directed, or 
ordered, to report to a place for final acceptance into the service, or
    (ii) Been selected or drafted for such service, and has reported 
according to a call from the person's local draft board and before final 
rejection, or
    (iii) Been called into Federal service as a member of the National 
Guard, but has not been enrolled for Federal service, and
    (iv) Suffered injury or disease in line of duty while going to, or 
coming from, or at such place for final acceptance or entry upon active 
duty,

[[Page 149]]


is considered to have been on active duty and therefore to have incurred 
such disability in active service.
    (2) The injury or disease must be due to some factor relating to 
compliance with proper orders. Draftees and selectees are included when 
reporting for preinduction examination or for final induction on active 
duty. Such persons are not included for injury or disease suffered 
during the period of inactive duty, or period of waiting, after a final 
physical examination and prior to beginning the trip to report for 
induction. Members of the National Guard are included when reporting to 
a designated rendezvous.
    (p) Philippine Scouts and others. See Sec. 3.40.
    (q) Public Health Service. See Sec. 3.6 (a) and (b).
    (r) Reserves. See Sec. 3.6 (a), (b), and (c).
    (s) Revenue Cutter Service. While serving under direction of 
Secretary of the Navy in cooperation with the Navy.
    (t) Training camps. Members of training camps authorized by section 
54 of the National Defense Act, except members of Student Army Training 
Corps Camps at the Presidio of San Francisco, Plattsburg, New York, Fort 
Sheridan, Illinois, Howard University, Washington, D.C., Camp Perry, 
Ohio, and Camp Hancock, Georgia, from July 18, 1918, to September 16, 
1918.
    (u) Women's Army Corps (WAC). Service on or after July 1, 1943.
    (v) Women's Reserve of Navy, Marine Corps, and Coast Guard. Same 
benefits as members of the Officers Reserve Corps or enlisted men of the 
United States Navy, Marine Corps or Coast Guard.
    (w) Russian Railway Service Corps. Service during World War I as 
certified by the Secretary of the Army.
    (x) Active military service certified as such under section 401 of 
Pub. L. 95-202. Such service if certified by the Secretary of Defense as 
active military service and if a discharge under honorable conditions is 
issued by the Secretary. The effective dates for an award based upon 
such service shall be as provided by Sec. 3.400(z) and 38 U.S.C. 5110, 
except that in no event shall such an award be made effective earlier 
than November 23, 1977. Service in the following groups has been 
certified as active military service.
    (1) Women's Air Forces Service Pilots (WASP).
    (2) Signal Corps Female Telephone Operators Unit of World War I.
    (3) Engineer Field Clerks (WWI).
    (4) Women's Army Auxiliary Corps (WAAC).
    (5) Quartermaster Corps Female Clerical Employees serving with the 
AEF (American Expeditionary Forces) in World War I.
    (6) Civilian Employees of Pacific Naval Air Bases Who Actively 
Participated in Defense of Wake Island During World War II.
    (7) Reconstruction Aides and Dietitians in World War I.
    (8) Male Civilian Ferry Pilots.
    (9) Wake Island Defenders from Guam.
    (10) Civilian Personnel Assigned to the Secret Intelligence Element 
of the OSS.
    (11) Guam Combat Patrol.
    (12) Quartermaster Corps Keswick Crew on Corregidor (WWII).
    (13) U.S. Civilian Volunteers Who Actively Participated in the 
Defense of Bataan.
    (14) United States Merchant Seamen Who Served on Blockships in 
Support of Operation Mulberry.
    (15) American Merchant Marine in Oceangoing Service during the 
Period of Armed Conflict, December 7, 1941, to August 15, 1945.
    (16) Civilian Navy IFF Technicians Who Served in the Combat Areas of 
the Pacific during World War II (December 7, 1941 to August 15, 1945). 
As used in the official name of this group, the acronym IFF stands for 
Identification Friend or Foe.
    (17) U.S. Civilians of the American Field Service (AFS) Who Served 
Overseas Operationally in World War I during the Period August 31, 1917 
to January 1, 1918.
    (18) U.S. Civilians of the American Field Service (AFS) Who Served 
Overseas Under U.S. Armies and U.S. Army Groups in World War II during 
the Period December 7, 1941 through May 8, 1945.
    (19) U.S. Civilian Employees of American Airlines Who Served 
Overseas as a Result of American Airlines' Contract

[[Page 150]]

with the Air Transport Command During the Period December 14, 1941 
through August 14, 1945.
    (20) Civilian Crewmen of United States Coast and Geodetic Survey 
(USCGS) Vessels Who Performed Their Service in Areas of Immediate 
Military Hazard While Conducting Cooperative Operations with and for the 
United States Armed Forces Within a Time Frame of December 7, 1941, to 
August 15, 1945 on a qualifying USCGS vessel. Qualifying USCGS vessels 
are the Derickson, Explorer, Gilbert, Hilgard, E. Lester Jones, Lydonia, 
Patton, Surveyor, Wainwright, Westdahl, Oceanographer, Hydrographer, and 
Pathfinder.
    (21) Honorably Discharged Members of the American Volunteer Group 
(Flying Tigers) Who Served During the Period December 7, 1941 to July 
18, 1942.
    (22) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of United Air Lines (UAL), Who Served Overseas as a Result of UAL's 
Contract With the Air Transport Command During the Period December 14, 
1941, through August 14, 1945.
    (23) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of Transcontinental and Western Air (TWA), Inc., Who Served Overseas as 
a Result of TWA's Contract with the Air Transport Command During the 
Period December 14, 1941, through August 14, 1945. The ``Flight Crew'' 
includes pursers.
    (24) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of Consolidated Vultree Aircraft Corporation (Consairway Division) Who 
Served Overseas as a Result of a Contract With the Air Transport Command 
During the Period December 14, 1941, through August 14, 1945.
    (25) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of Pan American World Airways and Its Subsidiaries and Affiliates, Who 
Served Overseas as a Result of Pan American's Contract With the Air 
Transport Command and Naval Air Transport Service During the Period 
December 14, 1941 through August 14, 1945.
    (26) Honorably Discharged Members of the American Volunteer Guard, 
Eritrea Service Command During the Period June 21, 1942 to March 31, 
1943.
    (27) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of Northwest Airlines, Who Served Overseas as a Result of Northwest 
Airline's Contract with the Air Transport Command during the Period 
December 14, 1941 through August 14, 1945.
    (28) U.S. Civilian Female Employees of the U.S. Army Nurse Corps 
While Serving in the Defense of Bataan and Corregidor During the Period 
January 2, 1942 to February 3, 1945.
    (29) U.S. Flight Crew and Aviation Ground Support Employees of 
Northeast Airlines Atlantic Division, Who Served Overseas as a Result of 
Northeast Airlines' Contract With the Air Transport Command During the 
Period December 7, 1941, Through August 14, 1945.
    (30) U.S. Civilian Flight Crew and Aviation Ground Support Employees 
of Braniff Airways, Who Served Overseas in the North Atlantic or Under 
the Jurisdiction of the North Atlantic Wing, Air Transport Command 
(ATC), as a Result of a Contract With the ATC During the Period February 
26, 1942, Through August 14, 1945.
    (31) The approximately 50 Chamorro and Carolinian former native 
policemen who received military training in the Donnal area of central 
Saipan and were placed under the command of Lt. Casino of the 6th 
Provisional Military Police Battalion to accompany United States Marines 
on active, combat-patrol activity from August 19, 1945, to September 2, 
1945.
    (32) Three scouts/guides, Miguel Tenorio, Penedicto Taisacan, and 
Cristino Dela Cruz, who assisted the United States Marines in the 
offensive operations against the Japanese on the Northern Mariana 
Islands from June 19, 1944, through September 2, 1945.
    (33) The Operational Analysis Group of the Office of Scientific 
Research and Development, Office of Emergency Management, which served 
overseas with the U.S. Army Air Corps from December 7, 1941, through 
August 15, 1945.


(Authority: Sec. 401, Pub. L. 95-202, 91 Stat. 1449)
    (y) Alaska Territorial Guard: Members of the Alaska Territorial 
Guard during

[[Page 151]]

World War II who were honorably discharged from such service as 
determined by the Secretary of Defense.

Authority:
    38 U.S.C 106(f).

    Cross Reference: Office of Workers' Compensation Programs. See Sec. 
3.708.

[26 FR 1565, Feb. 24, 1961]

    Editorial Note: For Federal Register citations affecting Sec. 3.7, 
see the List of CFR Sections Affected, which appears in the Finding Aids 
section of the printed volume and on GPO Access.



Sec. 3.10  Dependency and indemnity compensation rate for a surviving spouse.

    (a) General determination of rate. When VA grants a surviving spouse 
entitlement to DIC, VA will determine the rate of the benefit it will 
award. The rate of the benefit will be the total of the basic monthly 
rate specified in paragraph (b) or (d) of this section and any 
applicable increases specified in paragraph (c) or (e) of this section.
    (b) Basic monthly rate. Except as provided in paragraph (d) of this 
section, the basic monthly rate of DIC for a surviving spouse will be 
the amount set forth in 38 U.S.C. 1311(a)(1).
    (c) Section 1311(a)(2) increase. The basic monthly rate under 
paragraph (b) of this section shall be increased by the amount specified 
in 38 U.S.C. 1311(a)(2) if the veteran, at the time of death, was 
receiving, or was entitled to receive, compensation for service-
connected disability that was rated by VA as totally disabling for a 
continuous period of at least eight years immediately preceding death. 
Determinations of entitlement to this increase shall be made in 
accordance with paragraph (f) of this section.
    (d) Alternative basic monthly rate for death occurring prior to 
January 1, 1993. The basic monthly rate of DIC for a surviving spouse 
when the death of the veteran occurred prior to January 1, 1993, will be 
the amount specified in 38 U.S.C. 1311(a)(3) corresponding to the 
veteran's pay grade in service, but only if such rate is greater than 
the total of the basic monthly rate and the section 1311(a)(2) increase 
(if applicable) the surviving spouse is entitled to receive under 
paragraphs (b) and (c) of this section. The Secretary of the concerned 
service department will certify the veteran's pay grade and the 
certification will be binding on VA. DIC paid pursuant to this paragraph 
may not be increased by the section 1311(a)(2) increase under paragraph 
(c) of this section.
    (e) Additional increases. One or more of the following increases may 
be paid in addition to the basic monthly rate and the section 1311(a)(2) 
increase.
    (1) Increase for children. If the surviving spouse has one or more 
children under the age of 18 of the deceased veteran (including a child 
not in the surviving spouse's actual or constructive custody, or a child 
who is in active military service), the monthly DIC rate will be 
increased by the amount set forth in 38 U.S.C. 1311(b) for each child.
    (2) Increase for regular aid and attendance. If the surviving spouse 
is determined to be in need of regular aid and attendance under the 
criteria in Sec. 3.352 or is a patient in a nursing home, the monthly 
DIC rate will be increased by the amount set forth in 38 U.S.C. 1311(c).
    (3) Increase for housebound status. If the surviving spouse does not 
qualify for the regular aid and attendance allowance but is housebound 
under the criteria in Sec. 3.351(f), the monthly DIC rate will be 
increased by the amount set forth in 38 U.S.C. 1311(d).
    (4) For a two-year period beginning on the date entitlement to 
dependency and indemnity compensation commenced, the dependency and 
indemnity compensation paid monthly to a surviving spouse with one or 
more children below the age of 18 shall be increased by the amount set 
forth in 38 U.S.C. 1311(e), regardless of the number of such children. 
The dependency and indemnity compensation payable under this paragraph 
is in addition to any other dependency and indemnity compensation 
payable. The increase in dependency and indemnity compensation of a 
surviving spouse under this paragraph shall cease beginning with the 
first month commencing after the month in which all children of the 
surviving spouse have attained the age of 18.


(Authority: 38 U.S.C. 1311(e))


[[Page 152]]


    (f) Criteria governing section 1311(a)(2) increase. In determining 
whether a surviving spouse qualifies for the section 1311(a)(2) increase 
under paragraph (c) of this section, the following standards shall 
apply.
    (1) Marriage requirement. The surviving spouse must have been 
married to the veteran for the entire eight-year period referenced in 
paragraph (c) of this section in order to qualify for the section 
1311(a)(2) increase.
    (2) Determination of total disability. As used in paragraph (c) of 
this section, the phrase ``rated by VA as totally disabling'' includes 
total disability ratings based on unemployability (Sec. 4.16 of this 
chapter).
    (3) Definition of ``entitled to receive''. As used in paragraph (c) 
of this section, the phrase ``entitled to receive'' means that the 
veteran filed a claim for disability compensation during his or her 
lifetime and one of the following circumstances is satisfied:
    (i) The veteran would have received total disability compensation 
for the period specified in paragraph (c) of this section but for clear 
and unmistakable error committed by VA in a decision on a claim filed 
during the veteran's lifetime; or
    (ii) Additional evidence submitted to VA before or after the 
veteran's death, consisting solely of service department records that 
existed at the time of a prior VA decision but were not previously 
considered by VA, provides a basis for reopening a claim finally decided 
during the veteran's lifetime and for awarding a total service-connected 
disability rating retroactively in accordance with Sec. Sec. 3.156(c) 
and 3.400(q)(2) of this part for the period specified in paragraph (c) 
of this section; or
    (iii) At the time of death, the veteran had a service-connected 
disability that was continuously rated totally disabling by VA for the 
period specified in paragraph (c) of this section, but was not receiving 
compensation because:
    (A) VA was paying the compensation to the veteran's dependents;
    (B) VA was withholding the compensation under the authority of 38 
U.S.C. 5314 to offset an indebtedness of the veteran;
    (C) The veteran had not waived retired or retirement pay in order to 
receive compensation;
    (D) VA was withholding payments under the provisions of 10 U.S.C. 
1174(h)(2);
    (E) VA was withholding payments because the veteran's whereabouts 
were unknown, but the veteran was otherwise entitled to continued 
payments based on a total service-connected disability rating; or
    (F) VA was withholding payments under 38 U.S.C. 5308 but determines 
that benefits were payable under 38 U.S.C. 5309.

(Authority: 38 U.S.C. 501(a), 1311, 1314, and 1321)

[70 FR 72220, Dec. 2, 2005, as amended at 71 FR 44918, Aug. 8, 2006]



Sec. 3.11  Homicide.

    Any person who has intentionally and wrongfully caused the death of 
another person is not entitled to pension, compensation, or dependency 
and indemnity compensation or increased pension, compensation, or 
dependency and indemnity compensation by reason of such death. For the 
purpose of this section the term dependency and indemnity compensation 
includes benefits at dependency and indemnity compensation rates paid 
under 38 U.S.C. 1318.

[44 FR 22718, Apr. 17, 1979, as amended at 54 FR 31829, Aug. 2, 1989]



Sec. 3.12  Character of discharge.

    (a) If the former service member did not die in service, pension, 
compensation, or dependency and indemnity compensation is not payable 
unless the period of service on which the claim is based was terminated 
by discharge or release under conditions other than dishonorable. (38 
U.S.C. 101(2)). A discharge under honorable conditions is binding on the 
Department of Veterans Affairs as to character of discharge.
    (b) A discharge or release from service under one of the conditions 
specified in this section is a bar to the payment of benefits unless it 
is found that the person was insane at the time of committing the 
offense causing such discharge or release or unless otherwise 
specifically provided (38 U.S.C. 5303(b)).

[[Page 153]]

    (c) Benefits are not payable where the former service member was 
discharged or released under one of the following conditions:
    (1) As a conscientious objector who refused to perform military 
duty, wear the uniform, or comply with lawful order of competent 
military authorities.
    (2) By reason of the sentence of a general court-martial.
    (3) Resignation by an officer for the good of the service.
    (4) As a deserter.
    (5) As an alien during a period of hostilities, where it is 
affirmatively shown that the former service member requested his or her 
release. See Sec. 3.7(b).
    (6) By reason of a discharge under other than honorable conditions 
issued as a result of an absence without official leave (AWOL) for a 
continuous period of at least 180 days. This bar to benefit entitlement 
does not apply if there are compelling circumstances to warrant the 
prolonged unauthorized absence. This bar applies to any person awarded 
an honorable or general discharge prior to October 8, 1977, under one of 
the programs listed in paragraph (h) of this section, and to any person 
who prior to October 8, 1977, had not otherwise established basic 
eligibility to receive Department of Veterans Affairs benefits. The term 
established basic eligibility to receive Department of Veterans Affairs 
benefits means either a Department of Veterans Affairs determination 
that an other than honorable discharge was issued under conditions other 
than dishonorable, or an upgraded honorable or general discharge issued 
prior to October 8, 1977, under criteria other than those prescribed by 
one of the programs listed in paragraph (h) of this section. However, if 
a person was discharged or released by reason of the sentence of a 
general court-martial, only a finding of insanity (paragraph (b) of this 
section) or a decision of a board of correction of records established 
under 10 U.S.C. 1552 can estalish basic eligibility to receive 
Department of Veterans Affairs benefits. The following factors will be 
considered in determining whether there are compelling circumstances to 
warrant the prolonged unauthorized absence.
    (i) Length and character of service exclusive of the period of 
prolonged AWOL. Service exclusive of the period of prolonged AWOL should 
generally be of such quality and length that it can be characterized as 
honest, faithful and meritorious and of benefit to the Nation.
    (ii) Reasons for going AWOL. Reasons which are entitled to be given 
consideration when offered by the claimant include family emergencies or 
obligations, or similar types of obligations or duties owed to third 
parties. The reasons for going AWOL should be evaluated in terms of the 
person's age, cultural background, educational level and judgmental 
maturity. Consideration should be given to how the situation appeared to 
the person himself or herself, and not how the adjudicator might have 
reacted. Hardship or suffering incurred during overseas service, or as a 
result of combat wounds of other service-incurred or aggravated 
disability, is to be carefully and sympathetically considered in 
evaluating the person's state of mind at the time the prolonged AWOL 
period began.
    (iii) A valid legal defense exists for the absence which would have 
precluded a conviction for AWOL. Compelling circumstances could occur as 
a matter of law if the absence could not validly be charged as, or lead 
to a conviction of, an offense under the Uniform Code of Military 
Justice. For purposes of this paragraph the defense must go directly to 
the substantive issue of absence rather than to procedures, 
technicalities or formalities.
    (d) A discharge or release because of one of the offenses specified 
in this paragraph is considered to have been issued under dishonorable 
conditions.
    (1) Acceptance of an undesirable discharge to escape trial by 
general court-martial.
    (2) Mutiny or spying.
    (3) An offense involving moral turpitude. This includes, generally, 
conviction of a felony.
    (4) Willful and persistent misconduct. This includes a discharge 
under other than honorable conditions, if it is determined that it was 
issued because of willful and persistent misconduct. A discharge because 
of a minor offense will not, however, be considered willful

[[Page 154]]

and persistent misconduct if service was otherwise honest, faithful and 
meritorious.
    (5) Homosexual acts involving aggravating circumstances or other 
factors affecting the performance of duty. Examples of homosexual acts 
involving aggravating circumstances or other factors affecting the 
performance of duty include child molestation, homosexual prostitution, 
homosexual acts or conduct accompanied by assault or coercion, and 
homosexual acts or conduct taking place between service members of 
disparate rank, grade, or status when a service member has taken 
advantage of his or her superior rank, grade, or status.
    (e) An honorable discharge or discharge under honorable conditions 
issued through a board for correction of records established under 
authority of 10 U.S.C. 1552 is final and conclusive on the Department of 
Veterans Affairs. The action of the board sets aside any prior bar to 
benefits imposed under paragraph (c) or (d) of this section.
    (f) An honorable or general discharge issued prior to October 8, 
1977, under authority other than that listed in paragraphs (h) (1), (2) 
and (3) of this section by a discharge review board established under 10 
U.S.C. 1553 set aside any bar to benefits imposed under paragraph (c) or 
(d) of this section except the bar contained in paragraph (c)(2) of this 
section.
    (g) An honorable or general discharge issued on or after October 8, 
1977, by a discharge review board established under 10 U.S.C. 1553, sets 
aside a bar to benefits imposed under paragraph (d), but not paragraph 
(c), of this section provided that:
    (1) The discharge is upgraded as a result of an individual case 
review;
    (2) The discharge is upgraded under uniform published standards and 
procedures that generally apply to all persons administratively 
discharged or released from active military, naval or air service under 
conditions other than honorable; and
    (3) Such standards are consistent with historical standards for 
determining honorable service and do not contain any provision for 
automatically granting or denying an upgraded discharge.
    (h) Unless a discharge review board established under 10 U.S.C. 1553 
determines on an individual case basis that the discharge would be 
upgraded under uniform standards meeting the requirements set forth in 
paragraph (g) of this section, an honorable or general discharge awarded 
under one of the following programs does not remove any bar to benefits 
imposed under this section:
    (1) The President's directive of January 19, 1977, implementing 
Presidential Proclamation 4313 of September 16, 1974; or
    (2) The Department of Defense's special discharge review program 
effective April 5, 1977; or
    (3) Any discharge review program implemented after April 5, 1977, 
that does not apply to all persons administratively discharged or 
released from active military service under other than honorable 
conditions.


(Authority: 38 U.S.C. 5303 (e))

    (i) No overpayments shall be created as a result of payments made 
after October 8, 1977, based on an upgraded honorable or general 
discharge issued under one of the programs listed in paragraph (h) of 
this section which would not be awarded under the standards set forth in 
paragraph (g) of this section. Accounts in payment status on or after 
October 8, 1977, shall be terminated the end of the month in which it is 
determined that the original other than honorable discharge was not 
issued under conditions other than dishonorable following notice from 
the appropriate discharge review board that the discharge would not have 
been upgraded under the standards set forth in paragraph (g) of this 
section, or April 7, 1978, whichever is the earliest. Accounts in 
suspense (either before or after October 8, 1977) shall be terminated on 
the date of last payment or April 7, 1978, whichever is the earliest.
    (j) No overpayment shall be created as a result of payments made 
after October 8, 1977, in cases in which the bar contained in paragraph 
(c)(6) of this section is for application. Accounts in payment status on 
or after October 8, 1977, shall be terminated at the end of the month in 
which it is determined that compelling circumstances do not

[[Page 155]]

exist, or April 7, 1978, whichever is the earliest. Accounts in suspense 
(either before or after October 8, 1977) shall be terminated on the date 
of last payment, or April 7, 1978, whichever is the earliest.
    (k) Uncharacterized separations. Where enlisted personnel are 
administratively separated from service on the basis of proceedings 
initiated on or after October 1, 1982, the separation may be classified 
as one of the three categories of administrative separation that do not 
require characterization of service by the military department 
concerned. In such cases conditions of discharge will be determined by 
the VA as follows:
    (1) Entry level separation. Uncharacterized administrative 
separations of this type shall be considered under conditions other than 
dishonorable.
    (2) Void enlistment or induction. Uncharacterized administrative 
separations of this type shall be reviewed based on facts and 
circumstances surrounding separation, with reference to the provisions 
of Sec. 3.14 of this part, to determine whether separation was under 
conditions other than dishonorable.
    (3) Dropped from the rolls. Uncharacterized administrative 
separations of this type shall be reviewed based on facts and 
circumstances surrounding separation to determine whether separation was 
under conditions other than dishonorable.

(Authority: 38 U.S.C. 501)

    Cross References: Validity of enlistments. See Sec. 3.14. Revision 
of decisions. See Sec. 3.105. Effective dates. See Sec. 3.400(g). 
Minimum active-duty service requirement. See Sec. 3.12a.

[28 FR 123, Jan. 4, 1963, as amended at 41 FR 12656, Mar. 26, 1976; 43 
FR 15153, Apr. 11, 1978; 45 FR 2318, Jan. 11, 1980; 49 FR 44099, Nov. 2, 
1984; 62 FR 14823, Mar. 28, 1997]



Sec. 3.12a  Minimum active-duty service requirement.

    (a) Definitions. (1) The term minimum period of active duty means, 
for the purposes of this section, the shorter of the following periods.
    (i) Twenty-four months of continuous active duty. Non-duty periods 
that are excludable in determining the Department of Veterans Affairs 
benefit entitlement (e.g., see Sec. 3.15) are not considered as a break 
in service for continuity purposes but are to be subtracted from total 
time served.
    (ii) The full period for which a person was called or ordered to 
active duty.
    (2) The term benefit includes a right or privilege but does not 
include a refund of a participant's contributions under 38 U.S.C. Ch. 
32.
    (b) Effect on Department of Veterans Affairs benefits. Except as 
provided in paragraph (d) of this section, a person listed in paragraph 
(c) of this section who does not complete a minimum period of active 
duty is not eligible for any benefit under title 38, United States Code 
or under any law administered by the Department of Veterans Affairs 
based on that period of active service.
    (c) Persons included. Except as provided in paragraph (d) of this 
section, the provisions of paragraph (b) of this section apply to the 
following persons:
    (1) A person who originally enlists (enlisted person only) in a 
regular component of the Armed Forces after September 7, 1980 (a person 
who signed a delayed-entry contract with one of the service branches 
prior to September 8, 1980, and under that contract was assigned to a 
reserve component until entering on active duty after September 7, 1980, 
shall be considered to have enlisted on the date the person entered on 
active duty); and
    (2) Any other person (officer as well as enlisted) who enters on 
active duty after October 16, 1981 and who has not previously completed 
a continuous period of active duty of at least 24 months or been 
discharged or released from active duty under 10 U.S.C. 1171 (early 
out).
    (d) Exclusions. The provisions of paragraph (b) of this section are 
not applicable to the following cases:
    (1) To a person who is discharged or released under 10 U.S.C. 1171 
or 1173 (early out or hardship discharge).
    (2) To a person who is discharged or released from active duty for a 
disability adjudged service connected without presumptive provisions of 
law, or who at time of discharge had such a service-connected 
disability, shown by

[[Page 156]]

official service records, which in medical judgment would have justified 
a discharge for disability.
    (3) To a person with a compensable service-connected disability.
    (4) To the provision of a benefit for or in connection with a 
service-connected disability, condition, or death.
    (5) To benefits under chapter 19 of title 38, United States Code.
    (e) Dependent or survivor benefits--(1) General. If a person is, by 
reason of this section, barred from receiving any benefits under title 
38, United States Code (or under any other law administered by the 
Department of Veterans Affairs based on a period of active duty, the 
person's dependents or survivors are also barred from receiving benefits 
based on the same period of active duty.
    (2) Exceptions. Paragraph (e)(1) of this section does not apply to 
benefits under chapters 19 and 37 of title 38, United States Code. (38 
U.S.C. 5303A)

[47 FR 24549, June 7, 1982]



Sec. 3.13  Discharge to change status.

    (a) A discharge to accept appointment as a commissioned or warrant 
officer, or to change from a Reserve or Regular commission to accept a 
commission in the other component, or to reenlist is a conditional 
discharge if it was issued during one of the following periods:
    (1) World War I; prior to November 11, 1918. As to reenlistments, 
this subparagraph applies only to Army and National Guard. No 
involuntary extension or other restrictions existed on Navy enlistments.
    (2) World War II, the Korean conflict or the Vietnam era; prior to 
the date the person was eligible for discharge under the point or length 
of service system, or under any other criteria in effect.
    (3) Peacetime service; prior to the date the person was eligible for 
an unconditional discharge.
    (b) Except as provided in paragraph (c) of this section, the entire 
period of service under the circumstances stated in paragraph (a) of 
this section constitutes one period of service and entitlement will be 
determined by the character of the final termination of such period of 
active service except that, for death pension purposes, Sec. 3.3(b)(3) 
and (4) is controlling as to basic entitlement when the conditions 
prescribed therein are met.
    (c) Despite the fact that no unconditional discharge may have been 
issued, a person shall be considered to have been unconditionally 
discharged or released from active military, naval or air service when 
the following conditions are met:
    (1) The person served in the active military, naval or air service 
for the period of time the person was obligated to serve at the time of 
entry into service;
    (2) The person was not discharged or released from such service at 
the time of completing that period of obligation due to an intervening 
enlistment or reenlistment; and
    (3) The person would have been eligible for a discharge or release 
under conditions other than dishonorable at that time except for the 
intervening enlistment or reenlistment.

[26 FR 1566, Feb. 24, 1961, as amended at 27 FR 4024, Apr. 27, 1962; 32 
FR 13224, Sept. 19, 1967; 43 FR 15154, Apr. 11, 1978; 46 FR 23926, Apr. 
29, 1981]



Sec. 3.14  Validity of enlistments.

    Service is valid unless the enlistment is voided by the service 
department.
    (a) Enlistment not prohibited by statute. Where an enlistment is 
voided by the service department for reasons other than those stated in 
paragraph (b) of this section, service is valid from the date of entry 
upon active duty to the date of voidance by the service department. 
Benefits may not be paid, however, unless the discharge is held to have 
been under conditions other than dishonorable. Generally discharge for 
concealment of a physical or mental defect except incompetency or 
insanity which would have prevented enlistment will be held to be under 
dishonorable conditions.
    (b) Statutory prohibition. Where an enlistment is voided by the 
service department because the person did not have legal capacity to 
contract for a reason other than minority (as in the case of an insane 
person) or because the enlistment was prohibited by statute (a deserter 
or person convicted of a felony), benefits may not be paid based

[[Page 157]]

on that service even though a disability was incurred during such 
service. An undesirable discharge by reason of the fraudulent enlistment 
voids the enlistment from the beginning.
    (c) Misrepresentation of age. Active service which was terminated 
because of concealment of minority or misrepresentation of age is 
honorable if the veteran was released from service under conditions 
other than dishonorable. Service is valid from the date of entry upon 
active duty to the date of discharge.
    (d) Honorable discharges. Determinations as to honorable service 
will be made by the service departments and the finding shall be binding 
on the Department of Veterans Affairs, but, in the case of an alien, the 
effect of the discharge will be governed by Sec. 3.7(b).

[26 FR 1567, Feb. 24, 1961, as amended at 27 FR 4024, Apr. 27, 1962]



Sec. 3.15  Computation of service.

    For nonservice-connected or service-connected benefits, active 
service is countable exclusive of time spent on an industrial, 
agricultural, or indefinite furlough, time lost on absence without leave 
(without pay), under arrest (without acquittal), in desertion, while 
undergoing sentence of court-martial or a period following release from 
active duty under the circumstances outlined in Sec. 3.41. In claims 
based on Spanish-American War service, leave authorized under General 
Order No. 130, War Department, is included.

    Cross Reference: Duty periods. See Sec. 3.6(b)(6).

[40 FR 16064, Apr. 9, 1975]



Sec. 3.16  Service pension.

    In computing the 70 or 90 days required under Sec. 3.3(a) active 
service which began before or extended beyond the war period will be 
included if such service was continuous. Broken periods of service 
during a war period may be added together to meet the requirement for 
length of service.

[41 FR 18299, May 3, 1976, as amended at 44 FR 45932, Aug. 6, 1979]



Sec. 3.17  Disability and death pension; Mexican border period and later war periods.

    In computing the 90 days' service required for pension entitlement 
(see Sec. 3.3), there will be included active service which began 
before and extended into the Mexican border period or ended during World 
War I, or began or ended during World War II, the Korean conflict, the 
Vietnam era or the Persian Gulf War, if such service was continuous. 
Service during different war periods may be combined with service during 
any other war period to meet the 90 days' service requirement.

(Authority: 38 U.S.C. 1521)

[37 FR 6676, Apr. 1, 1972, as amended at 44 FR 45932, Aug. 6, 1979; 56 
FR 57986, Nov. 15, 1991]



Sec. Sec. 3.18-3.19  [Reserved]



Sec. 3.20  Surviving spouse's benefit for month of veteran's death.

    (a) Where the veteran died on or after December 1, 1962, and before 
October 1, 1982, the rate of death pension or dependency and indemnity 
compensation otherwise payable for the surviving spouse for the month in 
which the death occurred shall be not less than the amount of pension or 
compensation which would have been payable to or for the veteran for 
that month but for his or her death.


(Authority: 38 U.S.C. 5310)

    (b) Where the veteran dies on or after October 1, 1982, the 
surviving spouse may be paid death pension or dependency and indemnity 
compensation for the month in which the veteran died at a rate equal to 
the amount of compensation or pension which would have been payable to 
the veteran for that month had death not occurred, but only if such rate 
is equal to or greater than the monthly rate of death pension or 
dependency and indemnity compensation to which the surviving spouse is 
entitled. Otherwise, no payment of death pension or dependency and 
indemnity compensation may be made for the month in which the veteran 
died.


(Authority: 38 U.S.C. 5111(c))


[[Page 158]]


    (c)(1) Where a veteran receiving compensation or pension dies after 
December 31, 1996, the surviving spouse, if not entitled to death 
compensation, dependency and indemnity compensation, or death pension 
for the month of death, shall be entitled to a benefit for that month in 
an amount equal to the amount of compensation or pension the veteran 
would have received for that month but for his or her death.
    (2) A payment issued to a deceased veteran as compensation or 
pension for the month in which death occurred shall be treated as 
payable to that veteran's surviving spouse, if the surviving spouse is 
not entitled to death compensation, dependency and indemnity 
compensation or death pension for that month and, if negotiated or 
deposited, shall be considered to be the benefit to which the surviving 
spouse is entitled under paragraph (c)(1) of this section. However, if 
such payment is in an amount less than the amount of the benefit under 
paragraph (c)(1) of this section, the unpaid difference shall be treated 
in the same manner as an accrued benefit under Sec. 3.1000 of this 
part.

(Authority: 38 U.S.C. 5310(b))

[48 FR 34471, July 29, 1983, as amended at 62 FR 35422, July 1, 1997; 64 
FR 30392, June 8, 1999]



Sec. 3.21  Monetary rates.

    The rates of compensation, dependency and indemnity compensation for 
surviving spouses and children, and section 306 and old-law disability 
and death pension, are published in tabular form in appendix B of the 
Veterans Benefits Administration Manual M21-1 and are to be given the 
same force and effect as if published in the regulations (title 38, Code 
of Federal Regulations). The maximum annual rates of improved pension 
payable under Pub. L. 95-588 (92 Stat. 2497) are set forth in Sec. Sec. 
3.23 and 3.24. The monthly rates and annual income limitations 
applicable to parents' dependency and indemnity compensation are set 
forth in Sec. 3.25.

    Cross References: Section 306 pension. See Sec. 3.1(u). Old-law 
pension. See Sec. 3.1(v). Improved pension. See Sec. 3.1(w).

[44 FR 45932, Aug. 6, 1979]



Sec. 3.22  DIC benefits for survivors of certain veterans rated totally disabled at time of death.

    (a) Even though a veteran died of non-service-connected causes, VA 
will pay death benefits to the surviving spouse or children in the same 
manner as if the veteran's death were service-connected, if:
    (1) The veteran's death was not the result of his or her own willful 
misconduct, and
    (2) At the time of death, the veteran was receiving, or was entitled 
to receive, compensation for service-connected disability that was:
    (i) Rated by VA as totally disabling for a continuous period of at 
least 10 years immediately preceding death;
    (ii) Rated by VA as totally disabling continuously since the 
veteran's release from active duty and for at least 5 years immediately 
preceding death; or
    (iii) Rated by VA as totally disabling for a continuous period of 
not less than one year immediately preceding death, if the veteran was a 
former prisoner of war who died after September 30, 1999.


(Authority: 38 U.S.C. 1318(b))

    (b) For purposes of this section, ``entitled to receive'' means that 
the veteran filed a claim for disability compensation during his or her 
lifetime and one of the following circumstances is satisfied:
    (1) The veteran would have received total disability compensation at 
the time of death for a service-connected disability rated totally 
disabling for the period specified in paragraph (a)(2) of this section 
but for clear and unmistakable error committed by VA in a decision on a 
claim filed during the veteran's lifetime; or
    (2) Additional evidence submitted to VA before or after the 
veteran's death, consisting solely of service department records that 
existed at the time of a prior VA decision but were not previously 
considered by VA, provides a basis for reopening a claim finally decided 
during the veteran's lifetime and for awarding a total service-connected 
disability rating retroactively in accordance with Sec. Sec. 3.156(c) 
and 3.400(q)(2) of this part for the relevant period

[[Page 159]]

specified in paragraph (a)(2) of this section; or
    (3) At the time of death, the veteran had a service-connected 
disability that was continuously rated totally disabling by VA for the 
period specified in paragraph (a)(2), but was not receiving compensation 
because:
    (i) VA was paying the compensation to the veteran's dependents;
    (ii) VA was withholding the compensation under authority of 38 
U.S.C. 5314 to offset an indebtedness of the veteran;
    (iii) The veteran had not waived retired or retirement pay in order 
to receive compensation;
    (iv) VA was withholding payments under the provisions of 10 U.S.C. 
1174(h)(2);
    (v) VA was withholding payments because the veteran's whereabouts 
were unknown, but the veteran was otherwise entitled to continued 
payments based on a total service-connected disability rating; or
    (vi) VA was withholding payments under 38 U.S.C. 5308 but determines 
that benefits were payable under 38 U.S.C. 5309.
    (c) For purposes of this section, ``rated by VA as totally 
disabling'' includes total disability ratings based on unemployability 
(Sec. 4.16 of this chapter).
    (d) To be entitled to benefits under this section, a surviving 
spouse must have been married to the veteran--
    (1) For at least 1 year immediately preceding the date of the 
veteran's death; or
    (2) For any period of time if a child was born of the marriage, or 
was born to them before the marriage.


(Authority: 38 U.S.C. 1318)

    (e) Effect of judgment or settlement. If a surviving spouse or child 
eligible for benefits under paragraph (a) of this section receives any 
money or property pursuant to a judicial proceeding based upon, or a 
settlement or compromise of, any cause of action or other right of 
recovery for damages for the death of the veteran, benefits payable 
under paragraph (a) of this section shall not be paid for any month 
following the month in which such money or property is received until 
the amount of benefits that would otherwise have been payable under 
paragraph (a) of this section equals the total of the amount of money 
received and the fair market value of the property received. The 
provisions of this paragraph do not apply, however, to any portion of 
such benefits payable for any period preceding the end of the month in 
which such money or property of value is received.


(Authority: 38 U.S.C. 501)

    (f) Social security and worker's compensation. Benefits received 
under social security or worker's compensation are not subject to 
recoupment under paragraph (e) of this section even though such benefits 
may have been awarded pursuant to a judicial proceeding.
    (g) Beneficiary's duty to report. Any person entitled to benefits 
under paragraph (a) of this section shall promptly report to the 
Department of Veterans Affairs the receipt of any money or property 
received pursuant to a judicial proceeding based upon, or a settlement 
or compromise of, any cause of action or other right of recovery for 
damages for the death of the veteran. The amount to be reported is the 
total of the amount of money received and the fair market value of 
property received. Expenses incident to recovery, such as attorney's 
fees, may not be deducted from the amount to be reported.
    (h) Relationship to survivor benefit plan. For the purpose of 10 
U.S.C. 1448(d) and 1450(c) eligibility for benefits under paragraph (a) 
of this section shall be deemed eligibility for dependency and indemnity 
compensation under 38 U.S.C. 1311(a).

(Authority: 38 U.S.C. 1318)

    Cross References: Marriage dates. See Sec. 3.54. Homicide. See 
Sec. 3.11.

[44 FR 22718, Apr. 17, 1979, as amended at 48 FR 41161, Sept. 14, 1983; 
53 FR 23235, June 21, 1988; 54 FR 31829, Aug. 2, 1989; 65 FR 3391, Jan. 
21, 2000; 65 FR 43699, July 14, 2000; 70 FR 72220, Dec. 2, 2005]



Sec. 3.23  Improved pension rates--Veterans and surviving spouses.

    (a) Maximum annual rates of improved pension. The maximum annual 
rates of improved pension for the following categories of beneficiaries 
shall be the

[[Page 160]]

amounts specified in 38 U.S.C. 1521 and 1542, as increased from time to 
time under 38 U.S.C. 5312. Each time there is an increase under 38 
U.S.C. 5312, the actual rates will be published in the ``Notices'' 
section of the Federal Register. (1) Veterans who are permanently and 
totally disabled.


(Authority: 38 U.S.C. 1521(b) or (c))

    (2) Veterans in need of aid and attendance.


(Authority: 38 U.S.C. 1521(d))

    (3) Veterans who are housebound.


(Authority: 38 U.S.C. 1521(e))

    (4) Two veterans married to one another; combined rates.


(Authority: 38 U.S.C. 1521(f))

    (5) Surviving spouse alone or with a child or children of the 
deceased veteran in custody of the surviving spouse.


(Authority: 38 U.S.C. 1541(b) or (c))

    (6) Surviving spouses in need of aid and attendance.


(Authority: 38 U.S.C. 1541(d))

    (7) Surviving spouses who are housebound.


(Authority: 38 U.S.C. 1541(e))

    (b) Reduction for income. The maximum rates of improved pension in 
paragraph (a) of this section shall be reduced by the amount of the 
countable annual income of the veteran or surviving spouse.


(Authority: 38 U.S.C. 1521, 1541)

    (c) Mexican border period and World War I veterans. The applicable 
maximum annual rate payable to a Mexican border period or World War I 
veteran under this section shall be increased by the amount specified in 
38 U.S.C. 1521(g), as increased from time to time under 38 U.S.C 5312. 
Each time there is an increase under 38 U.S.C. 5312, the actual rate 
will be published in the ``Notices'' section of the Federal Register.


(Authority: 38 U.S.C. 1521(g))

    (d) Definitions of terms used in this section--(1) Dependent. A 
veteran's spouse or child. A veteran's spouse who resides apart from the 
veteran and is estranged from the veteran may not be considered the 
veteran's dependent unless the spouse receives reasonable support 
contributions from the veteran. (Note that under Sec. 3.60 a veteran 
and spouse who reside apart are considered to be living together unless 
they are estranged.) A child of a veteran not in custody of the veteran 
and to whose support the veteran is not reasonably contributing, may not 
be considered the veteran's dependent.


(Authority: 38 U.S.C. 1521(b))

    (2) In need of aid and attendance. As defined in Sec. 3.351(b).
    (3) Housebound. As defined in Sec. 3.351(d)(2), (f). This term also 
includes a veteran who has a disability or disabilities evaluated as 60 
percent or more disabling in addition to a permanent and totally 
disabling condition. See Sec. 3.351(d)(1).
    (4) Veteran's annual income. This term includes the veteran's annual 
income, the annual income of the veteran's dependent spouse, and the 
annual income of each child of the veteran (other than a child for whom 
increased pension is not payable under 38 U.S.C. 1522(b)) in the 
veteran's custody or to whose support the veteran is reasonably 
contributing (to the extent such child's income is reasonably available 
to or for the veteran, unless in the judgment of the Department of 
Veterans Affairs to do so would work a hardship on the veteran.) There 
is a rebuttable presumption that all of such a child's income is 
reasonably available to or for the veteran.


(Authority: 38 U.S.C. 1521 (c), (h))

    (5) Surviving spouse's annual income. This term includes the 
surviving spouse's annual income and the annual income of each child of 
the veteran (other than a child for whom increased pension is not 
payable under 38 U.S.C. 1543(a)(2)) in the custody of the surviving 
spouse to the extent that such child's income is reasonably available to 
or for the surviving spouse, unless in the judgment of the Department of 
Veterans Affairs to do so would work a

[[Page 161]]

hardship on the surviving spouse. There is a rebuttable presumption that 
all of such a child's income is available to or for the surviving 
spouse.


(Authority: 38 U.S.C. 1541(c), (g))

    (6) Reasonable availability and hardship. For the purposes of 
paragraphs (d)(4) and (d)(5) of this section, a child's income shall be 
considered ``reasonably available'' when it can be readily applied to 
meet the veteran's or surviving spouse's expenses necessary for 
reasonable family maintenance, and ``hardship'' shall be held to exist 
when annual expenses necessary for reasonable family maintenance exceed 
the sum of countable annual income plus VA pension entitlement. Expenses 
necessary for reasonable family maintenance include expenses for basic 
necessities (such as food, clothing, shelter, etc.) and other expenses, 
determined on a case-by-case basis, which are necessary to support a 
reasonable quality of life.

(Authority: 38 U.S.C. 501)

    Cross References: Improved pension. See Sec. 3.1(w). Child. See 
Sec. 3.57(d). Definition of living with. See Sec. 3.60. Exclusions 
from income. See Sec. 3.272.

[44 FR 45933, Aug. 6, 1979, as amended at 52 FR 34907, Sept. 14, 1987; 
53 FR 23235, June 21, 1988]



Sec. 3.24  Improved pension rates--Surviving children.

    (a) General. The provisions of this section apply to children of a 
deceased veteran not in the custody of a surviving spouse who has basic 
eligibility to receive improved pension. Children in custody of a 
surviving spouse who has basic eligibility to receive improved pension 
do not have separate entitlement. Basic eligibility to receive improved 
pension means that the surviving spouse is in receipt of improved 
pension or could become entitled to receive improved pension except for 
the amount of the surviving spouse's countable annual income or the size 
of the surviving spouse's estate (See Sec. 3.274(c)). Under Sec. 
3.23(d)(5) the countable annual income of a surviving spouse includes 
the countable annual income of each child of the veteran in custody of 
the surviving spouse to the extent the child's income is reasonably 
available to or for the surviving spouse, unless in the judgment of the 
Department of Veterans Affairs to do so would work a hardship on the 
surviving spouse.
    (b) Child with no personal custodian or in the custody of an 
institution. In cases in which there is no personal custodian, i.e., 
there is no person who has the legal right to exercise parental control 
and responsibility for the child's welfare (See Sec. 3.57(d)), or the 
child is in the custody of an institution, pension shall be paid to the 
child at the annual rate specified in 38 U.S.C. 1542, as increased from 
time to time under 38 U.S.C. 5312, reduced by the amount of the child's 
countable annual income. Each time there is an increase under 38 U.S.C. 
5312, the actual rate will be published in the ``Notices'' section of 
the Federal Register.
    (c) Child in the custody of person legally responsible for support--
(1) Single child. Pension shall be paid to a child in the custody of a 
person legally responsible for the child's support at an annual rate 
equal to the difference between the rate for a surviving spouse and one 
child under Sec. 3.23(a)(5), and the sum of the annual income of such 
child and the annual income of such person or, the maximum annual 
pension rate under paragraph (b) of this section, whichever is less.
    (2) More than one child. Pension shall be paid to children in 
custody of a person legally responsible for the children's support at an 
annual rate equal to the difference between the rate for a surviving 
spouse and an equivalent number of children (but not including any child 
who has countable annual income equal to or greater than the maximum 
annual pension rate under paragraph (b) of this section) and the sum of 
the countable annual income of the person legally responsible for 
support and the combined countable annual income of the children (but 
not including the income of any child whose countable annual income is 
equal to or greater than the maximum annual pension rate under paragraph 
(b) of this section, or the maximum annual pension rate under paragraph 
(b) of this section times the number of eligible children, whichever is 
less).

(Authority: 38 U.S.C. 1542)

[[Page 162]]


    Cross References: Child. See Sec. 3.57(d). Exclusions from income. 
See Sec. 3.272.

[44 FR 45933, Aug. 6, 1979, as amended at 52 FR 34907, Sept. 14, 1987; 
61 FR 20727, May 8, 1996]



Sec. 3.25  Parent's dependency and indemnity compensation (DIC)--Method of payment computation.

    Monthly payments of parents' DIC shall be computed in accordance 
with the following formulas:
    (a) One parent. Except as provided in paragraph (b) of this section, 
if there is only one parent, the monthly rate specified in 38 U.S.C 
1315(b)(1), as increased from time to time under 38 U.S.C. 5312, reduced 
by $.08 for each dollar of such parent's countable annual income in 
excess of $800. No payments of DIC may be made under this paragraph, 
however, if such parent's countable annual income exceeds the amount 
specified in 38 U.S.C. 1315(b)(3), as increased from time to time under 
38 U.S.C. 5312, and no payment of DIC to a parent under this paragraph 
may be less than $5 a month.
    (b) One parent who has remarried. If there is only one parent and 
the parent has remarried and is living with the parent's spouse, DIC 
shall be paid under paragraph (a) or paragraph (d) of this section, 
whichever shall result in the greater benefit being paid to the 
veteran's parent. In the case of remarriage, the total combined annual 
income of the parent and the parent's spouse shall be counted in 
determining the monthly rate of DIC.
    (c) Two parents not living together. The rate computation method in 
this paragraph applies to:
    (1) Two parents who are not living together, or
    (2) An unremarried parent when both parents are living and the other 
parent has remarried.

The monthly rate of DIC paid to such parent shall be the rate sepcified 
in 38 U.S.C. 1315(c)(1), as increased from time to time under 38 U.S.C. 
5312, reduced by an amount no greater than $.08 for each dollar of such 
parent's countable annual income in excess of $800, except that no 
payments of DIC may be made under this paragraph if such parent's 
countable annual income exceeds the amount specified in 38 U.S.C. 
1315(c)(3), as increased from time to time under 38 U.S.C. 5312, and no 
payment of DIC to a parent under this paragraph may be less than $5 
monthly. Each time there is a rate increase under 38 U.S.C. 5312, the 
amount of the reduction under this paragraph shall be recomputed to 
provide, as nearly as possible, for an equitable distribution of the 
rate increase. The results of this computation method shall be published 
in schedular format in the ``Notices'' section of the Federal Register 
as provided in paragraph (f) of this section.
    (d) Two parents living together or remarried parents living with 
spouse. The rate computation method in this paragraph applies to each 
parent living with another parent and to each remarried parent when both 
parents are alive. The monthly rate of DIC paid to such parents shall be 
the rate specified in 38 U.S.C. 1315(d)(1), as increased from time to 
time under 38 U.S.C. 5312, reduced to an amount no greater than $.08 for 
each dollar of such parent's and spouse's combined countable annual 
income in excess of $1,000 except that no payments of DIC to a parent 
under this paragraph may be less than $5 monthly. Each time there is a 
rate increase under 38 U.S.C. 5312, the amount of the reduction under 
this paragraph shall be recomputed to provide, as nearly as possible, 
for an equitable distribution of the rate increase. The results of this 
computation method shall be published in schedular format in the 
``Notices'' section of the Federal Register as provided in paragraph (f) 
of this section.
    (e) Aid and attendance. The monthly rate of DIC payable to a parent 
under this section shall be increased by the amount specified in 38 
U.S.C. 1315(g), as increased from time to time under 38 U.S.C. 5312, if 
such parent is:
    (1) A patient in a nursing home, or
    (2) Helpless or blind, or so nearly helpless or blind as to need or 
require the regular aid and attendance of another person.
    (f) Rate publication. Each time there is an increase under 38 U.S.C. 
5312, the actual rates will be published in the

[[Page 163]]

``Notices'' section of the Federal Register.

(Authority: 38 U.S.C. 501)

[52 FR 34907, Sept. 14, 1987, as amended at 61 FR 20727, May 8, 1996]



Sec. 3.26  Section 306 and old-law pension annual income limitations.

    (a) The annual income limitations for section 306 pension shall be 
the amounts specified in section 306(a)(2)(A) of Pub. L. 95-588, as 
increased from time to time under section 306(a)(3) of Pub. L. 95-588.
    (b) If a beneficiary under section 306 pension is in need of aid and 
attendance, the annual income limitation under paragraph (a) of this 
section shall be increased in accordance with 38 U.S.C. 1521(d), as in 
effect on December 31, 1978.
    (c) The annual income limitations for old-law pension shall be the 
amounts specified in section 306(b)(3) of Pub. L. 95-588, as increased 
from time to time under section 306(b)(4) of Pub. L. 95-588.
    (d) Each time there is an increase under section 306 (a)(3) or 
(b)(4) of Pub. L. 95-588, the actual income limitations will be 
published in the ``Notices'' section of the Federal Register.

(Authority: 38 U.S.C. 501)

[52 FR 34908, Sept. 14, 1987]



Sec. 3.27  Automatic adjustment of benefit rates.

    (a) Improved pension. Whenever there is a cost-of-living increase in 
benefit amounts payable under section 215(i) of title II of the Social 
Security Act, VA shall, effective on the dates such increases become 
effective, increase by the same percentage each maximum annual rate of 
pension.


(Authority: 38 U.S.C. 5312(a))

    (b) Parents' dependency and indemnity compensation--maximum annual 
income limitation and maximum monthly rates. Whenever there is a cost-
of-living increase in benefit amounts payable under section 215(i) of 
title II of the Social Security Act, VA shall, effective on the dates 
such increases become effective, increase by the same percentage the 
annual income limitations and the maximum monthly rates of dependency 
indemnity compensation for parents.


(Authority: 38 U.S.C. 5312(b)(1))

    (c) Monetary allowance under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans. Whenever there is a 
cost-of-living increase in benefit amounts payable under section 215(i) 
of Title II of the Social Security Act, VA shall, effective on the dates 
such increases become effective, increase by the same percentage the 
monthly allowance rates under 38 U.S.C. chapter 18.


(Authority: 38 U.S.C. 1805(b)(3), 1815(d), 5312)

    (d) Medal of Honor pension. Beginning in the year 2004, VA shall, 
effective December 1 of each year, increase the monthly Medal of Honor 
pension by the same percentage as the percentage by which benefit 
amounts payable under section 215(i) of Title II of the Social Security 
Act are increased effective December 1 of such year.


(Authority: 38 U.S.C. 1562(e))

    (e) Publishing requirements. Increases in pension rates, parents' 
dependency and indemnity compensation rates and income limitation, the 
monthly allowance rates under 38 U.S.C. chapter 18 and the Medal of 
Honor pension made under this section shall be published in the Federal 
Register.


(Authority: 38 U.S.C. 1805(b)(3), 1815(d), 5312(c)(1))

[44 FR 45934, Aug. 6, 1979, as amended at 52 FR 34908, Sept. 14, 1987; 
62 FR 51278, Sept. 30, 1997; 67 FR 49586, July 31, 2002; 68 FR 55467, 
Sept. 26, 2003]



Sec. 3.28  Automatic adjustment of section 306 and old-law pension income limitations.

    Whenever the maximum annual rates of improved pension are increased 
by reason of the provisions of 38 U.S.C. 5312, the following will be 
increased by the same percentage effective the same date:
    (a) The maximum annual income limitations applicable to continued 
receipt of section 306 and old-law pension; and
    (b) The dollar amount of a veteran's spouse's income that is 
excludable in

[[Page 164]]

determining the income of a veteran for section 306 pension purposes. 
(See Sec. 3.262(b)(2))

These increases shall be published in the Federal Register at the same 
time that increases under Sec. 3.27 are published.

(Authority: Sec. 306, Pub. L. 95-588).

[52 FR 34908, Sept. 14, 1987]

    Cross References: Section 306 and old-law pension annual income 
limitations. See Sec. 3.26.



Sec. 3.29  Rounding.

    (a) Annual rates. Where the computation of an increase in improved 
pension rates under Sec. Sec. 3.23 and 3.24 would otherwise result in a 
figure which includes a fraction of a dollar, the benefit rate will be 
adjusted to the next higher dollar amount. This method of computation 
will also apply to increases in old-law and section 306 pension annual 
income limitations under Sec. 3.26, including the income of a spouse 
which is excluded from a veteran's countable income, and parents' 
dependency and indemnity compensation benefit rates and annual income 
limitations under Sec. 3.25.


(Authority: 38 U.S.C. 5312(c)(2))

    (b) Monthly or other periodic pension rates. After determining the 
monthly or other periodic rate of improved pension under Sec. Sec. 
3.273 and 3.30 or the rate payable under section 306(a) of Pub. L. 95-
588 (92 Stat. 2508), the resulting rate, if not a multiple of one 
dollar, will be rounded down to the nearest whole dollar amount. The 
provisions of this paragraph apply with respect to amounts of pension 
payable for periods beginning on or after June 1, 1983, under the 
provisions of 38 U.S.C. 1521, 1541 or 1542, or under section 306(a) of 
Pub. L. 95-588.


(Authority: 38 U.S.C. 5123)

    (c) Monthly rates under 38 U.S.C. chapter 18. When increasing the 
monthly monetary allowance rates under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans, VA will round any 
resulting rate that is not an even dollar amount to the next higher 
dollar.

(Authority: 38 U.S.C. 1805(b)(3), 1815(d), 5312)

[48 FR 34471, July 29, 1983, as amended at 65 FR 35282, June 2, 2000; 67 
FR 49586, July 31, 2002]



Sec. 3.30  Frequency of payment of improved pension and parents' dependency and indemnity compensation (DIC).

    Payment shall be made as shown in paragraphs (a), (b), (c), (d), 
(e), and (f) of this section; however, beneficiaries receiving payment 
less frequently than monthly may elect to receive payment monthly in 
cases in which other Federal benefits would otherwise be denied.


(Authority: 38 U.S.C. 501)

    (a) Improved pension--Monthly. Payment shall be made monthly if the 
annual rate payable is $228 or more.
    (b) Improved pension--Quarterly. Payment shall be made every 3 
months on or about March 1, June 1, September l, and December 1, if the 
annual rate payable is at least $144 but less than $228.
    (c) Improved pension--Semiannually. Payment shall be made every 6 
months on or about June 1, and December 1, if the annual rate payable is 
at least $72 but less than $144.
    (d) Improved pension--Annually. Payment shall be made annually on or 
about June 1, if the annual rate payable is less than $72.


(Authority: 38 U.S.C. 1508)

    (e) Parents' DIC--Semiannually. Benefits shall be paid every 6 
months on or about June 1, and December 1, if the amount of the annual 
benefit is less than 4 percent of the maximum annual rate payable under 
38 U.S.C. 1315.
    (f) Payment of less than one dollar. Payments of less than $1 shall 
not be made.

    Cross Reference: Pension. See Sec. 3.3(a)(3), (b)(4).

[44 FR 45935, Aug. 6, 1979, as amended at 51 FR 1790, Jan. 15, 1986; 53 
FR 7903, Mar. 11, 1988; 57 FR 10425, Mar. 26, 1992; 71 FR 52290, Sept. 
5, 2006]

[[Page 165]]



Sec. 3.31  Commencement of the period of payment.

    Regardless of VA regulations concerning effective dates of awards, 
and except as provided in paragraph (c) of this section, payment of 
monetary benefits based on original, reopened, or increased awards of 
compensation, pension, dependency and indemnity compensation, or a 
monetary allowance under 38 U.S.C. chapter 18 for an individual who is a 
child of a Vietnam veteran may not be made for any period prior to the 
first day of the calendar month following the month in which the award 
became effective. However, beneficiaries will be deemed to be in receipt 
of monetary benefits during the period between the effective date of the 
award and the date payment commences for the purpose of all laws 
administered by the Department of Veterans Affairs except that nothing 
in this section will be construed as preventing the receipt of retired 
or retirement pay prior to the effective date of waiver of such pay in 
accordance with 38 U.S.C. 5305.
    (a) Increased award defined. For the purposes of this section the 
term increased award means an award which is increased because of an 
added dependent, increase in disability or disability rating, or 
reduction in income. The term also includes elections of improved 
pension under section 306 of Pub. L. 95-588 and awards pursuant to 
paragraphs 29 and 30 of the Schedule for Rating Disabilities except as 
provided in paragraph (c) of this section.
    (b) General rule of applicability. The provisions of this section 
apply to all original, reopened, or increased awards unless such awards 
provide only for continuity of entitlement with no increase in rate of 
payment.
    (c) Specific exclusions. The provisions of this section do not apply 
to the following types of awards.
    (1) Surviving spouse's rate for the month of a veteran's death (for 
exception see Sec. 3.20(b))
    (2) In cases where military retired or retirement pay is greater 
than the amount of compensation payable, compensation will be paid as of 
the effective date of waiver of such pay. However, in cases where the 
amount of compensation payable is greater than military retired or 
retirement pay, payment of the available difference for any period prior 
to the effective date of total waiver of such pay is subject to the 
general provisions of this section.
    (3) Adjustments of awards--such as in the case of original or 
increased apportionments or the termination of any withholding, 
reduction, or suspension by reason of:
    (i) Recoupment,
    (ii) An offset to collect indebtedness,
    (iii) Institutionalization (hospitalization),
    (iv) Incompetency,
    (v) Incarceration,
    (vi) An estate that exceeds the limitation for certain hospitalized 
incompetent veterans, or
    (vii) Discontinuance of apportionments.
    (4) Increases resulting solely from the enactment of legislation--
such as
    (i) Cost-of-living increases in compensation or dependency and 
indemnity compensation,
    (ii) Increases in Improved Pension, parents' dependency and 
indemnity compensation, or a monetary allowance under 38 U.S.C. chapter 
18 pursuant to Sec. 3.27, or
    (iii) Changes in the criteria for statutory award designations.
    (5) Temporary total ratings pursuant to paragraph 29 of the Schedule 
for Rating Disabilities when the entire period of hospitalization or 
treatment, including any period of post-hospitalization convalescence, 
commences and terminates within the same calendar month. In such cases 
the period of payment shall commence on the first day of the month in 
which the hospitalization or treatment began.

(Authority: 38 U.S.C. 1822, 5111)

[48 FR 34472, July 29, 1983; 48 FR 37031, Aug. 16, 1983, as amended at 
49 FR 47003, Nov. 30, 1984; 65 FR 35282, June 2, 2000; 67 FR 49586, July 
31, 2002]



Sec. 3.32  Exchange rates for foreign currencies.

    When determining the rates of pension or parents' DIC or the amounts 
of burial, plot or headstone allowances or accrued benefits to which a 
claimant or beneficiary may be entitled, income received or expenses 
paid in a foreign currency shall be converted into U.S.

[[Page 166]]

dollar equivalents employing quarterly exchange rates established by the 
Department of the Treasury.
    (a) Pension and parents' DIC. (1) Because exchange rates for foreign 
currencies cannot be determined in advance, rates of pension and 
parents' DIC shall be projected using the most recent quarterly exchange 
rate and shall be adjusted retroactively based upon actual exchange 
rates when an annual eligibility verification report is filed.
    (2) Retroactive adjustments due to fluctuations in exchange rates 
shall be calculated using the average of the four most recent quarterly 
exchange rates. If the claimant reports income and expenses for a prior 
reporting period, the retroactive adjustment shall be calculated using 
the average of the four quarterly rates which were the most recent 
available on the closing date of the twelve-month period for which 
income and expenses are reported.
    (b) Burial, plot or headstone allowances and accrued benefits. 
Payment amounts for burial, plot or headstone allowances and claims for 
accrued benefits as reimbursement from the person who bore the expenses 
of a deceased beneficiary's last illness or burial shall be determined 
using the quarterly exchange rate for the quarter in which the expenses 
forming the basis of the claim were paid. If the claim is filed by an 
unpaid creditor, however, the quarterly rate for the quarter in which 
the veteran died shall apply. When entitlement originates during a 
quarter for which the Department of the Treasury has not yet published a 
quarterly rate, amounts due shall be calculated using the most recent 
quarterly exchange rate.

    Cross-references: Accrued benefits. See Sec. 3.1000. Accrued 
benefits payable to foreign beneficiaries. See Sec. 3.1008.

(Authority: 38 U.S.C. 501)

[55 FR 8140, Mar. 7, 1990; 55 FR 10867, Mar. 23, 1990]

                                 General



Sec. 3.40  Philippine and Insular Forces.

    (a) Regular Philippine Scouts. Service in the Philippine Scouts 
(except that described in paragraph (b) of this section), the Insular 
Force of the Navy, Samoan Native Guard, and Samoan Native Band of the 
Navy is included for pension, compensation, dependency and indemnity 
compensation, and burial allowance. Benefits are payable in dollars at 
the full-dollar rate.
    (b) Other Philippine Scouts. Service of persons enlisted under 
section 14, Pub. L. 190, 79th Congress (Act of October 6, 1945), is 
included for compensation and dependency and indemnity compensation. 
Except as provided in Sec. Sec. 3.42 and 3.43, benefits based on 
service described in this paragraph are payable at a rate of $0.50 for 
each dollar authorized under the law. All enlistments and reenlistments 
of Philippine Scouts in the Regular Army between October 6, 1945, and 
June 30, 1947, inclusive, were made under the provisions of Pub. L. 190 
as it constituted the sole authority for such enlistments during that 
period. This paragraph does not apply to officers who were commissioned 
in connection with the administration of Pub. L. 190.


(Authority: 38 U.S.C. 107)

    (c) Commonwealth Army of the Philippines. (1) Service is included, 
for compensation, dependency and indemnity compensation, and burial 
allowance, from and after the dates and hours, respectively, when they 
were called into service of the Armed Forces of the United States by 
orders issued from time to time by the General Officer, U.S. Army, 
pursuant to the Military Order of the President of the United States 
dated July 26, 1941. Service as a guerrilla under the circumstances 
outlined in paragraph (d) of this section is also included. Except as 
provided in Sec. Sec. 3.42 and 3.43, benefits based on service 
described in this paragraph are payable at a rate of $0.50 for each 
dollar authorized under the law.


(Authority: 38 U.S.C. 107)

    (2) Unless the record shows examination at time of entrance into the 
Armed Forces of the United States, such persons are not entitled to the 
presumption of soundness. This also applies upon reentering the Armed 
Forces after a period of inactive service.

[[Page 167]]

    (d) Guerrilla service. (1) Persons who served as guerrillas under a 
commissioned officer of the United States Army, Navy or Marine Corps, or 
under a commissioned officer of the Commonwealth Army recognized by and 
cooperating with the United States Forces are included. (See paragraph 
(c) of this section.) Service as a guerrilla by a member of the 
Philippine Scouts or the Armed Forces of the United States is considered 
as service in his or her regular status. (See paragraph (a) of this 
section.)
    (2) The following certifications by the service departments will be 
accepted as establishing guerrilla service:
    (i) Recognized guerrilla service;
    (ii) Unrecognized guerrilla service under a recognized commissioned 
officer only if the person was a former member of the United States 
Armed Forces (including the Philippine Scouts), or the Commonwealth 
Army. This excludes civilians.


A certification of Anti-Japanese Activity will not be accepted as 
establishing guerrilla service.
    (e) Combined service. Where a veteran who had Commonwealth Army or 
guerrilla service and also had other service, wartime or peacetime, in 
the Armed Forces of the United States, has disabilities which are 
compensable separately on a dollar and a $0.50 for each dollar 
authorized basis, and the disabilities are combined under the authority 
contained in 38 U.S.C. 1157, the evaluation for which dollars are 
payable will be first considered and the difference between this 
evaluation and the combined evaluation will be the basis for computing 
the amount payable at the rate of $0.50 for each dollar authorized.

    Cross Reference: Computation of service. See Sec. 3.15.

[26 FR 1565, Feb. 24, 1961, as amended at 31 FR 14454, Nov. 10, 1966; 60 
FR 18355, Apr. 11, 1995. Redesignated and amended at 66 FR 66767, Dec. 
27, 2001; 71 FR 8220, Feb. 16, 2006]



Sec. 3.41  Philippine service.

    (a) For a Regular Philippine Scout or a member of one of the regular 
components of the Philippine Commonwealth Army while serving with Armed 
Forces of United States, the period of active service will be from the 
date certified by the Armed Forces as the date of enlistment or date of 
report for active duty whichever is later to date of release from active 
duty, discharge, death, or in the case of a member of the Philippine 
Commonwealth Army June 30, 1946, whichever was earlier. Release from 
active duty includes:
    (1) Leaving one's organization in anticipation of or due to the 
capitulation.
    (2) Escape from prisoner-of-war status.
    (3) Parole by the Japanese.
    (4) Beginning of missing-in-action status, except where factually 
shown at that time he was with his or her unit or death is presumed to 
have occurred while carried in such status: Provided, however, That 
where there is credible evidence that he was alive after commencement of 
his or her missing-in-action status, the presumption of death will not 
apply for Department of Veterans Affairs purposes.
    (5) Capitulation on May 6, 1942, except that periods of recognized 
guerrilla service or unrecognized guerrilla service under a recognized 
commissioned officer or periods of service in units which continued 
organized resistance against Japanese prior to formal capitulation will 
be considered return to active duty for period of such service.
    (b) Active service of a Regular Philippine Scout or a member of the 
Philippine Commonwealth Army serving with the Armed Forces of the United 
States will include a prisoner-of-war status immediately following a 
period of active duty, or a period of recognized guerrilla service or 
unrecognized guerrilla service under a recognized commissioned officer. 
In those cases where following release from active duty as set forth in 
paragraph (a) of this section, the veteran is factually found by the 
Department of Veterans Affairs to have been injured or killed by the 
Japanese because of anti-Japanese activities or his or her former 
service in the Armed Forces of the United States, such injury or death 
may be held to have been incurred in active service for Department of 
Veterans Affairs purposes. Determination shall be based on all available 
evidence, including service department reports, and consideration shall 
be given to the character

[[Page 168]]

and length of the veteran's former active service in the Armed Forces of 
the United States.
    (c) A prisoner-of-war status based upon arrest during general 
zonification will not be sufficient of itself to bring a case within the 
definition of return to military control.
    (d) The active service of members of the irregular forces guerrilla 
will be the period certified by the service department.

[26 FR 1566, Feb. 24, 1961, as amended at 26 FR 4612, May 26, 1961. 
Redesignated at 66 FR 66767, Dec. 27, 2001]



Sec. 3.42  Compensation at the full-dollar rate for certain Filipino veterans residing in the United States.

    (a) Definitions. For purposes of this section:
    (1) United States (U.S.) means the states, territories and 
possessions of the United States; the District of Columbia, and the 
Commonwealth of Puerto Rico.
    (2) Residing in the U.S. means that an individual's principal, 
actual dwelling place is in the U.S. and that the individual meets the 
residency requirements of paragraph (c)(4) of this section.
    (3) Citizen of the U.S. means any individual who acquires U.S. 
citizenship through birth in the territorial U.S., birth abroad as 
provided under title 8, United States Code, or through naturalization, 
and has not renounced his or her U.S. citizenship, or had such 
citizenship cancelled, revoked, or otherwise terminated.
    (4) Lawfully admitted for permanent residence means that an 
individual has been lawfully accorded the privilege of residing 
permanently in the U.S. as an immigrant by the U.S. Citizenship and 
Immigration Services under title 8, United States Code, and still has 
this status.
    (b) Eligibility requirements. Compensation and dependency and 
indemnity compensation is payable at the full-dollar rate, based on 
service described in Sec. 3.40(b), (c), or (d), to a veteran or a 
veteran's survivor who is residing in the U.S. and is either:
    (1) A citizen of the U.S., or
    (2) An alien lawfully admitted for permanent residence in the U.S.
    (c) Evidence of eligibility. (1) A valid original or copy of one of 
the following documents is required to prove that the veteran or the 
veteran's survivor is a natural born citizen of the U.S.:
    (i) A valid U.S. passport;
    (ii) A birth certificate showing that he or she was born in the 
U.S.; or
    (iii) A Report of Birth Abroad of a Citizen of the U.S. issued by a 
U.S. consulate abroad.
    (2) Only verification by the U.S. Citizenship and Immigration 
Services to VA that a veteran or a veteran's survivor is a naturalized 
citizen of the U.S., or a valid U.S. passport, will be sufficient proof 
of such status.
    (3) Only verification by the U.S. Citizenship and Immigration 
Services to VA that a veteran or a veteran's survivor is an alien 
lawfully admitted for permanent residence in the U.S. will be sufficient 
proof of such status.
    (4) VA will not pay benefits at the full-dollar rate under this 
section unless the evidence establishes that the veteran or survivor is 
lawfully residing in the U.S.
    (i) Such evidence should identify the veteran's or survivor's name 
and relevant dates, and may include:
    (A) A valid driver's license issued by the state of residence;
    (B) Employment records, which may consist of pay stubs, W-2 forms, 
and certification of the filing of Federal, State, or local income tax 
returns;
    (C) Residential leases, rent receipts, utility bills and receipts, 
or other relevant documents showing dates of utility service at a leased 
residence;
    (D) Hospital or medical records showing medical treatment or 
hospitalization, and showing the name of the medical facility or 
treating physician;
    (E) Property tax bills and receipts; and
    (F) School records.
    (ii) A Post Office box mailing address in the veteran's name or the 
name of the veteran's survivor does not constitute evidence showing that 
the veteran or veteran's survivor is lawfully residing in the United 
States.
    (d) Continued eligibility. (1) In order to continue receiving 
benefits at the full-dollar rate under this section, a veteran or a 
veteran's survivor must be physically present in the U.S. for at

[[Page 169]]

least 183 days of each calendar year in which he or she receives 
payments at the full-dollar rate, and may not be absent from the U.S. 
for more than 60 consecutive days at a time unless good cause is shown. 
However, if a veteran or a veteran's survivor becomes eligible for full-
dollar rate benefits for the first time on or after July 1 of any 
calendar year, the 183-day rule will not apply during that calendar 
year. VA will not consider a veteran or a veteran's survivor to have 
been absent from the U.S. if he or she left and returned to the U.S. on 
the same date.
    (2) A veteran or a veteran's survivor receiving benefits at the 
full-dollar rate under this section must notify VA within 30 days of 
leaving the U.S., or within 30 days of losing either his or her U.S. 
citizenship or lawful permanent resident alien status. When a veteran or 
a veteran's survivor no longer meets the eligibility requirements of 
paragraph (b) of this section, VA will reduce his or her payment to the 
rate of $0.50 for each dollar authorized under the law, effective on the 
date determined under Sec. 3.505. If such veteran or survivor regains 
his or her U.S. citizenship or lawful permanent resident alien status, 
VA will restore full-dollar rate benefits, effective the date the 
veteran or survivor meets the eligibility requirements in paragraph (b) 
of this section.
    (3) When requested to do so by VA, a veteran or survivor receiving 
benefits at the full-dollar rate under this section must verify that he 
or she continues to meet the residency and citizenship or permanent 
resident alien status requirements of paragraph (b) of this section. VA 
will advise the veteran or survivor at the time of the request that the 
verification must be furnished within 60 days and that failure to do so 
will result in the reduction of benefits. If the veteran or survivor 
fails to furnish the evidence within 60 days, VA will reduce his or her 
payment to the rate of $0.50 for each dollar authorized, as provided in 
Sec. 3.652.
    (4) A veteran or survivor receiving benefits at the full-dollar rate 
under this section must promptly notify VA of any change in his or her 
address. If mail from VA to the veteran or survivor is returned to VA by 
the U.S. Postal Service, VA will make reasonable efforts to determine 
the correct mailing address. If VA is unable to determine the correct 
mailing address through reasonable efforts, VA will reduce benefit 
payments to the rate of $0.50 for each dollar authorized under law, 
effective on the date determined under Sec. 3.505.
    (e) Effective date for restored eligibility. In the case of a 
veteran or survivor receiving benefits at the full-dollar rate, if VA 
reduces his or her payment to the rate of $0.50 for each dollar 
authorized under the law, VA will resume payments at the full-dollar 
rate, if otherwise in order, effective the first day of the month 
following the date on which he or she again meets the requirements. 
However, such increased payments will be retroactive no more than one 
year prior to the date on which VA receives evidence that he or she 
again meets the requirements.

(The Office of Management and Budget has approved the information 
collection requirements in this section under control number 2900-0655)

[66 FR 66767, Dec. 27, 2001, as amended at 71 FR 8220, Feb. 16, 2006; 72 
FR 9, Jan. 3, 2007]



Sec. 3.43  Burial benefits at the full-dollar rate for certain Filipino veterans residing in the United States on the date of death.

    (a) Definitions. For purposes of this section:
    (1) United States (U.S.) means the states, territories and 
possessions of the United States, the District of Columbia, and the 
Commonwealth of Puerto Rico.
    (2) Residing in the U.S. means an individual's principal, actual 
dwelling place was in the U.S. When death occurs outside the U.S., VA 
will consider the deceased individual to have been residing in the U.S. 
on the date of death if the individual maintained his or her principal 
actual dwelling place in the U.S. until his or her most recent departure 
from the U.S., and he or she had been physically absent from the U.S. 
less than 61 consecutive days when he or she died.
    (3) Citizen of the U.S. means any individual who acquires U.S. 
citizenship through birth in the territorial U.S., birth abroad as 
provided under title 8,

[[Page 170]]

United States Code, or through naturalization, and has not renounced his 
or her U.S. citizenship, or had such citizenship cancelled, revoked, or 
otherwise terminated.
    (4) Lawfully admitted for permanent residence means that the 
individual was lawfully accorded the privilege of residing permanently 
in the U.S. as an immigrant by the U.S. Citizenship and Immigration 
Services under title 8, United States Code, and on the date of death, 
still had this status.
    (b) Eligibility requirements. VA will pay burial benefits under 
chapter 23 of title 38, United States Code, at the full-dollar rate, 
based on service described in Sec. 3.40(c) or (d), when an individual 
who performed such service dies after November 1, 2000, or based on 
service described in Sec. 3.40(b) when an individual who performed such 
service dies after December 15, 2003, and was on the date of death:
    (1) Residing in the U.S.; and
    (2) Either--
    (i) A citizen of the U.S., or
    (ii) An alien lawfully admitted for permanent residence in the U.S.; 
and
    (3) Either--
    (i) Receiving compensation under chapter 11 of title 38, United 
States Code; or
    (ii) Would have satisfied the disability, income and net worth 
requirements of Sec. 3.3(a)(3) of this part and would have been 
eligible for pension if the veteran's service had been deemed to be 
active military, naval, or air service.
    (c) Evidence of eligibility. (1) In a claim for full-dollar rate 
burial payments based on the deceased veteran having been a natural born 
citizen of the U.S., a valid original or copy of one of the following 
documents is required:
    (i) A valid U.S. passport;
    (ii) A birth certificate showing that he or she was born in the 
U.S.; or
    (iii) A Report of Birth Abroad of a Citizen of the U.S. issued by a 
U.S. consulate abroad.
    (2) In a claim based on the deceased veteran having been a 
naturalized citizen of the U.S., only verification of that status by the 
U.S. Citizenship and Immigration Services to VA, or a valid U.S. 
passport, will be sufficient proof for purposes of eligibility for full-
dollar rate benefits.
    (3) In a claim based on the deceased veteran having been an alien 
lawfully admitted for permanent residence in the U.S., only verification 
of that status by the U.S. Citizenship and Immigration Services to VA 
will be sufficient proof for purposes of eligibility for full-dollar 
rate benefits.
    (4) VA will not pay benefits at the full-dollar rate under this 
section unless the evidence establishes that the veteran was lawfully 
residing in the U.S. on the date of death.
    (i) Such evidence should identify the veteran's name and relevant 
dates, and may include:
    (A) A valid driver's license issued by the state of residence;
    (B) Employment records, which may consist of pay stubs, W-2 forms, 
and certification of the filing of Federal, State, or local income tax 
returns;
    (C) Residential leases, rent receipts, utility bills and receipts, 
or other relevant documents showing dates of utility service at a leased 
residence;
    (D) Hospital or medical records showing medical treatment or 
hospitalization of the veteran or survivor, and showing the name of the 
medical facility or treating physician;
    (E) Property tax bills and receipts; and
    (F) School records.
    (ii) A Post Office box mailing address in the veteran's name does 
not constitute evidence showing that the veteran was lawfully residing 
in the United States on the date of death.

(Authority: 38 U.S.C. 107, 501(a))

(The Office of Management and Budget has approved the information 
collection requirements in this section under control number 2900-0655)

[66 FR 66767, Dec. 27, 2001, as amended at 71 FR 8221, Feb. 16, 2006; 72 
FR 9, Jan. 3, 2007]

                              Relationship



Sec. 3.50  Spouse and surviving spouse.

    (a) Spouse. ``Spouse'' means a person of the opposite sex whose 
marriage to the veteran meets the requirements of Sec. 3.1(j).
    (b) Surviving spouse. Except as provided in Sec. 3.52, ``surviving 
spouse'' means a person of the opposite sex

[[Page 171]]

whose marriage to the veteran meets the requirements of Sec. 3.1(j) and 
who was the spouse of the veteran at the time of the veteran's death 
and:
    (1) Who lived with the veteran continuously from the date of 
marriage to the date of the veteran's death except where there was a 
separation which was due to the misconduct of, or procured by, the 
veteran without the fault of the spouse; and
    (2) Except as provided in Sec. 3.55, has not remarried or has not 
since the death of the veteran and after September 19, 1962, lived with 
another person of the opposite sex and held himself or herself out 
openly to the public to be the spouse of such other person.

[62 FR 5529, Feb. 6, 1997]



Sec. 3.52  Marriages deemed valid.

    Where an attempted marriage of a claimant to the veteran was invalid 
by reason of a legal impediment, the marriage will nevertheless be 
deemed valid if:
    (a) The marriage occurred 1 year or more before the veteran died or 
existed for any period of time if a child was born of the purported 
marriage or was born to them before such marriage (see Sec. 3.54(d)), 
and
    (b) The claimant entered into the marriage without knowledge of the 
impediment, and
    (c) The claimant cohabited with the veteran continuously from the 
date of marriage to the date of his or her death as outlined in Sec. 
3.53, and
    (d) No claim has been filed by a legal surviving spouse who has been 
found entitled to gratuitous death benefits other than accrued monthly 
benefits covering a period prior to the veteran's death.

(Authority: 38 U.S.C. 103(a))

    Cross Reference: Definition, marriage. See Sec. 3.205(c).

[26 FR 1567, Feb. 24, 1961, as amended at 27 FR 1215, Feb. 9, 1962; 32 
FR 13224, Sept. 19, 1967; 41 FR 18299, May 3, 1976]



Sec. 3.53  Continuous cohabitation.

    (a) General. The requirement that there must be continuous 
cohabitation from the date of marriage to the date of death of the 
veteran will be considered as having been met when the evidence shows 
that any separation was due to the misconduct of, or procured by, the 
veteran without the fault of the surviving spouse. Temporary separations 
which ordinarily occur, including those caused for the time being 
through fault of either party, will not break the continuity of the 
cohabitation.
    (b) Findings of fact. The statement of the surviving spouse as to 
the reason for the separation will be accepted in the absence of 
contradictory information. If the evidence establishes that the 
separation was by mutual consent and that the parties lived apart for 
purposes of convenience, health, business, or any other reason which did 
not show an intent on the part of the surviving spouse to desert the 
veteran, the continuity of the cohabitation will not be considered as 
having been broken. State laws will not control in determining questions 
of desertion; however, due weight will be given to findings of fact in 
court decisions made during the life of the veteran on issues 
subsequently involved in the application of this section.

[41 FR 18300, May 3, 1976, as amended at 59 FR 32659, June 24, 1994]



Sec. 3.54  Marriage dates.

    A surviving spouse may qualify for pension, compensation, or 
dependency and indemnity compensation if the marriage to the veteran 
occurred before or during his or her service or, if married to him or 
her after his or her separation from service, before the applicable date 
stated in his section.
    (a) Pension. Death pension may be paid to a surviving spouse who was 
married to the veteran:
    (1) One year or more prior to the veteran's death, or
    (2) For any period of time if a child was born of the marriage, or 
was born to them before the marriage, or
    (3) Prior to the applicable delimiting dates, as follows:
    (i) Civil War--June 27, 1905.
    (ii) Indian wars--March 4, 1917.
    (iii) Spanish-American War--January 1, 1938.
    (iv) Mexican border period and World War I--December 14, 1944.
    (v) World War II--January 1, 1957.

[[Page 172]]

    (vi) Korean conflict--February 1, 1965.
    (vii) Vietnam era--May 8, 1985.
    (viii) Persian Gulf War--January 1, 2001.


(Authority: 38 U.S.C. 532(d), 534(c), 536(c), 541(e), 541(f))

    (b) Compensation. Death compensation may be paid to a surviving 
spouse who, with respect to date of marriage, could have qualified as a 
surviving spouse for death compensation under any law administered by 
the Department of Veterans Affairs in effect on December 31, 1957, or 
who was married to the veteran:
    (1) Before the expiration of 15 years after termination of the 
period of service in which the injury or disease which caused the 
veteran's death was incurred or aggravated, or
    (2) One year or more, or
    (3) For any period of time if a child was born of the marriage, or 
was born to them before the marriage.


(Authority: 38 U.S.C. 1102)

    (c) Dependency and indemnity compensation. Dependency and indemnity 
compensation payable under 38 U.S.C. 1310(a) may be paid to the 
surviving spouse of a veteran who died on or after January 1, 1957, who 
was married to the veteran:
    (1) Before the expiration of 15 years after the termination of the 
period of service in which the injury or disease causing the death of 
the veteran was incurred or aggravated, or
    (2) For 1 year or more, or
    (3) For any period of time if a child was born of the marriage, or 
was born to them before the marriage.


(Authority: 38 U.S.C. 1304)

    (d) Child born. The term child born of the marriage means a birth on 
or after the date of the marriage on which the surviving spouse's 
entitlement is predicated. The term born to them before the marriage 
means a birth prior to the date of such marriage. Either term includes a 
fetus advanced to the point of gestation required to constitute a birth 
under the law of the jurisdiction in which the fetus was delivered.
    (e) More than one marriage to veteran. For periods commencing on or 
after January 1, 1958, where a surviving spouse has been married legally 
to a veteran more than once, the date of the original marriage will be 
used in determining whether the statutory requirement as to date of 
marriage has been met.

(Authority: 38 U.S.C. 103(b))

[26 FR 1567, Feb. 24, 1961, as amended at 27 FR 6498, July 10, 1962; 32 
FR 13224, Sept. 19, 1967; 40 FR 16064, Apr. 9, 1975; 40 FR 48680, Oct. 
17, 1975; 41 FR 18300, May 3, 1976; 44 FR 22718, Apr. 17, 1979; 54 FR 
31829, Aug. 2, 1989; 56 FR 5756, Feb. 13, 1991; 56 FR 57986, Nov. 15, 
1991; 65 FR 3392, Jan. 21, 2000]



Sec. 3.55  Reinstatement of benefits eligibility based upon terminated marital relationships.

    (a) Surviving spouse. (1) Remarriage of a surviving spouse shall not 
bar the furnishing of benefits to such surviving spouse if the marriage:
    (i) Was void, or
    (ii) Has been annulled by a court having basic authority to render 
annulment decrees, unless it is determined by the Department of Veterans 
Affairs that the annulment was obtained through fraud by either party or 
by collusion.
    (2) On or after January 1, 1971, remarriage of a surviving spouse 
terminated prior to November 1, 1990, or terminated by legal proceedings 
commenced prior to November 1, 1990, by an individual who, but for the 
remarriage, would be considered the surviving spouse, shall not bar the 
furnishing of benefits to such surviving spouse provided that the 
marriage:
    (i) Has been terminated by death, or
    (ii) Has been dissolved by a court with basic authority to render 
divorce decrees unless the Department of Veterans Affairs determines 
that the divorce was secured through fraud by the surviving spouse or by 
collusion.
    (3) On or after October 1, 1998, remarriage of a surviving spouse 
terminated by death, divorce, or annulment, will not bar the furnishing 
of dependency and indemnity compensation, unless

[[Page 173]]

the Secretary determines that the divorce or annulment was secured 
through fraud or collusion.


(Authority: 38 U.S.C. 1311(e))

    (4) On or after December 1, 1999, remarriage of a surviving spouse 
terminated by death, divorce, or annulment, will not bar the furnishing 
of benefits relating to medical care for survivors and dependents under 
38 U.S.C. 1781, educational assistance under 38 U.S.C. chapter 35, or 
housing loans under 38 U.S.C. chapter 37, unless the Secretary 
determines that the divorce or annulment was secured through fraud or 
collusion.


(Authority: 38 U.S.C. 103(d))

    (5) On or after January 1, 1971, the fact that a surviving spouse 
has lived with another person and has held himself or herself out openly 
to the public as the spouse of such other person shall not bar the 
furnishing of benefits to him or her after he or she terminates the 
relationship, if the relationship terminated prior to November 1, 1990.
    (6) On or after October 1, 1998, the fact that a surviving spouse 
has lived with another person and has held himself or herself out openly 
to the public as the spouse of such other person will not bar the 
furnishing of dependency and indemnity compensation to the surviving 
spouse if he or she ceases living with such other person and holding 
himself or herself out openly to the public as such other person's 
spouse.


(Authority: 38 U.S.C. 1311(e))

    (7) On or after December 1, 1999, the fact that a surviving spouse 
has lived with another person and has held himself or herself out openly 
to the public as the spouse of such other person will not bar the 
furnishing of benefits relating to medical care for survivors and 
dependents under 38 U.S.C. 1781, educational assistance under 38 U.S.C. 
chapter 35, or housing loans under 38 U.S.C. chapter 37 to the surviving 
spouse if he or she ceases living with such other person and holding 
himself or herself out openly to the public as such other person's 
spouse.


(Authority: 38 U.S.C. 103(d))

    (8) On or after January 1, 1971, the fact that benefits to a 
surviving spouse may previously have been barred because his or her 
conduct or a relationship into which he or she had entered had raised an 
inference or presumption that he or she had remarried or had been 
determined to be open and notorious adulterous cohabitation, or similar 
conduct, shall not bar the furnishing of benefits to such surviving 
spouse after he or she terminates the conduct or relationship, if the 
relationship terminated prior to November 1, 1990.
    (9) Benefits under 38 U.S.C. 1781 for a surviving spouse who 
remarries after age 55. (i) On or after February 4, 2003, the remarriage 
of a surviving spouse after age 55 shall not bar the furnishing of 
benefits relating to medical care for survivors and dependents under 38 
U.S.C. 1781, subject to the limitation in paragraph (a)(9)(ii) of this 
section.
    (ii) A surviving spouse who remarried after the age of 55, but 
before December 6, 2002, may be eligible for benefits relating to 
medical care for survivors and dependents under 38 U.S.C. 1781 pursuant 
to paragraph (a)(9)(i) only if the application for such benefits was 
received by VA before December 16, 2004.

(Authority: 38 U.S.C. 103)

    (10) Benefits for a surviving spouse who remarries after age 57. (i) 
On or after January 1, 2004, the remarriage of a surviving spouse after 
the age of 57 shall not bar the furnishing of benefits relating to 
dependency and indemnity compensation under 38 U.S.C. 1311, medical care 
for survivors and dependents under 38 U.S.C. 1781, educational 
assistance under 38 U.S.C. chapter 35, or housing loans under 38 U.S.C. 
chapter 37, subject to the limitation in paragraph (a)(10)(ii) of this 
section.
    (ii) A surviving spouse who remarried after the age of 57, but 
before December 16, 2003, may be eligible for dependency and indemnity 
compensation under 38 U.S.C. 1311, medical care for survivors and 
dependents under 38 U.S.C. 1781, educational assistance under 38 U.S.C. 
chapter 35, or housing loans under 38 U.S.C. chapter 37 pursuant to 
paragraph (a)(10)(i) only if the application

[[Page 174]]

for such benefits was received by VA before December 16, 2004.

(Authority: 38 U.S.C. 103)

    (b) Child. (1) Marriage of a child shall not bar the furnishing of 
benefits to or on account of such child, if the marriage:
    (i) Was void, or
    (ii) Has been annulled by a court having basic authority to render 
annulment decrees, unless it is determined by the Department of Veterans 
Affairs that the annulment was obtained through fraud by either party or 
by collusion.
    (2) On or after January 1, 1975, marriage of a child terminated 
prior to November 1, 1990, shall not bar the furnishing of benefits to 
or for such child provided that the marriage:
    (i) Has been terminated by death, or
    (ii) Has been dissolved by a court with basic authority to render 
divorce decrees unless the Department of Veterans Affairs determines 
that the divorce was secured through fraud by either party or by 
collusion.

(Authority: 38 U.S.C. 103; 105 Stat. 424, 106 Stat. 4322)

    Cross References: Evidence. See Sec. Sec. 3.206 and 3.207. 
Termination of marital relationship or conduct. See Sec. 3.215.

[58 FR 32444, June 10, 1993, as amended at 60 FR 52863, Oct. 11, 1995; 
64 FR 30245, June 7, 1999; 65 FR 43700, July 14, 2000; 71 FR 29084, May 
19, 2006]



Sec. 3.56  [Reserved]



Sec. 3.57  Child.

    (a) General. (1) Except as provided in paragraphs (a)(2) and (3) of 
this section, the term child of the veteran means an unmarried person 
who is a legitimate child, a child legally adopted before the age of 18 
years, a stepchild who acquired that status before the age of 18 years 
and who is a member of the veteran's household or was a member of the 
veteran's household at the time of the veteran's death, or an 
illegitimate child; and
    (i) Who is under the age of 18 years; or
    (ii) Who, before reaching the age of 18 years, became permanently 
incapable of self-support; or
    (iii) Who, after reaching the age of 18 years and until completion 
of education or training (but not after reaching the age of 23 years) is 
pursuing a course of instruction at an educational institution approved 
by the Department of Veterans Affairs. For the purposes of this section 
and Sec. 3.667, the term ``educational institution'' means a permanent 
organization that offers courses of instruction to a group of students 
who meet its enrollment criteria, including schools, colleges, 
academies, seminaries, technical institutes, and universities. The term 
also includes home schools that operate in compliance with the 
compulsory attendance laws of the States in which they are located, 
whether treated as private schools or home schools under State law. The 
term ``home schools'' is limited to courses of instruction for grades 
kindergarten through 12.


(Authority: 38 U.S.C. 101(4)(A), 104(a))

    (2) For the purposes of determining entitlement of benefits based on 
a child's school attendance, the term child of the veteran also includes 
the following unmarried persons:
    (i) A person who was adopted by the veteran between the ages of 18 
and 23 years.
    (ii) A person who became a stepchild of the veteran between the ages 
of 18 and 23 years and who is a member of the veteran's household or was 
a member of the veteran's household at the time of the veteran's death.
    (3) Subject to the provisions of paragraphs (c) and (e) of this 
section, the term child also includes a person who became permanently 
incapable of self-support before reaching the age of 18 years, who was a 
member of the veteran's household at the time he or she became 18 years 
of age, and who was adopted by the veteran, regardless of the age of 
such person at the time of adoption.


(Authority: 38 U.S.C. 101(4)(A))

    (b) Stepchild. The term means a legitimate or an illegitimate child 
of the veteran's spouse. A child of a surviving spouse whose marriage to 
the veteran is deemed valid under the provisions of Sec. 3.52, and who 
otherwise meets the requirements of this section is included.

[[Page 175]]

    (c) Adopted child. Except as provided in paragraph (e) of this 
section, the term means a child adopted pursuant to a final decree of 
adoption, a child adopted pursuant to an unrescinded interlocutory 
decree of adoption while remaining in the custody of the adopting parent 
(or parents) during the interlocutory period, and a child who has been 
placed for adoption under an agreement entered into by the adopting 
parent (or parents) with any agency authorized under law to so act, 
unless and until such agreement is terminated, while the child remains 
in the custody of the adopting parent (or parents) during the period of 
placement for adoption under such agreement. The term includes, as of 
the date of death of a veteran, such a child who:
    (1) Was living in the veteran's household at the time of the 
veteran's death, and
    (2) Was adopted by the veteran's spouse under a decree issued within 
2 years after August 25, 1959, or the veteran's death whichever is 
later, and
    (3) Was not receiving from an individual other than the veteran or 
the veteran's spouse, or from a welfare organization which furnishes 
services or assistance for children, recurring contributions of 
sufficient size to constitute the major portion of the child's support.


(Authority: 38 U.S.C. 101(4))

    (d) Definition of child custody. The provisions of this paragraph 
are for the purpose of determining entitlement to improved pension under 
Sec. Sec. 3.23 and 3.24.
    (1) Custody of a child shall be considered to rest with a veteran, 
surviving spouse of a veteran or person legally responsible for the 
child's support if that person has the legal right to exercise parental 
control and responsibility for the welfare and care of the child. A 
child of the veteran residing with the veteran, surviving spouse of the 
veteran who is the child's natural or adoptive parent, or person legally 
responsible for the child's support shall be presumed to be in the 
custody of that individual. Where the veteran, surviving spouse, or 
person legally responsible for the child's support has not been divested 
of legal custody, but the child is not residing with that individual, 
the child shall be considered in the custody of the individual for 
purposes of Department of Veterans Affairs benefits.
    (2) The term person legally responsible for the child's support 
means a person who is under a legally imposed obligation (e.g., by 
statute or court order) to provide for the child's support, as well as a 
natural or adoptive parent who has not been divested of legal custody. 
If the child's natural or adoptive parent has remarried, the stepparent 
may also be considered a person legally responsible for the child's 
support. A child shall be considered in the joint custody of his or her 
stepparent and natural or adoptive parent so long as the natural or 
adoptive parent and the stepparent are not estranged and residing apart, 
and the natural or adoptive parent has not been divested of legal 
custody. When a child is in such joint custody the combined income of 
the natural or adoptive parent and the stepparent shall be included as 
income of the person legally responsible for support under Sec. 
3.24(c).
    (3) A person having custody of a child prior to the time the child 
attains age 18 shall be considered to retain custody of the child for 
periods on and after the child's 18th birthday, unless the person is 
divested of legal custody. This applies without regard to when a child 
reaches the age of majority under applicable State law. This also 
applies without regard to whether the child was entitled to pension 
prior to age 18, or whether increased pension was payable to a veteran 
or surviving spouse on behalf of the child prior to the child's 18th 
birthday. If the child's custodian dies after the child has attained age 
18, the child shall be considered to be in custody of a successor 
custodian provided the successor custodian has the right to exercise 
parental control and responsibility for the welfare and care of the 
child.


(Authority: 38 U.S.C. 501, 1521(c), 1541(c))

    (e) Child adopted under foreign law--(1) General. The provisions of 
this paragraph are applicable to a person adopted under the laws of any 
jurisdiction other than a State. The term State is defined in 38 U.S.C. 
101(20) and also includes the Commonwealth of the

[[Page 176]]

Northern Mariana Islands. The term veteran includes, for the purposes of 
this paragraph, a Commonwealth Army veteran or new Philippine Scout as 
defined in 38 U.S.C. 3566.
    (2) Adopted child of living veteran. A person residing outside any 
of the States shall not be considered to be a legally adopted child of a 
veteran during the lifetime of the veteran unless all of the following 
conditions are met.
    (i) The person was less than 18 years of age at the time of 
adoption.
    (ii) The person is receiving one-half or more of the person's 
support from the veteran.
    (iii) The person is not in the custody of the person's natural 
parent unless the natural parent is the veteran's spouse.
    (iv) The person is residing with the veteran (or in the case of 
divorce following adoption, with the divorced spouse who is also a 
natural or adoptive parent) except for periods during which the person 
is residing apart from the veteran for purposes of full-time attendance 
at an educational institution or during which the person or the veteran 
is confined in a hospital, nursing home, other health-care facility, or 
other institution.
    (3) Adopted child of deceased veteran. A person shall not be 
considered to have been a legally adopted child of a veteran as of the 
date of the veteran's death and thereafter unless one of the following 
conditions is met.
    (i) The veteran was entitled to and was receiving for the person a 
dependent's allowance or similar monetary benefit payable under title 
38, United States Code at any time within the 1-year period immediately 
preceding the veteran's death; or
    (ii) The person met the requirements of paragraph (e)(2) of this 
section for a period of at least 1 year prior to the veteran's death.
    (4) Verification. In the case of an adopted child of a living 
veteran, the requirements of paragraphs (e)(2)(ii), (iii) and (iv) of 
this section are for prospective application. That is, in addition to 
meeting all of the requirements of paragraph (e)(2) of this section at 
the time of initial adjudication, benefits are not payable thereafter 
for or to a child adopted under the laws of any jurisdiction other than 
a State unless the requirements of paragraphs (e)(2)(ii), (iii) and (iv) 
of this section continue to be met. Consequently, whenever Department of 
Veterans Affairs benefits are payable to or for a child adopted under 
the laws of any jurisdiction other than a State, and the veteran who 
adopted the child is living, the beneficiary shall submit, upon 
Department of Veterans Affairs request, a report, or other evidence, to 
determine if the requirements of paragraph (e)(2)(ii), (iii), and (iv) 
of this section were met for any period for which payment was made for 
or to the child and whether such requirements will continue to be met 
for future entitlement periods. Failure to submit the requested report 
or evidence within a reasonable time from date of request may result in 
termination of benefits payable for or to the child.

(Authority: 38 U.S.C. 101(4), 501)

    Cross References: Improved pension rates. See Sec. 3.23. Improved 
pension rates; surviving children. See Sec. 3.24. Child's relationship. 
See Sec. 3.210. Helplessness. See Sec. 3.403(a)(1). Helplessness. See 
Sec. 3.503(a)(3). School attendance. See Sec. 3.667. Helpless 
children--Spanish-American and prior wars. See Sec. 3.950.

[44 FR 45935, Aug. 6, 1979 and 45 FR 1878, Jan. 9, 1980, as amended at 
45 FR 25391, Apr. 15, 1980; 49 FR 47003, Nov. 30, 1984; 65 FR 12116, 
Mar. 8, 2000; 72 FR 6959, Feb. 14, 2007]



Sec. 3.58  Child adopted out of family.

    A child of a veteran adopted out of the family of the veteran either 
prior or subsequent to the veteran's death is nevertheless a child 
within the meaning of that term as defined by Sec. 3.57 and is eligible 
for benefits payable under all laws administered by the Department of 
Veterans Affairs.

    Cross Reference: Veteran's benefits not apportionable. See Sec. 
3.458.

[26 FR 1568, Feb. 24, 1961]



Sec. 3.59  Parent.

    (a) The term parent means a natural mother or father (including the 
mother of an illegitimate child or the father of an illegitimate child 
if the usual family relationship existed), mother or father through 
adoption, or a person who for a period of not less than 1 year

[[Page 177]]

stood in the relationship of a parent to a veteran at any time before 
his or her entry into active service.
    (b) Foster relationship must have begun prior to the veteran's 21st 
birthday. Not more than one father and one mother, as defined, will be 
recognized in any case. If two persons stood in the relationship of 
father or mother for 1 year or more, the person who last stood in such 
relationship before the veteran's last entry into active service will be 
recognized as the parent.

(Authority: 38 U.S.C. 101(5))

[26 FR 1568, Feb. 24, 1961, as amended at 44 FR 45935, Aug. 6, 1979]



Sec. 3.60  Definition of ``living with''.

    For the purposes of determining entitlement to pension under 38 
U.S.C. 1521, a person shall be considered as living with his or her 
spouse even though they reside apart unless they are estranged.

(Authority: 38 U.S.C. 1521(h)(2))

[44 FR 45935, Aug. 6, 1979]

                             Administrative



Sec. 3.100  Delegations of authority.

    (a) Authority is delegated to the Under Secretary for Benefits and 
to supervisory or adjudicative personnel within the jurisdiction of the 
Veterans Benefits Administration designated by the Under Secretary to 
make findings and decisions under the applicable laws, regulations, 
precedents, and instructions, as to entitlement of claimants to benefits 
under all laws administered by the Department of Veterans Affairs 
governing the payment of monetary benefits to veterans and their 
dependents, within the jurisdiction of Compensation and Pension Service.
    (b) Authority is delegated to the Director, Compensation and Pension 
Service, and to personnel of that service designated by him to determine 
whether a claimant or payee has forfeited the right to gratuitious 
benefits or to remit a prior forfeiture pursuant to the provisions of 38 
U.S.C. 6103 or 6104. See Sec. 3.905.

(Authority: 38 U.S.C. 512(a))

[29 FR 7547, June 12, 1964, as amended at 31 FR 14455, Nov. 10, 1966; 37 
FR 10442, May 23, 1972; 53 FR 3207, Feb. 4, 1988; 60 FR 18355, Apr. 11, 
1995; 61 FR 20727, May 8, 1996]



Sec. 3.102  Reasonable doubt.

    It is the defined and consistently applied policy of the Department 
of Veterans Affairs to administer the law under a broad interpretation, 
consistent, however, with the facts shown in every case. When, after 
careful consideration of all procurable and assembled data, a reasonable 
doubt arises regarding service origin, the degree of disability, or any 
other point, such doubt will be resolved in favor of the claimant. By 
reasonable doubt is meant one which exists because of an approximate 
balance of positive and negative evidence which does not satisfactorily 
prove or disprove the claim. It is a substantial doubt and one within 
the range of probability as distinguished from pure speculation or 
remote possibility. It is not a means of reconciling actual conflict or 
a contradiction in the evidence. Mere suspicion or doubt as to the truth 
of any statements submitted, as distinguished from impeachment or 
contradiction by evidence or known facts, is not justifiable basis for 
denying the application of the reasonable doubt doctrine if the entire, 
complete record otherwise warrants invoking this doctrine. The 
reasonable doubt doctrine is also applicable even in the absence of 
official records, particularly if the basic incident allegedly arose 
under combat, or similarly strenuous conditions, and is consistent with 
the probable results of such known hardships.

(Authority: 38 U.S.C. 501)

[50 FR 34458, Aug. 26, 1985, as amended at 66 FR 45630, Aug. 29, 2001]



Sec. 3.103  Procedural due process and appellate rights.

    (a) Statement of policy. Every claimant has the right to written 
notice of the decision made on his or her claim, the right to a hearing, 
and the right of representation. Proceedings before VA

[[Page 178]]

are ex parte in nature, and it is the obligation of VA to assist a 
claimant in developing the facts pertinent to the claim and to render a 
decision which grants every benefit that can be supported in law while 
protecting the interests of the Government. The provisions of this 
section apply to all claims for benefits and relief, and decisions 
thereon, within the purview of this part 3.
    (b) The right to notice--(1) General. Claimants and their 
representatives are entitled to notice of any decision made by VA 
affecting the payment of benefits or the granting of relief. Such notice 
shall clearly set forth the decision made, any applicable effective 
date, the reason(s) for the decision, the right to a hearing on any 
issue involved in the claim, the right of representation and the right, 
as well as the necessary procedures and time limits, to initiate an 
appeal of the decision.
    (2) Advance notice and opportunity for hearing. Except as otherwise 
provided in paragraph (b)(3) of this section, no award of compensation, 
pension or dependency and indemnity compensation shall be terminated, 
reduced or otherwise adversely affected unless the beneficiary has been 
notified of such adverse action and has been provided a period of 60 
days in which to submit evidence for the purpose of showing that the 
adverse action should not be taken.
    (3) Exceptions. In lieu of advance notice and opportunity for a 
hearing, VA will send a written notice to the beneficiary or his or her 
fiduciary at the same time it takes an adverse action under the 
following circumstances:
    (i) An adverse action based solely on factual and unambiguous 
information or statements as to income, net worth, or dependency or 
marital status that the beneficiary or his or her fiduciary provided to 
VA in writing or orally (under the procedures set forth in Sec. 
3.217(b)), with knowledge or notice that such information would be used 
to calculate benefit amounts.
    (ii) An adverse action based upon the beneficiary's or fiduciary's 
failure to return a required eligibility verification report.
    (iii) Evidence reasonably indicates that a beneficiary is deceased. 
However, in the event that VA has received a death certificate, a 
terminal hospital report verifying the death of a beneficiary or a claim 
for VA burial benefits, no notice of termination (contemporaneous or 
otherwise) will be required.
    (iv) An adverse action based upon a written and signed statement 
provided by the beneficiary to VA renouncing VA benefits (see Sec. 
3.106 on renouncement).
    (v) An adverse action based upon a written statement provided to VA 
by a veteran indicating that he or she has returned to active service, 
the nature of that service, and the date of reentry into service, with 
the knowledge or notice that receipt of active service pay precludes 
concurrent receipt of VA compensation or pension (see Sec. 3.654 
regarding active service pay).
    (vi) An adverse action based upon a garnishment order issued under 
42 U.S.C. 659(a).


(Authority: 38 U.S.C. 501(a))

    (4) Restoration of benefits. VA will restore retroactively benefits 
that were reduced, terminated, or otherwise adversely affected based on 
oral information or statements if within 30 days of the date on which VA 
issues the notification of adverse action the beneficiary or his or her 
fiduciary asserts that the adverse action was based upon information or 
statements that were inaccurate or upon information that was not 
provided by the beneficiary or his or her fiduciary. This will not 
preclude VA from taking subsequent action that adversely affects 
benefits.
    (c) The right to a hearing. (1) Upon request, a claimant is entitled 
to a hearing at any time on any issue involved in a claim within the 
purview of part 3 of this chapter, subject to the limitations described 
in Sec. 20.1304 of this chapter with respect to hearings in claims 
which have been certified to the Board of Veterans Appeals for appellate 
review. VA will provide the place of hearing in the VA office having 
original jurisdiction over the claim or at the VA office nearest the 
claimant's home having adjudicative functions, or, subject to available 
resources and solely at the

[[Page 179]]

option of VA, at any other VA facility or federal building at which 
suitable hearing facilities are available. VA will provide one or more 
employees who have original determinative authority of such issues to 
conduct the hearing and be responsible for establishment and 
preservation of the hearing record. Hearings in connection with proposed 
adverse actions and appeals shall be held before one or more VA 
employees having original determinative authority who did not 
participate in the proposed action or the decision being appealed. All 
expenses incurred by the claimant in connection with the hearing are the 
responsibility of the claimant.
    (2) The purpose of a hearing is to permit the claimant to introduce 
into the record, in person, any available evidence which he or she 
considers material and any arguments or contentions with respect to the 
facts and applicable law which he or she may consider pertinent. All 
testimony will be under oath or affirmation. The claimant is entitled to 
produce witnesses, but the claimant and witnesses are expected to be 
present. The Veterans Benefits Administration will not normally schedule 
a hearing for the sole purpose of receiving argument from a 
representative. It is the responsibility of the VA employee or employees 
conducting the hearings to explain fully the issues and suggest the 
submission of evidence which the claimant may have overlooked and which 
would be of advantage to the claimant's position. To assure clarity and 
completeness of the hearing record, questions which are directed to the 
claimant and to witnesses are to be framed to explore fully the basis 
for claimed entitlement rather than with an intent to refute evidence or 
to discredit testimony. In cases in which the nature, origin, or degree 
of disability is in issue, the claimant may request visual examination 
by a physician designated by VA and the physician's observations will be 
read into the record.


(Authority: 38 U.S.C. 501)

    (d) Submission of evidence. Any evidence whether documentary, 
testimonial, or in other form, offered by the claimant in support of a 
claim and any issue a claimant may raise and any contention or argument 
a claimant may offer with respect thereto are to be included in the 
records.
    (e) The right to representation. Subject to the provisions of 
Sec. Sec. 14.626 through 14.637 of this title, claimants are entitled 
to representation of their choice at every stage in the prosecution of a 
claim.
    (f) Notification of decisions. The claimant or beneficiary and his 
or her representative will be notified in writing of decisions affecting 
the payment of benefits or granting relief. All notifications will 
advise the claimant of the reason for the decision; the date the 
decision will be effective; the right to a hearing subject to paragraph 
(c) of this section; the right to initiate an appeal by filing a Notice 
of Disagreement which will entitle the individual to a Statement of the 
Case for assistance in perfecting an appeal; and the periods in which an 
appeal must be initiated and perfected (See part 20 of this chapter, on 
appeals). Further, any notice that VA has denied a benefit sought will 
include a summary of the evidence considered.

(Authority:38 U.S.C. 501, 1115, 1506, 5104)

[55 FR 13527, Apr. 11, 1990; 55 FR 17530, Apr. 25, 1990, as amended at 
55 FR 20148, May 15, 1990; 55 FR 25308, June 21, 1990; 57 FR 56993, Dec. 
2, 1992; 58 FR 16360, Mar. 26, 1993; 58 FR 59366, Nov. 9, 1993; 59 FR 
6218, Feb. 10, 1994; 59 FR 6901, Feb. 14, 1994; 66 FR 56613, Nov. 9, 
2001]



Sec. 3.104  Finality of decisions.

    (a) A decision of a duly constituted rating agency or other agency 
of original jurisdiction shall be final and binding on all field offices 
of the Department of Veterans Affairs as to conclusions based on the 
evidence on file at the time VA issues written notification in 
accordance with 38 U.S.C. 5104. A final and binding agency decision 
shall not be subject to revision on the same factual basis except by 
duly constituted appellate authorities or except as provided in Sec. 
3.105 and Sec. 3.2600 of this part.
    (b) Current determinations of line of duty, character of discharge, 
relationship, dependency, domestic relations questions, homicide, and 
findings of fact of death or presumptions of death

[[Page 180]]

made in accordance with existing instructions, and by application of the 
same criteria and based on the same facts, by either an Adjudication 
activity or an Insurance activity are binding one upon the other in the 
absence of clear and unmistakable error.

[29 FR 1462, Jan. 29, 1964, as amended at 29 FR 7547, June 12, 1964; 56 
FR 65846, Dec. 19, 1991; 66 FR 21874, May 2, 2001]



Sec. 3.105  Revision of decisions.

    The provisions of this section apply except where an award was based 
on an act of commission or omission by the payee, or with his or her 
knowledge (Sec. 3.500(b)); there is a change in law or a Department of 
Veterans Affairs issue, or a change in interpretation of law or a 
Department of Veterans Affairs issue (Sec. 3.114); or the evidence 
establishes that service connection was clearly illegal. The provisions 
with respect to the date of discontinuance of benefits are applicable to 
running awards. Where the award has been suspended, and it is determined 
that no additional payments are in order, the award will be discontinued 
effective date of last payment.
    (a) Error. Previous determinations which are final and binding, 
including decisions of service connection, degree of disability, age, 
marriage, relationship, service, dependency, line of duty, and other 
issues, will be accepted as correct in the absence of clear and 
unmistakable error. Where evidence establishes such error, the prior 
decision will be reversed or amended. For the purpose of authorizing 
benefits, the rating or other adjudicative decision which constitutes a 
reversal of a prior decision on the grounds of clear and unmistakable 
error has the same effect as if the corrected decision had been made on 
the date of the reversed decision. Except as provided in paragraphs (d) 
and (e) of this section, where an award is reduced or discontinued 
because of administrative error or error in judgment, the provisions of 
Sec. 3.500(b)(2) will apply.
    (b) Difference of opinion. Whenever an adjudicative agency is of the 
opinion that a revision or an amendment of a previous decision is 
warranted, a difference of opinion being involved rather than a clear 
and unmistakable error, the proposed revision will be recommended to 
Central Office. However, a decision may be revised under Sec. 3.2600 
without being recommended to Central Office.
    (c) Character of discharge. A determination as to character of 
discharge or line of duty which would result in discontinued entitlement 
is subject to the provisions of paragraph (d) of this section.
    (d) Severance of service connection. Subject to the limitations 
contained in Sec. Sec. 3.114 and 3.957, service connection will be 
severed only where evidence establishes that it is clearly and 
unmistakably erroneous (the burden of proof being upon the Government). 
(Where service connection is severed because of a change in or 
interpretation of a law or Department of Veterans Affairs issue, the 
provisions of Sec. 3.114 are for application.) A change in diagnosis 
may be accepted as a basis for severance action if the examining 
physician or physicians or other proper medical authority certifies 
that, in the light of all accumulated evidence, the diagnosis on which 
service connection was predicated is clearly erroneous. This 
certification must be accompanied by a summary of the facts, findings, 
and reasons supporting the conclusion. When severance of service 
connection is considered warranted, a rating proposing severance will be 
prepared setting forth all material facts and reasons. The claimant will 
be notified at his or her latest address of record of the contemplated 
action and furnished detailed reasons therefor and will be given 60 days 
for the presentation of additional evidence to show that service 
connection should be maintained. Unless otherwise provided in paragraph 
(i) of this section, if additional evidence is not received within that 
period, final rating action will be taken and the award will be reduced 
or discontinued, if in order, effective the last day of the month in 
which a 60-day period from the date of notice to the beneficiary of the 
final rating action expires.


(Authority: 38 U.S.C. 5112(b)(6))

    (e) Reduction in evaluation--compensation. Where the reduction in 
evaluation

[[Page 181]]

of a service-connected disability or employability status is considered 
warranted and the lower evaluation would result in a reduction or 
discontinuance of compensation payments currently being made, a rating 
proposing the reduction or discontinuance will be prepared setting forth 
all material facts and reasons. The beneficiary will be notified at his 
or her latest address of record of the contemplated action and furnished 
detailed reasons therefor, and will be given 60 days for the 
presentation of additional evidence to show that compensation payments 
should be continued at their present level. Unless otherwise provided in 
paragraph (i) of this section, if additional evidence is not received 
within that period, final rating action will be taken and the award will 
be reduced or discontinued effective the last day of the month in which 
a 60-day period from the date of notice to the beneficiary of the final 
rating action expires.


(Authority: 38 U.S.C. 5112(b)(6))

    (f) Reduction in evaluation--pension. Where a change in disability 
or employability warrants a reduction or discontinuance of pension 
payments currently being made, a rating proposing the reduction or 
discontinuance will be prepared setting forth all material facts and 
reasons. The beneficiary will be notified at his or her latest address 
of record of the contemplated action and furnished detailed reasons 
therefor, and will be given 60 days for the presentation of additional 
evidence to show that pension benefits should be continued at their 
present level. Unless otherwise provided in paragraph (i) of this 
section, if additional evidence is not received within that period, 
final rating action will be taken and the award will be reduced or 
discontinued effective the last day of the month in which the final 
rating action is approved.


(Authority: 38 U.S.C. 5112(b)(5))

    (g) Reduction in evaluation--monetary allowance under 38 U.S.C. 
chapter 18 for certain individuals who are children of Vietnam veterans. 
Where a reduction or discontinuance of a monetary allowance currently 
being paid under 38 U.S.C. chapter 18 is considered warranted, VA will 
notify the beneficiary at his or her latest address of record of the 
proposed reduction, furnish detailed reasons therefor, and allow the 
beneficiary 60 days to present additional evidence to show that the 
monetary allowance should be continued at the present level. Unless 
otherwise provided in paragraph (i) of this section, if VA does not 
receive additional evidence within that period, it will take final 
rating action and reduce the award effective the last day of the month 
following 60 days from the date of notice to the beneficiary of the 
proposed reduction.


(Authority: 38 U.S.C. 1822, 5112(b)(6))

    (h) Other reductions/discontinuances. Except as otherwise specified 
at Sec. 3.103(b)(3) of this part, where a reduction or discontinuance 
of benefits is warranted by reason of information received concerning 
income, net worth, dependency, or marital or other status, a proposal 
for the reduction or discontinuance will be prepared setting forth all 
material facts and reasons. The beneficiary will be notified at his or 
her latest address of record of the contemplated action and furnished 
detailed reasons therefor, and will be given 60 days for the 
presentation of additional evidence to show that the benefits should be 
continued at their present level. Unless otherwise provided in paragraph 
(i) of this section, if additional evidence is not received within that 
period, final adverse action will be taken and the award will be reduced 
or discontinued effective as specified under the provisions of 
Sec. Sec. 3.500 through 3.503 of this part.


(Authority: 38 U.S.C. 5112)

    (i) Predetermination hearings. (1) In the advance written notice 
concerning proposed actions under paragraphs (d) through (h) of this 
section, the beneficiary will be informed that he or she will have an 
opportunity for a predetermination hearing, provided that a request for 
such a hearing is received by VA within 30 days from the date of the 
notice. If a timely request is received, VA will notify the beneficiary 
in writing of the time and place of the hearing at least 10 days in 
advance of the scheduled hearing date. The 10 day

[[Page 182]]

advance notice may be waived by agreement between VA and the beneficiary 
or representative. The hearing will be conducted by VA personnel who did 
not participate in the proposed adverse action and who will bear the 
decision-making responsibility. If a predetermination hearing is timely 
requested, benefit payments shall be continued at the previously 
established level pending a final determination concerning the proposed 
action.
    (2) Following the predetermination procedures specified in this 
paragraph and paragraph (d), (e), (f), (g) or (h) of this section, 
whichever is applicable, final action will be taken. If a 
predetermination hearing was not requested or if the beneficiary failed 
without good cause to report for a scheduled predetermination hearing, 
the final action will be based solely upon the evidence of record. 
Examples of good cause include, but are not limited to, the illness or 
hospitalization of the claimant or beneficiary, death of an immediate 
family member, etc. If a predetermination hearing was conducted, the 
final action will be based on evidence and testimony adduced at the 
hearing as well as the other evidence of record including any additional 
evidence obtained following the hearing pursuant to necessary 
development. Whether or not a predetermination hearing was conducted, a 
written notice of the final action shall be issued to the beneficiary 
and his or her representative, setting forth the reasons therefor and 
the evidence upon which it is based. Where a reduction or discontinuance 
of benefits is found warranted following consideration of any additional 
evidence submitted, the effective date of such reduction or 
discontinuance shall be as follows:
    (i) Where reduction or discontinuance was proposed under the 
provisions of paragraph (d) or (e) of this section, the effective date 
of final action shall be the last day of the month in which a 60-day 
period from the date of notice to the beneficiary of the final action 
expires.
    (ii) Where reduction or discontinuance was proposed under the 
provisions of paragraphs (f) and (g) of this section, the effective date 
of final action shall be the last day of the month in which such action 
is approved.
    (iii) Where reduction or discontinuance was proposed under the 
provisions of paragraph (h) of this section, the effective date of final 
action shall be as specified under the provisions of Sec. Sec. 3.500 
through 3.503 of this part.

(Authority: 38 U.S.C. 5112)

    Cross References: Effective dates. See Sec. 3.400. Reductions and 
discontinuances. See Sec. 3.500. Protection; service connection. See 
Sec. 3.957.

[26 FR 1569, Feb. 24, 1961, as amended at 27 FR 11886, Dec. 1, 1962; 39 
FR 17222, May 14, 1974; 55 FR 13528, Apr. 11, 1990; 56 FR 65846, Dec. 
19, 1991; 57 FR 56993, Dec. 2, 1992; 62 FR 51278, Sept. 30, 1997; 66 FR 
21874, May 2, 2001; 67 FR 49586, July 31, 2002]



Sec. 3.106  Renouncement.

    (a) Any person entitled to pension, compensation, or dependency and 
indemnity compensation under any of the laws administered by the 
Department of Veterans Affairs may renounce his or her right to that 
benefit but may not renounce less than all of the component items which 
together comprise the total amount of the benefit to which the person is 
entitled nor any fixed monetary amounts less than the full amount of 
entitlement. The renouncement will be in writing over the person's 
signature. Upon receipt of such renouncement in the Department of 
Veterans Affairs, payment of such benefits and the right thereto will be 
terminated, and such person will be denied any and all rights thereto 
from such filing.


(Authority: 38 U.S.C. 5306(a))

    (b) The renouncement will not preclude the person from filing a new 
application for pension, compensation, or dependency and indemnity 
compensation at any future date. Such new application will be treated as 
an original application, and no payments will be made thereon for any 
period before the date such new application is received in the 
Department of Veterans Affairs.


(Authority: 38 U.S.C. 5306(b))

    (c) Notwithstanding the provisions of paragraph (b) of this section, 
if a new

[[Page 183]]

application for pension or parents' dependency and indemnity 
compensation is filed within one year after the date that the Department 
of Veterans Affairs receives a renouncement of that benefit, such 
application shall not be treated as an original application and benefits 
will be payable as if the renouncement had not occurred.


(Authority: 38 U.S.C. 5306(c))

    (d) The renouncement of dependency and indemnity compensation by one 
beneficiary will not serve to increase the rate payable to any other 
beneficiary in the same class.
    (e) The renouncement of dependency and indemnity compensation by a 
surviving spouse will not serve to vest title to this benefit in 
children under the age of 18 years or to increase the rate payable to a 
child or children over the age of 18 years.

[26 FR 1569, Feb. 24, 1961, as amended at 37 FR 5384, Mar. 15, 1972; 39 
FR 17222, May 14, 1974; 60 FR 18355, Apr. 11, 1995; 62 FR 5529, Feb. 6, 
1997]



Sec. 3.107  Awards where not all dependents apply.

    Except as provided in Sec. 3.251(a)(4), in any case where claim has 
not been filed by or on behalf of all dependents who may be entitled, 
the awards (original or amended) for those dependents who have filed 
claim will be made for all periods at the rates and in the same manner 
as though there were no other dependents. However, if the file reflects 
the existence of other dependents who have not filed claim and there is 
potential entitlement to benefits for a period prior to the date of 
filing claim, the award to a person who has filed claim will be made at 
the rate which would be payable if all dependents were receiving 
benefits. If at the expiration of the period allowed, claims have not 
been filed for such dependents, the full rate will be authorized for the 
first payee.

[29 FR 9564, July 15, 1964]



Sec. 3.108  State Department as agent of Department of Veterans Affairs.

    Diplomatic and consular officers of the Department of State are 
authorized to act as agents of the Department of Veterans Affairs and 
therefore a formal or informal claim or evidence submitted in support of 
a claim filed in a foreign country will be considered as filed in the 
Department of Veterans Affairs as of the date of receipt by the State 
Department representative.

    Cross Reference: Evidence from foreign countries. See Sec. 3.202.

[26 FR 1569, Feb. 24, 1961]



Sec. 3.109  Time limit.

    (a) Notice of time limit for filing evidence. (1) If a claimant's 
application is incomplete, the claimant will be notified of the evidence 
necessary to complete the application. If the evidence is not received 
within 1 year from the date of such notification, pension, compensation, 
or dependency and indemnity compensation may not be paid by reason of 
that application (38 U.S.C. 5103(a)). Information concerning the 
whereabouts of a person who has filed claim is not considered evidence.
    (2) The provisions of this paragraph are applicable to original 
applications, formal or informal, and to applications for increased 
benefits by reason of increased disability, age, or the existence of a 
dependent and to applications for reopening or resumption of payments. 
If substantiating evidence is required with respect to the veracity of a 
witness or the authenticity of documentary evidence timely filed, there 
will be allowed for the submission of such evidence 1 year from the date 
of the request therefor. However, any evidence to enlarge the proofs and 
evidence originally submitted is not so included.
    (b) Extension of time limit. Time limits within which claimants or 
beneficiaries are required to act to perfect a claim or challenge an 
adverse VA decision may be extended for good cause shown. Where an 
extension is requested after expiration of a time limit, the action 
required of the claimant or beneficiary must be taken concurrent with or 
prior to the filing of a request for extension of the time limit, and 
good cause must be shown as to why the required action could not have 
been taken during the original time period and could not have been taken 
sooner

[[Page 184]]

than it was. Denials of time limit extensions are separately appealable 
issues.

(Authority: 38 U.S.C. 501)

[26 FR 1569, Feb. 24, 1961, as amended at 26 FR 2231, Mar. 16, 1961; 29 
FR 1462, Jan. 29, 1964; 30 FR 133, Jan. 7, 1965; 55 FR 13529, Apr. 11, 
1990]



Sec. 3.110  Computation of time limit.

    (a) In computing the time limit for any action required of a 
claimant or beneficiary, including the filing of claims or evidence 
requested by VA, the first day of the specified period will be excluded 
and the last day included. This rule is applicable in cases in which the 
time limit expires on a workday. Where the time limit would expire on a 
Saturday, Sunday, or holiday, the next succeeding workday will be 
included in the computation.
    (b) The first day of the specified period referred to in paragraph 
(a) of this section shall be the date of mailing of notification to the 
claimant or beneficiary of the action required and the time limit 
therefor. The date of the letter of notification shall be considered the 
date of mailing for purposes of computing time limits. As to appeals, 
see Sec. Sec. 20.302 and 20.305 of this chapter.

(Authority: 38 U.S.C. 501)

[55 FR 13529, Apr. 11, 1990, as amended at 58 FR 32443, June 10, 1993]



Sec. 3.111  [Reserved]



Sec. 3.112  Fractions of one cent.

    In all cases where the amount to be paid under any award involves a 
fraction of a cent, the fractional part will be excluded.

[26 FR 1570, Feb. 24, 1961]



Sec. 3.114  Change of law or Department of Veterans Affairs issue.

    (a) Effective date of award. Where pension, compensation, dependency 
and indemnity compensation, or a monetary allowance under 38 U.S.C. 
chapter 18 for an individual who is a child of a Vietnam veteran is 
awarded or increased pursuant to a liberalizing law, or a liberalizing 
VA issue approved by the Secretary or by the Secretary's direction, the 
effective date of such award or increase shall be fixed in accordance 
with the facts found, but shall not be earlier than the effective date 
of the act or administrative issue. Where pension, compensation, 
dependency and indemnity compensation, or a monetary allowance under 38 
U.S.C. chapter 18 for an individual who is a child of a Vietnam veteran 
is awarded or increased pursuant to a liberalizing law or VA issue which 
became effective on or after the date of its enactment or issuance, in 
order for a claimant to be eligible for a retroactive payment under the 
provisions of this paragraph the evidence must show that the claimant 
met all eligibility criteria for the liberalized benefit on the 
effective date of the liberalizing law or VA issue and that such 
eligibility existed continuously from that date to the date of claim or 
administrative determination of entitlement. The provisions of this 
paragraph are applicable to original and reopened claims as well as 
claims for increase.
    (1) If a claim is reviewed on the initiative of VA within 1 year 
from the effective date of the law or VA issue, or at the request of a 
claimant received within 1 year from that date, benefits may be 
authorized from the effective date of the law or VA issue.
    (2) If a claim is reviewed on the initiative of VA more than 1 year 
after the effective date of the law or VA issue, benefits may be 
authorized for a period of 1 year prior to the date of administrative 
determination of entitlement.
    (3) If a claim is reviewed at the request of the claimant more than 
1 year after the effective date of the law or VA issue, benefits may be 
authorized for a period of 1 year prior to the date of receipt of such 
request.


(Authority: 38 U.S.C. 1822, 5110(g))

    (b) Discontinuance of benefits. Where the reduction or 
discontinuance of an award is in order because of a change in law or a 
Department of Veterans Affairs issue, or because of a change in 
interpretation of a law or Department of Veterans Affairs issue, the 
payee will be notified at his or her latest address of record of the 
contemplated action and furnished detailed reasons therefor, and will be 
given 60 days for

[[Page 185]]

the presentation of additional evidence. If additional evidence is not 
received within that period, the award will be reduced or discontinued 
effective the last day of the month in which the 60-day period expired.

(Authority: 38 U.S.C. 5112(b)(6))

[27 FR 11886, Dec. 1, 1962, as amended at 55 FR 13529, Apr. 11, 1990; 62 
FR 17706, Apr. 11, 1997; 65 FR 35282, June 2, 2000; 67 FR 49586, July 
31, 2002]



Sec. 3.115  Access to financial records.

    (a) The Secretary of Veterans Affairs may request from a financial 
institution the names and addresses of its customers. Each such request, 
however, shall include a certification that the information is necessary 
for the proper administration of benefits programs under the laws 
administered by the Secretary, and cannot be obtained by a reasonable 
search of records and information of the Department of Veterans Affairs.
    (b) Information received pursuant to a request referred to in 
paragraph (a) of this section shall not be used for any purpose other 
than the administration of benefits programs under the laws administered 
by the Secretary if the disclosure of that information would otherwise 
be prohibited by any provision of the Right to Financial Privacy Act of 
1978 (12 U.S.C. 3401 through 3422).

(Authority: 38 U.S.C. 5319)

[58 FR 32445, June 10, 1993]

                                 Claims



Sec. 3.150  Forms to be furnished.

    (a) Upon request made in person or in writing by any person applying 
for benefits under the laws administered by the Department of Veterans 
Affairs, the appropriate application form will be furnished.


(Authority: 38 U.S.C. 5102)

    (b) Upon receipt of notice of death of a veteran, the appropriate 
application form will be forwarded for execution by or on behalf of any 
dependent who has apparent entitlement to pension, compensation, or 
dependency and indemnity compensation. If it is not indicated that any 
person would be entitled to such benefits, but there is payable an 
accrued benefit not paid during the veteran's lifetime, the appropriate 
application form will be forwarded to the preferred dependent. Notice of 
the time limit will be included in letters forwarding applications for 
benefits.
    (c) When disability or death is due to Department of Veterans 
Affairs hospital treatment, training, medical or surgical treatment, or 
examination, a specific application for benefits will not be initiated.

    Cross Reference: Extension of time limit. See Sec. 3.109(b).

[26 FR 1570, Feb. 14, 1961, as amended at 30 FR 133, Jan. 7, 1965]



Sec. 3.151  Claims for disability benefits.

    (a) General. A specific claim in the form prescribed by the 
Secretary must be filed in order for benefits to be paid to any 
individual under the laws administered by VA. (38 U.S.C. 5101(a)). A 
claim by a veteran for compensation may be considered to be a claim for 
pension; and a claim by a veteran for pension may be considered to be a 
claim for compensation. The greater benefit will be awarded, unless the 
claimant specifically elects the lesser benefit.
    (b) Retroactive disability pension claims. Where disability pension 
entitlement is established based on a claim received by VA on or after 
October 1, 1984, the pension award may not be effective prior to the 
date of receipt of the pension claim unless the veteran specifically 
claims entitlement to retroactive benefits. The claim for retroactivity 
may be filed separately or included in the claim for disability pension, 
but it must be received by VA within one year from the date on which the 
veteran became permanently and totally disabled. Additional requirements 
for entitlement to a retroactive pension award are contained in Sec. 
3.400(b) of this part.

    Cross Reference: Informal claims. See Sec. 3.155(b).

(Authority: 38 U.S.C 5110(b)(3))

[50 FR 25981, June 24, 1985]



Sec. 3.152  Claims for death benefits.

    (a) A specific claim in the form prescribed by the Secretary (or 
jointly

[[Page 186]]

with the Commissioner of Social Security, as prescribed by Sec. 3.153) 
must be filed in order for death benefits to be paid to any individual 
under the laws administered by VA. (See Sec. 3.400(c) concerning 
effective dates of awards.)


(Authority: 38 U.S.C. 5101(a))

    (b)(1) A claim by a surviving spouse or child for compensation or 
dependency and indemnity compensation will also be considered to be a 
claim for death pension and accrued benefits, and a claim by a surviving 
spouse or child for death pension will be considered to be a claim for 
death compensation or dependency and indemnity compensation and accrued 
benefits.


(Authority: 38 U.S.C. 5101(b)(1))

    (2) A claim by a parent for compensation or dependency and indemnity 
compensation will also be considered to be a claim for accrued benefits.


(Authority: 38 U.S.C. 5101(b)(2))

    (c)(1) Where a child's entitlement to dependency and indemnity 
compensation arises by reason of termination of a surviving spouse's 
right to dependency and indemnity compensation or by reason of attaining 
the age of 18 years, a claim will be required. (38 U.S.C. 5110(e).) (See 
paragraph (c)(4) of this section.) Where the award to the surviving 
spouse is terminated by reason of her or his death, a claim for the 
child will be considered a claim for any accrued benefits which may be 
payable.
    (2) A claim filed by a surviving spouse who does not have 
entitlement will be accepted as a claim for a child or children in her 
or his custody named in the claim.
    (3) Where a claim of a surviving spouse is disallowed for any reason 
whatsoever and where evidence requested in order to determine 
entitlement from a child or children named in the surviving spouse's 
claim is submitted within 1 year from the date of request, requested 
either before or after disallowance of the surviving spouse's claim, an 
award for the child or children will be made as though the disallowed 
claim had been filed solely on their behalf. Otherwise, payments may not 
be made for the child or children for any period prior to the date of 
receipt of a new claim.
    (4) Where payments of pension, compensation or dependency and 
indemnity compensation to a surviving spouse have been discontinued 
because of remarriage or death, or a child becomes eligible for 
dependency and indemnity compensation by reason of attaining the age of 
18 years, and any necessary evidence is submitted within 1 year from 
date of request, an award for the child or children named in the 
surviving spouse's claim will be made on the basis of the surviving 
spouse's claim having been converted to a claim on behalf of the child. 
Otherwise, payments may not be made for any period prior to the date of 
receipt of a new claim.

(Authority: 38 U.S.C 501)

    Cross References: State Department as agent of Department of 
Veterans Affairs. See Sec. 3.108. Change in status of dependents. See 
Sec. 3.651.

[50 FR 25981, June 24, 1985, as amended at 71 FR 44918, Aug. 8, 2006]



Sec. 3.153  Claims filed with Social Security.

    An application on a form jointly prescribed by the Secretary and the 
Commissioner of Social Security filed with the Social Security 
Administration on or after January 1, 1957, will be considered a claim 
for death benefits, and to have been received in the Department of 
Veterans Affairs as of the date of receipt in Social Security 
Administration. The receipt of such an application (or copy thereof) by 
the Department of Veterans Affairs will not preclude a request for any 
necessary evidence.

(Authority: 38 U.S.C. 5105)

[26 FR 1570, Feb. 24, 1961, as amended at 71 FR 44918, Aug. 8, 2006]



Sec. 3.154  Injury due to hospital treatment, etc.

    VA may accept as a claim for benefits under 38 U.S.C. 1151 and Sec. 
3.361 any communication in writing indicating an intent to file a claim 
for disability compensation or dependency and indemnity compensation 
under the laws governing entitlement to veterans' benefits for 
disability or death due to VA hospital care, medical or surgical

[[Page 187]]

treatment, examination, training and rehabilitation services, or 
compensated work therapy program, whether such communication is 
contained in a formal claim for pension, compensation, or dependency and 
indemnity compensation or in any other document.

(Authority: 38 U.S.C. 1151)

    Cross references: Effective dates. See Sec. 3.400(i). Disability or 
death due to hospitalization, etc. See Sec. Sec. 3.358, 3.361 and 
3.800.

[69 FR 46432, Aug. 3, 2004]



Sec. 3.155  Informal claims.

    (a) Any communication or action, indicating an intent to apply for 
one or more benefits under the laws administered by the Department of 
Veterans Affairs, from a claimant, his or her duly authorized 
representative, a Member of Congress, or some person acting as next 
friend of a claimant who is not sui juris may be considered an informal 
claim. Such informal claim must identify the benefit sought. Upon 
receipt of an informal claim, if a formal claim has not been filed, an 
application form will be forwarded to the claimant for execution. If 
received within 1 year from the date it was sent to the claimant, it 
will be considered filed as of the date of receipt of the informal 
claim.
    (b) A communication received from a service organization, an 
attorney, or agent may not be accepted as an informal claim if a power 
of attorney was not executed at the time the communication was written.
    (c) When a claim has been filed which meets the requirements of 
Sec. 3.151 or Sec. 3.152, an informal request for increase or 
reopening will be accepted as a claim.

    Cross References: State Department as agent of VA. See Sec. 3.108. 
Report of examination or hospitalization--as claim for increase or to 
reopen. See Sec. 3.157.

[26 FR 1570, Feb. 24, 1961, as amended at 52 FR 27340, July 21, 1987]



Sec. 3.156  New and material evidence.

    (a) General. A claimant may reopen a finally adjudicated claim by 
submitting new and material evidence. New evidence means existing 
evidence not previously submitted to agency decisionmakers. Material 
evidence means existing evidence that, by itself or when considered with 
previous evidence of record, relates to an unestablished fact necessary 
to substantiate the claim. New and material evidence can be neither 
cumulative nor redundant of the evidence of record at the time of the 
last prior final denial of the claim sought to be reopened, and must 
raise a reasonable possibility of substantiating the claim.


(Authority: 38 U.S.C. 501, 5103A(f), 5108)

    (b) Pending claim. New and material evidence received prior to the 
expiration of the appeal period, or prior to the appellate decision if a 
timely appeal has been filed (including evidence received prior to an 
appellate decision and referred to the agency of original jurisdiction 
by the Board of Veterans Appeals without consideration in that decision 
in accordance with the provisions of Sec. 20.1304(b)(1) of this 
chapter), will be considered as having been filed in connection with the 
claim which was pending at the beginning of the appeal period.


(Authority: 38 U.S.C. 501)

    (c) Service department records. (1) Notwithstanding any other 
section in this part, at any time after VA issues a decision on a claim, 
if VA receives or associates with the claims file relevant official 
service department records that existed and had not been associated with 
the claims file when VA first decided the claim, VA will reconsider the 
claim, notwithstanding paragraph (a) of this section. Such records 
include, but are not limited to:
    (i) Service records that are related to a claimed in-service event, 
injury, or disease, regardless of whether such records mention the 
veteran by name, as long as the other requirements of paragraph (c) of 
this section are met;
    (ii) Additional service records forwarded by the Department of 
Defense or the service department to VA any time after VA's original 
request for service records; and
    (iii) Declassified records that could not have been obtained because 
the records were classified when VA decided the claim.
    (2) Paragraph (c)(1) of this section does not apply to records that 
VA

[[Page 188]]

could not have obtained when it decided the claim because the records 
did not exist when VA decided the claim, or because the claimant failed 
to provide sufficient information for VA to identify and obtain the 
records from the respective service department, the Joint Services 
Records Research Center, or from any other official source.
    (3) An award made based all or in part on the records identified by 
paragraph (c)(1) of this section is effective on the date entitlement 
arose or the date VA received the previously decided claim, whichever is 
later, or such other date as may be authorized by the provisions of this 
part applicable to the previously decided claim.
    (4) A retroactive evaluation of disability resulting from disease or 
injury subsequently service connected on the basis of the new evidence 
from the service department must be supported adequately by medical 
evidence. Where such records clearly support the assignment of a 
specific rating over a part or the entire period of time involved, a 
retroactive evaluation will be assigned accordingly, except as it may be 
affected by the filing date of the original claim.


(Authority: 38 U.S.C. 501(a))

    Cross References: Effective dates--general. See Sec. 3.400. 
Correction of military records. See Sec. 3.400(g).

[27 FR 11887, Dec. 1, 1962, as amended at 55 FR 20148, May 15, 1990; 55 
FR 52275, Dec. 21, 1990; 58 FR 32443, June 10, 1993; 66 FR 45630, Aug. 
29, 2001; 71 FR 52457, Sept. 6, 2006]



Sec. 3.157  Report of examination or hospitalization as claim for increase or to reopen.

    (a) General. Effective date of pension or compensation benefits, if 
otherwise in order, will be the date of receipt of a claim or the date 
when entitlement arose, whichever is the later. A report of examination 
or hospitalization which meets the requirements of this section will be 
accepted as an informal claim for benefits under an existing law or for 
benefits under a liberalizing law or Department of Veterans Affairs 
issue, if the report relates to a disability which may establish 
entitlement. Acceptance of a report of examination or treatment as a 
claim for increase or to reopen is subject to the requirements of Sec. 
3.114 with respect to action on Department of Veterans Affairs 
initiative or at the request of the claimant and the payment of 
retroactive benefits from the date of the report or for a period of 1 
year prior to the date of receipt of the report.


(Authority: 38 U.S.C. 5110(a))

    (b) Claim. Once a formal claim for pension or compensation has been 
allowed or a formal claim for compensation disallowed for the reason 
that the service-connected disability is not compensable in degree, 
receipt of one of the following will be accepted as an informal claim 
for increased benefits or an informal claim to reopen. In addition, 
receipt of one of the following will be accepted as an informal claim in 
the case of a retired member of a uniformed service whose formal claim 
for pension or compensation has been disallowed because of receipt of 
retirement pay. The evidence listed will also be accepted as an informal 
claim for pension previously denied for the reason the disability was 
not permanently and totally disabling.
    (1) Report of examination or hospitalization by Department of 
Veterans Affairs or uniformed services. The date of outpatient or 
hospital examination or date of admission to a VA or uniformed services 
hospital will be accepted as the date of receipt of a claim. The date of 
a uniformed service examination which is the basis for granting 
severance pay to a former member of the Armed Forces on the temporary 
disability retired list will be accepted as the date of receipt of 
claim. The date of admission to a non-VA hospital where a veteran was 
maintained at VA expense will be accepted as the date of receipt of a 
claim, if VA maintenance was previously authorized; but if VA 
maintenance was authorized subsequent to admission, the date VA received 
notice of admission will be accepted. The provisions of this paragraph 
apply only when such reports relate to examination or treatment of a 
disability for which service-connection has previously been established 
or when a claim specifying the benefit sought is received within one 
year from

[[Page 189]]

the date of such examination, treatment or hospital admission.


(Authority: 38 U.S.C. 501)

    (2) Evidence from a private physician or layman. The date of receipt 
of such evidence will be accepted when the evidence furnished by or in 
behalf of the claimant is within the competence of the physician or lay 
person and shows the reasonable probability of entitlement to benefits.
    (3) State and other institutions. When submitted by or on behalf of 
the veteran and entitlement is shown, date of receipt by the Department 
of Veterans Affairs of examination reports, clinical records, and 
transcripts of records will be accepted as the date of receipt of a 
claim if received from State, county, municipal, recognized private 
institutions, or other Government hospitals (except those described in 
paragraph (b)(1) of this section). These records must be authenticated 
by an appropriate official of the institution. Benefits will be granted 
if the records are adequate for rating purposes; otherwise findings will 
be verified by official examination. Reports received from private 
institutions not listed by the American Hospital Association must be 
certified by the Chief Medical Officer of the Department of Veterans 
Affairs or physician designee.

[26 FR 1571, Feb. 24, 1961, as amended at 27 FR 4421, May 9, 1962; 31 FR 
12055, Sept. 15, 1966; 40 FR 56434, Dec. 3, 1975; 52 FR 27340, July 21, 
1987; 60 FR 27409, May 24, 1995]



Sec. 3.158  Abandoned claims.

    (a) General. Except as provided in Sec. 3.652 of this part, where 
evidence requested in connection with an original claim, a claim for 
increase or to reopen or for the purpose of determining continued 
entitlement is not furnished within 1 year after the date of request, 
the claim will be considered abandoned. After the expiration of 1 year, 
further action will not be taken unless a new claim is received. Should 
the right to benefits be finally established, pension, compensation, 
dependency and indemnity compensation, or monetary allowance under the 
provisions of 38 U.S.C. chapter 18 based on such evidence shall commence 
not earlier than the date of filing the new claim.


(Authority: 38 U.S.C. 501)

    (b) Department of Veterans Affairs examinations. Where the veteran 
fails without adequate reason to respond to an order to report for 
Department of Veterans Affairs examination within 1 year from the date 
of request and payments have been discontinued, the claim for such 
benefits will be considered abandoned.
    (c) Disappearance. Where payments of pension, compensation, 
dependency and indemnity compensation, or monetary allowance under the 
provisions of 38 U.S.C. chapter 18 have not been made or have been 
discontinued because a payee's present whereabouts is unknown, payments 
will be resumed effective the day following the date of last payment if 
entitlement is otherwise established, upon receipt of a valid current 
address.

    Cross References: Periodic certification of continued eligibility. 
See Sec. 3.652. Failure to report for VA examination. See Sec. 3.655. 
Disappearance of veteran. See Sec. 3.656.

[27 FR 11887, Dec. 1, 1962, as amended at 28 FR 13362, Dec. 10, 1963; 52 
FR 43063, Nov. 9, 1987; 62 FR 51278, Sept. 30, 1997; 67 FR 49586, July 
31, 2002]



Sec. 3.159  Department of Veterans Affairs assistance in developing claims.

    (a) Definitions. For purposes of this section, the following 
definitions apply:
    (1) Competent medical evidence means evidence provided by a person 
who is qualified through education, training, or experience to offer 
medical diagnoses, statements, or opinions. Competent medical evidence 
may also mean statements conveying sound medical principles found in 
medical treatises. It would also include statements contained in 
authoritative writings such as medical and scientific articles and 
research reports or analyses.
    (2) Competent lay evidence means any evidence not requiring that the 
proponent have specialized education, training, or experience. Lay 
evidence is competent if it is provided by a person who has knowledge of 
facts or circumstances and conveys matters that

[[Page 190]]

can be observed and described by a lay person.
    (3) Substantially complete application means an application 
containing the claimant's name; his or her relationship to the veteran, 
if applicable; sufficient service information for VA to verify the 
claimed service, if applicable; the benefit claimed and any medical 
condition(s) on which it is based; the claimant's signature; and in 
claims for nonservice-connected disability or death pension and parents' 
dependency and indemnity compensation, a statement of income.
    (4) For purposes of paragraph (c)(4)(i) of this section, event means 
one or more incidents associated with places, types, and circumstances 
of service giving rise to disability.
    (5) Information means non-evidentiary facts, such as the claimant's 
Social Security number or address; the name and military unit of a 
person who served with the veteran; or the name and address of a medical 
care provider who may have evidence pertinent to the claim.
    (b) VA's duty to notify claimants of necessary information or 
evidence. (1) When VA receives a complete or substantially complete 
application for benefits, it will notify the claimant of any information 
and medical or lay evidence that is necessary to substantiate the claim 
(hereafter in this paragraph referred to as the ``notice''). In the 
notice, VA will inform the claimant which information and evidence, if 
any, that the claimant is to provide to VA and which information and 
evidence, if any, that VA will attempt to obtain on behalf of the 
claimant. The information and evidence that the claimant is informed 
that the claimant is to provide must be provided within one year of the 
date of the notice. If the claimant has not responded to the notice 
within 30 days, VA may decide the claim prior to the expiration of the 
one-year period based on all the information and evidence contained in 
the file, including information and evidence it has obtained on behalf 
of the claimant and any VA medical examinations or medical opinions. If 
VA does so, however, and the claimant subsequently provides the 
information and evidence within one year of the date of the notice, VA 
must readjudicate the claim.


(Authority: 38 U.S.C. 5103)

    (2) If VA receives an incomplete application for benefits, it will 
notify the claimant of the information necessary to complete the 
application and will defer assistance until the claimant submits this 
information.


(Authority: 38 U.S.C. 5102(b), 5103A(3))

    (3) No duty to provide the notice described in paragraph (b)(1) of 
this section arises:
    (i) Upon receipt of a Notice of Disagreement; or
    (ii) When, as a matter of law, entitlement to the benefit claimed 
cannot be established.


(Authority: 38 U.S.C. 5103(a), 5103A(a)(2))

    (c) VA's duty to assist claimants in obtaining evidence. Upon 
receipt of a substantially complete application for benefits, VA will 
make reasonable efforts to help a claimant obtain evidence necessary to 
substantiate the claim. In addition, VA will give the assistance 
described in paragraphs (c)(1), (c)(2), and (c)(3) to an individual 
attempting to reopen a finally decided claim. VA will not pay any fees 
charged by a custodian to provide records requested.
    (1) Obtaining records not in the custody of a Federal department or 
agency. VA will make reasonable efforts to obtain relevant records not 
in the custody of a Federal department or agency, to include records 
from State or local governments, private medical care providers, current 
or former employers, and other non-Federal governmental sources. Such 
reasonable efforts will generally consist of an initial request for the 
records and, if the records are not received, at least one follow-up 
request. A follow-up request is not required if a response to the 
initial request indicates that the records sought do not exist or that a 
follow-up request for the records would be futile. If VA receives 
information showing that subsequent requests to this or another 
custodian could result in obtaining the records sought, then reasonable 
efforts will include an initial request and, if

[[Page 191]]

the records are not received, at least one follow-up request to the new 
source or an additional request to the original source.
    (i) The claimant must cooperate fully with VA's reasonable efforts 
to obtain relevant records from non-Federal agency or department 
custodians. The claimant must provide enough information to identify and 
locate the existing records, including the person, company, agency, or 
other custodian holding the records; the approximate time frame covered 
by the records; and, in the case of medical treatment records, the 
condition for which treatment was provided.
    (ii) If necessary, the claimant must authorize the release of 
existing records in a form acceptable to the person, company, agency, or 
other custodian holding the records.


(Authority: 38 U.S.C. 5103A(b))

    (2) Obtaining records in the custody of a Federal department or 
agency. VA will make as many requests as are necessary to obtain 
relevant records from a Federal department or agency. These records 
include but are not limited to military records, including service 
medical records; medical and other records from VA medical facilities; 
records from non-VA facilities providing examination or treatment at VA 
expense; and records from other Federal agencies, such as the Social 
Security Administration. VA will end its efforts to obtain records from 
a Federal department or agency only if VA concludes that the records 
sought do not exist or that further efforts to obtain those records 
would be futile. Cases in which VA may conclude that no further efforts 
are required include those in which the Federal department or agency 
advises VA that the requested records do not exist or the custodian does 
not have them.
    (i) The claimant must cooperate fully with VA's reasonable efforts 
to obtain relevant records from Federal agency or department custodians. 
If requested by VA, the claimant must provide enough information to 
identify and locate the existing records, including the custodian or 
agency holding the records; the approximate time frame covered by the 
records; and, in the case of medical treatment records, the condition 
for which treatment was provided. In the case of records requested to 
corroborate a claimed stressful event in service, the claimant must 
provide information sufficient for the records custodian to conduct a 
search of the corroborative records.
    (ii) If necessary, the claimant must authorize the release of 
existing records in a form acceptable to the custodian or agency holding 
the records.


(Authority: 38 U.S.C. 5103A(b))

    (3) Obtaining records in compensation claims. In a claim for 
disability compensation, VA will make efforts to obtain the claimant's 
service medical records, if relevant to the claim; other relevant 
records pertaining to the claimant's active military, naval or air 
service that are held or maintained by a governmental entity; VA medical 
records or records of examination or treatment at non-VA facilities 
authorized by VA; and any other relevant records held by any Federal 
department or agency. The claimant must provide enough information to 
identify and locate the existing records including the custodian or 
agency holding the records; the approximate time frame covered by the 
records; and, in the case of medical treatment records, the condition 
for which treatment was provided.


(Authority: 38 U.S.C. 5103A(c))

    (4) Providing medical examinations or obtaining medical opinions. 
(i) In a claim for disability compensation, VA will provide a medical 
examination or obtain a medical opinion based upon a review of the 
evidence of record if VA determines it is necessary to decide the claim. 
A medical examination or medical opinion is necessary if the information 
and evidence of record does not contain sufficient competent medical 
evidence to decide the claim, but:
    (A) Contains competent lay or medical evidence of a current 
diagnosed disability or persistent or recurrent symptoms of disability;
    (B) Establishes that the veteran suffered an event, injury or 
disease in service, or has a disease or symptoms of a disease listed in 
Sec. 3.309, Sec. 3.313, Sec. 3.316, and Sec. 3.317 manifesting 
during an

[[Page 192]]

applicable presumptive period provided the claimant has the required 
service or triggering event to qualify for that presumption; and
    (C) Indicates that the claimed disability or symptoms may be 
associated with the established event, injury, or disease in service or 
with another service-connected disability.
    (ii) Paragraph (4)(i)(C) could be satisfied by competent evidence 
showing post-service treatment for a condition, or other possible 
association with military service.
    (iii) Paragraph (c)(4) applies to a claim to reopen a finally 
adjudicated claim only if new and material evidence is presented or 
secured.


(Authority: 38 U.S.C. 5103A(d))

    (d) Circumstances where VA will refrain from or discontinue 
providing assistance. VA will refrain from providing assistance in 
obtaining evidence for a claim if the substantially complete application 
for benefits indicates that there is no reasonable possibility that any 
assistance VA would provide to the claimant would substantiate the 
claim. VA will discontinue providing assistance in obtaining evidence 
for a claim if the evidence obtained indicates that there is no 
reasonable possibility that further assistance would substantiate the 
claim. Circumstances in which VA will refrain from or discontinue 
providing assistance in obtaining evidence include, but are not limited 
to:
    (1) The claimant's ineligibility for the benefit sought because of 
lack of qualifying service, lack of veteran status, or other lack of 
legal eligibility;
    (2) Claims that are inherently incredible or clearly lack merit; and
    (3) An application requesting a benefit to which the claimant is not 
entitled as a matter of law.


(Authority: 38 U.S.C. 5103A(a)(2))

    (e) Duty to notify claimant of inability to obtain records. (1) If 
VA makes reasonable efforts to obtain relevant non-Federal records but 
is unable to obtain them, or after continued efforts to obtain Federal 
records concludes that it is reasonably certain they do not exist or 
further efforts to obtain them would be futile, VA will provide the 
claimant with oral or written notice of that fact. VA will make a record 
of any oral notice conveyed to the claimant. For non-Federal records 
requests, VA may provide the notice at the same time it makes its final 
attempt to obtain the relevant records. In either case, the notice must 
contain the following information:
    (i) The identity of the records VA was unable to obtain;
    (ii) An explanation of the efforts VA made to obtain the records;
    (iii) A description of any further action VA will take regarding the 
claim, including, but not limited to, notice that VA will decide the 
claim based on the evidence of record unless the claimant submits the 
records VA was unable to obtain; and
    (iv) A notice that the claimant is ultimately responsible for 
providing the evidence.
    (2) If VA becomes aware of the existence of relevant records before 
deciding the claim, VA will notify the claimant of the records and 
request that the claimant provide a release for the records. If the 
claimant does not provide any necessary release of the relevant records 
that VA is unable to obtain, VA will request that the claimant obtain 
the records and provide them to VA.


(Authority: 38 U.S.C. 5103A(b)(2))

    (f) For the purpose of the notice requirements in paragraphs (b) and 
(e) of this section, notice to the claimant means notice to the claimant 
or his or her fiduciary, if any, as well as to his or her 
representative, if any.


(Authority: 38 U.S.C. 5102(b), 5103(a))

    (g) The authority recognized in subsection (g) of 38 U.S.C. 5103A is 
reserved to the sole discretion of the Secretary and will be 
implemented, when deemed appropriate by the Secretary, through the 
promulgation of regulations.


(Authority: 38 U.S.C. 5103A(g))


[66 FR 45630, Aug. 29, 2001, as amended at 73 FR 23356, Apr. 30, 2008]

[[Page 193]]



Sec. 3.160  Status of claims.

    The following definitions are applicable to claims for pension, 
compensation, and dependency and indemnity compensation.
    (a) Informal claim. See Sec. 3.155.
    (b) Original claim. An initial formal application on a form 
prescribed by the Secretary. (See Sec. Sec. 3.151, 3.152).
    (c) Pending claim. An application, formal or informal, which has not 
been finally adjudicated.
    (d) Finally adjudicated claim. An application, formal or informal, 
which has been allowed or disallowed by the agency of original 
jurisdiction, the action having become final by the expiration of 1 year 
after the date of notice of an award or disallowance, or by denial on 
appellate review, whichever is the earlier. (See Sec. Sec. 20.1103 and 
20.1104 of this chapter.)
    (e) Reopened claim. Any application for a benefit received after 
final disallowance of an earlier claim, or any application based on 
additional evidence or a request for a personal hearing submitted more 
than 90 days following notification to the appellant of the 
certification of an appeal and transfer of applicable records to the 
Board of Veterans Appeals which was not considered by the Board in its 
decision and was referred to the agency of original jurisdiction for 
consideration as provided in Sec. 20.1304(b)(1) of this chapter.


(Authority: 38 U.S.C. 501)

    (f) Claim for increase. Any application for an increase in rate of a 
benefit being paid under a current award, or for resumption of payments 
previously discontinued.

[27 FR 11887, Dec. 1, 1962, as amended at 31 FR 12056, Sept. 15, 1966; 
55 FR 20148, May 15, 1990; 58 FR 32445, June 10, 1993]

                          Evidence Requirements



Sec. 3.200  Testimony certified or under oath.

    (a) All oral testimony presented by claimants and witnesses on their 
behalf before any rating or authorization body will be under oath or 
affirmation. (See Sec. 3.103(c).)
    (b) All written testimony submitted by the claimant or in his or her 
behalf for the purpose of establishing a claim for service connection 
will be certified or under oath or affirmation. This includes records, 
examination reports, and transcripts material to the issue received by 
the Department of Veterans Affairs at the instance of the claimant or in 
his or her behalf or requested by the Department of Veterans Affairs 
from State, county, municipal, recognized private institutions, and 
contract hospitals.

[40 FR 36329, Aug. 20, 1975]



Sec. 3.201  Exchange of evidence; Social Security and Department of Veterans Affairs.

    (a) A claimant for dependency and indemnity compensation may elect 
to furnish to the Department of Veterans Affairs in support of that 
claim copies of evidence which was previously furnished to the Social 
Security Administration or to have the Department of Veterans Affairs 
obtain such evidence from the Social Security Administration. For the 
purpose of determining the earliest effective date for payment of 
dependency and indemnity compensation, such evidence will be deemed to 
have been received by the Department of Veterans Affairs on the date it 
was received by the Social Security Administration.
    (b) A copy or certification of evidence filed in the Department of 
Veterans Affairs in support of a claim for dependency and indemnity 
compensation will be furnished the Social Security Administration upon 
request from the agency.

(Authority: 38 U.S.C. 501(a) and 5105)

    Cross Reference: Claims filed with Social Security. See Sec. 3.153.

[26 FR 1571, Feb. 24, 1961, as amended at 58 FR 25562, Apr. 27, 1993]



Sec. 3.202  Evidence from foreign countries.

    (a) Except as provided in paragraph (b) of this section, where an 
affidavit or other document is required to be executed under oath before 
an official in a foreign country, the signature of that official must be 
authenticated by a United States Consular Officer in that

[[Page 194]]

jurisdiction or by the State Department. Where the United States has no 
consular representative in a foreign country, such authentication may be 
made as follows:
    (1) By a consular agent of a friendly government whereupon the 
signature and seal of the official of the friendly government may be 
authenticated by the State Department; or
    (2) By the nearest American consul who will attach a certificate 
showing the result of the investigation concerning its authenticity.
    (b) Authentication will not be required: (1) On documents approved 
by the Deputy Minister of Veterans Affairs, Department of Veterans 
Affairs, Ottawa, Canada: or
    (2) When it is indicated that the attesting officer is authorized to 
administer oaths for general purposes and the document bears his or her 
signature and seal; or
    (3) When the document is executed before a Department of Veterans 
Affairs employee authorized to administer oaths; or
    (4) When a copy of a public or church record from any foreign 
country purports to establish birth, adoption, marriage, annulment, 
divorce, or death, provided it bears the signature and seal of the 
custodian of such record and there is no conflicting evidence in the 
file which would serve to create doubt as to the correctness of the 
record; or
    (5) When a copy of the public or church record from one of the 
countries comprising the United Kingdom, namely: England, Scotland, 
Wales, or Northern Ireland, purports to establish birth, marriage, or 
death, provided it bears the signature or seal or stamp of the custodian 
of such record and there is no evidence which would serve to create 
doubt as to the correctness of the records; or
    (6) When affidavits prepared in the Republic of the Philippines are 
certified by a Department of Veterans Affairs representative located in 
the Philippines having authority to administer oaths.
    (c) Photocopies of original documents meeting the requirements of 
this section will be accepted if they satisfy the requirements of Sec. 
3.204 of this part.

(Authority: 38 U.S.C. 501)

    Cross Reference: State Department as agent of Department of Veterans 
Affairs. See Sec. 3.108.

[26 FR 1571, Feb. 24, 1961, as amended at 40 FR 36329, Aug. 20, 1975; 52 
FR 19348, May 22, 1987; 59 FR 46338, Sept. 8, 1994]



Sec. 3.203  Service records as evidence of service and character of discharge.

    (a) Evidence submitted by a claimant. For the purpose of 
establishing entitlement to pension, compensation, dependency and 
indemnity compensation or burial benefits the Department of Veterans 
Affairs may accept evidence of service submitted by a claimant (or sent 
directly to the Department of Veterans Affairs by the service 
department), such as a DD Form 214, Certificate of Release or Discharge 
from Active Duty, or original Certificate of Discharge, without 
verification from the appropriate service department if the evidence 
meets the following conditions:
    (1) The evidence is a document issued by the service department. A 
copy of an original document is acceptable if the copy was issued by the 
service department or if the copy was issued by a public custodian of 
records who certifies that it is a true and exact copy of the document 
in the custodian's custody or, if the copy was submitted by an 
accredited agent, attorney or service organization representative who 
has successfully completed VA-prescribed training on military records, 
and who certifies that it is a true and exact copy of either an original 
document or of a copy issued by the service department or a public 
custodian of records; and
    (2) The document contains needed information as to length, time and 
character of service; and
    (3) In the opinion of the Department of Veterans Affairs the 
document is genuine and the information contained in it is accurate.
    (b) Additional requirements for pension claimants. In addition to 
meeting the requirements of paragraph (a) of this section, a document 
submitted to establish a creditable period of wartime service for 
pension entitlement may be

[[Page 195]]

accepted without verification if the document (or other evidence of 
record) shows:
    (1) Service of 4 months or more; or
    (2) Discharge for disability incurred in line of duty; or
    (3) Ninety days creditable service based on records from the service 
department such as hospitalization for 90 days for a line of duty 
disability.
    (c) Verification from the service department. When the claimant does 
not submit evidence of service or the evidence submitted does not meet 
the requirements of paragraph (a) of this section (and paragraph (b) of 
this section in pension claims), the Department of Veterans Affairs 
shall request verification of service from the service department. 
However, payment of nonservice-connected burial benefits may be 
authorized, if otherwise in order, based upon evidence of service which 
VA relied upon to authorize payment of compensation or pension during 
the veteran's lifetime, provided that there is no evidence which would 
serve to create doubt as to the correctness of that service evidence. If 
it appears that a length of service requirement may not be met (e.g., 
the 90 days wartime service requirement to receive pension under 38 
U.S.C. 1521(j)), the Department of Veterans Affairs shall request a 
complete statement of service to determine if there are any periods of 
active service that are required to be excluded under Sec. 3.15.

[45 FR 72654, Nov. 3, 1980, as amended at 46 FR 51246, Oct. 19, 1981; 58 
FR 37857, July 14, 1993; 58 FR 42623, Aug. 10, 1993; 66 FR 19858, Apr. 
18, 2001]



Sec. 3.204  Evidence of dependents and age.

    (a)(1) Except as provided in paragraph (a)(2) of this section, VA 
will accept, for the purpose of determining entitlement to benefits 
under laws administered by VA, the statement of a claimant as proof of 
marriage, dissolution of a marriage, birth of a child, or death of a 
dependent, provided that the statement contains: the date (month and 
year) and place of the event; the full name and relationship of the 
other person to the claimant; and, where the claimant's dependent child 
does not reside with the claimant, the name and address of the person 
who has custody of the child. In addition, a claimant must provide the 
social security number of any dependent on whose behalf he or she is 
seeking benefits (see Sec. 3.216).
    (2) VA shall require the types of evidence indicated in Sec. Sec. 
3.205 through 3.211 where: the claimant does not reside within a state; 
the claimant's statement on its face raises a question of its validity; 
the claimant's statement conflicts with other evidence of record; or, 
there is a reasonable indication, in the claimant's statement or 
otherwise, of fraud or misrepresentation of the relationship in 
question.


(Authority: 38 U.S.C. 5124)

    (b) Marriage or birth. The classes of evidence to be furnished for 
the purpose of establishing marriage, dissolution of marriage, age, 
relationship, or death, if required under the provisions of paragraph 
(a)(2), are indicated in Sec. Sec. 3.205 through 3.211 in the order of 
preference. Failure to furnish the higher class, however, does not 
preclude the acceptance of a lower class if the evidence furnished is 
sufficient to prove the point involved.
    (c) Acceptability of photocopies. Photocopies of documents necessary 
to establish birth, death, marriage or relationship under the provisions 
of Sec. Sec. 3.205 through 3.215 of this part are acceptable as 
evidence if the Department of Veterans Affairs is satisfied that the 
copies are genuine and free from alteration. Otherwise, VA may request a 
copy of the document certified over the signature and official seal of 
the person having custody of such record.

(Authority: 38 U.S.C. 501)

(The Office of Management and Budget has approved the information 
collection requirements in this section under control number 2900-0624)

[26 FR 1572, Feb. 24, 1961, as amended at 40 FR 53581, Nov. 19, 1975; 45 
FR 72655, Nov. 3, 1980; 59 FR 46338, Sept. 8, 1994; 61 FR 56626, Nov. 4, 
1996; 66 FR 56614, Nov. 9, 2001]



Sec. 3.205  Marriage.

    (a) Proof of marriage. Marriage is established by one of the 
following types of evidence:

[[Page 196]]

    (1) Copy or abstract of the public record of marriage, or a copy of 
the church record of marriage, containing sufficient data to identify 
the parties, the date and place of marriage, and the number of prior 
marriages if shown on the official record.
    (2) Official report from service department as to marriage which 
occurred while the veteran was in service.
    (3) The affidavit of the clergyman or magistrate who officiated.
    (4) The original certificate of marriage, if the Department of 
Veterans Affairs is satisfied that it is genuine and free from 
alteration.
    (5) The affidavits or certified statements of two or more 
eyewitnesses to the ceremony.
    (6) In jurisdictions where marriages other than by ceremony are 
recognized the affidavits or certified statements of one or both of the 
parties to the marriage, if living, setting forth all of the facts and 
circumstances concerning the alleged marriage, such as the agreement 
between the parties at the beginning of their cohabitation, the period 
of cohabitation, places and dates of residences, and whether children 
were born as the result of the relationship. This evidence should be 
supplemented by affidavits or certified statements from two or more 
persons who know as the result of personal observation the reputed 
relationship which existed between the parties to the alleged marriage 
including the periods of cohabitation, places of residences, whether the 
parties held themselves out as married, and whether they were generally 
accepted as such in the communities in which they lived.
    (7) Any other secondary evidence which reasonably supports a belief 
by the Adjudicating activity that a valid marriage actually occurred.
    (b) Valid marriage. In the absence of conflicting information, proof 
of marriage which meets the requirements of paragraph (a) of this 
section together with the claimant's certified statement concerning the 
date, place and circumstances of dissolution of any prior marriage may 
be accepted as establishing a valid marriage, provided that such facts, 
if they were to be corroborated by record evidence, would warrant 
acceptance of the marriage as valid. Where necessary to a determination 
because of conflicting information or protest by a party having an 
interest therein, proof of termination of a prior marriage will be shown 
by proof of death, or a certified copy or a certified abstract of final 
decree of divorce or annulment specifically reciting the effects of the 
decree.
    (c) Marriages deemed valid. Where a surviving spouse has submitted 
proof of marriage in accordance with paragraph (a) of this section and 
also meets the requirements of Sec. 3.52, the claimant's signed 
statement that he or she had no knowledge of an impediment to the 
marriage to the veteran will be accepted, in the absence of information 
to the contrary, as proof of that fact.

(Authority: 38 U.S.C. 501)

    Cross References: Marriages deemed valid. See Sec. 3.52. 
Definitions; marriage. See Sec. 3.1(j). Evidence of dependents and age. 
See Sec. 3.204.

[26 FR 1572, Feb. 24, 1961, as amended at 27 FR 6281, July 3, 1962; 36 
FR 20946, Nov. 2, 1971; 40 FR 53581, Nov. 19, 1975; 45 FR 72655, Nov. 3, 
1980; 47 FR 28096, June 29, 1982; 52 FR 19349, May 22, 1987; 58 FR 
37857, July 14, 1993; 59 FR 46338, Sept. 8, 1994; 62 FR 5529, Feb. 6, 
1997]



Sec. 3.206  Divorce.

    The validity of a divorce decree regular on its face, will be 
questioned by the Department of Veterans Affairs only when such validity 
is put in issue by a party thereto or a person whose interest in a claim 
for Department of Veterans Affairs benefits would be affected thereby. 
In cases where recognition of the decree is thus brought into question:
    (a) Where the issue is whether the veteran is single or married 
(dissolution of a subsisting marriage), there must be a bona fide 
domicile in addition to the standards of the granting jurisdiction 
respecting validity of divorce;
    (b) Where the issue is the validity of marriage to a veteran 
following a divorce, the matter of recognition of the divorce by the 
Department of Veterans Affairs (including any question of bona fide 
domicile) will be determined according to the laws of the jurisdictions 
specified in Sec. 3.1(j).

[[Page 197]]

    (c) Where a foreign divorce has been granted the residents of a 
State whose laws consider such decrees to be valid, it will thereafter 
be considered as valid under the laws of the jurisdictions specified in 
Sec. 3.1(j) in the absence of a determination to the contrary by a 
court of last resort in those jurisdictions.

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[27 FR 6281, July 3, 1962, as amended at 35 FR 16831, Oct. 31, 1970; 40 
FR 53581, Nov. 19, 1975; 52 FR 19349, May 22, 1987]



Sec. 3.207  Void or annulled marriage.

    Proof that a marriage was void or has been annulled should consist 
of:
    (a) Void. A certified statement from the claimant setting forth the 
circumstances which rendered the marriage void, together with such other 
evidence as may be required for a determination.
    (b) Annulled. A copy or abstract of the decree of annulment. A 
decree regular on its face will be accepted unless there is reason to 
question the basic authority of the court to render annulment decrees or 
there is evidence indicating that the annulment may have been obtained 
through fraud by either party or by collusion.

    Cross References: Effective dates, void or annulled marriage. See 
Sec. 3.400 (u) and (v). Evidence of dependents and age. See Sec. 
3.204.

[28 FR 2904, Mar. 3, 1963, as amended at 40 FR 53581, Nov. 19, 1975; 52 
FR 19349, May 22, 1987; 59 FR 46338, Sept. 8, 1994]



Sec. 3.208  Claims based on attained age.

    In claims for pension where the age of the veteran or surviving 
spouse is material, the statements of age will be accepted where they 
are in agreement with other statements in the record as to age. However, 
where there is a variance in such records, the youngest age will be 
accepted subject to the submission of evidence as outlined in Sec. 
3.209.

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[40 FR 53581, Nov. 19, 1975, as amended at 52 FR 19349, May 22, 1987]



Sec. 3.209  Birth.

    Age or relationship is established by one of the following types of 
evidence. If the evidence submitted for proof of age or relationship 
indicates a difference in the name of the person as shown by other 
records, the discrepancy is to be reconciled by an affidavit or 
certified statement identifying the person having the changed name as 
the person whose name appears in the evidence of age or relationship.
    (a) A copy or abstract of the public record of birth. Such a record 
established more than 4 years after the birth will be accepted as proof 
of age or relationship if, it is not inconsistent with material of 
record with the Department of Veterans Affairs, or if it shows on its 
face that it is based upon evidence which would be acceptable under this 
section.
    (b) A copy of the church record of baptism. Such a record of baptism 
performed more than 4 years after birth will not be accepted as proof of 
age or relationship unless it is consistent with material of record with 
the Department of Veterans Affairs, which will include at least one 
reference to age or relationship made at a time when such reference was 
not essential to establishing entitlement to the benefit claimed.
    (c) Official report from the service department as to birth which 
occurred while the veteran was in service.
    (d) Affidavit or a certified statement of the physician or midwife 
in attendance at birth.
    (e) Copy of Bible or other family record certified to by a notary 
public or other officer with authority to administer oaths, who should 
state in what year the Bible or other book in which the record appears 
was printed, whether the record bears any erasures or other marks of 
alteration, and whether from the appearance of the writing he or she 
believes the entries to have been made at the time purported.
    (f) Affidavits or certified statements of two or more persons, 
preferably disinterested, who will state their ages, showing the name, 
date, and place of birth of the person whose age or relationship is 
being established, and that to their own knowledge such person is

[[Page 198]]

the child of such parents (naming the parents) and stating the source of 
their knowledge.
    (g) Other evidence which is adequate to establish the facts in 
issue, including census records, original baptismal records, hospital 
records, insurance policies, school, employment, immigration, or 
naturalization records.

(Authority: 38 U.S.C. 501)

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[26 FR 1573, Feb. 24, 1961, as amended at 27 FR 1899, Feb. 28, 1962; 40 
FR 53581, Nov. 19, 1975; 47 FR 28096, June 29, 1982; 52 FR 19349, May 
22, 1987; 59 FR 46338, Sept. 8, 1994]



Sec. 3.210  Child's relationship.

    (a) Legitimate child. Where it is necessary to determine the 
legitimacy of a child, evidence will be required to establish the 
legality of the marriage of the mother of the child to the veteran or to 
show that the child is otherwise legitimate by State laws together with 
evidence of birth as outlined in Sec. 3.209. Where the legitimacy of a 
child is not a factor, evidence to establish legitimacy will not be 
required: Provided, That, evidence is on file which meets the 
requirements of paragraph (b) of this section sufficient to warrant 
recognition of the relationship of the child without regard to 
legitimacy.
    (b) Illegitimate child. As to the mother of an illegitimate child, 
proof of birth is all that is required. As to the father, the 
sufficiency of evidence will be determined in accordance with the facts 
in the individual case. Proof of such relationship will consist of:
    (1) An acknowledgment in writing signed by him; or
    (2) Evidence that he has been identified as the child's father by a 
judicial decree ordering him to contribute to the child's support or for 
other purposes; or
    (3) Any other secondary evidence which reasonably supports a finding 
of relationship, as determined by an official authorized to approve such 
findings, such as:
    (i) A copy of the public record of birth or church record of 
baptism, showing that the veteran was the informant and was named as 
parent of the child; or
    (ii) Statements of persons who know that the veteran accepted the 
child as his; or
    (iii) Information obtained from service department or public 
records, such as school or welfare agencies, which shows that with his 
knowledge the veteran was named as the father of the child.
    (c) Adopted child. Except as provided in paragraph (c)(1) of this 
section evidence of relationship will include a copy of the decree of 
adoption or a copy of the adoptive placement agreement and such other 
evidence as may be necessary.
    (1) In jurisdictions where petition must be made to the court for 
release of adoption documents or information, or where release of such 
documents or information is prohibited, the following may be accepted to 
establish the fact of adoption:
    (i) As to a child adopted into the veteran's family, a copy of the 
child's revised birth certificate.
    (ii) As to a child adopted out of the veteran's family, a statement 
over the signature of the judge or the clerk of the court setting forth 
the child's former name and the date of adoption, or a certified 
statement by the veteran, the veteran's surviving spouse, apportionee, 
or their fiduciaries setting forth the child's former name, date of 
birth, and the date and fact of adoption together with evidence 
indicating that the child's original public record of birth has been 
removed from such records. Where application is made for an 
apportionment under Sec. 3.458(d) on behalf of a child adopted out of 
the veteran's family, the evidence must be sufficient to establish the 
veteran as the natural parent of the child.
    (2) As to a child adopted by the veteran's surviving spouse after 
the veteran's death, the statement of the adoptive parent or custodian 
of the child will be accepted in absence of information to the contrary, 
to show that the child was a member of the veteran's household at the 
date of the veteran's death and that recurring contributions were not 
being received for the child's maintenance sufficient to provide for the 
major portion of the child's support, from any person other than the 
veteran or surviving spouse or

[[Page 199]]

from any public or private welfare organization which furnished services 
or assistance to children. (Pub. L. 86-195)
    (d) Stepchild. Evidence of relationship of a stepchild will consist 
of proof of birth as outlined in Sec. 3.209, evidence of the marriage 
of the veteran to the natural parent of the child, and evidence that the 
child is a member of the veteran's household or was a member of the 
veteran's household at the date of the veteran's death.

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[26 FR 1573, Feb. 24, 1961, as amended at 27 FR 1899, Feb. 28, 1962; 28 
FR 2959, Mar. 26, 1963; 38 FR 871, Jan. 5, 1973; 47 FR 28096, June 29, 
1982; 52 FR 19349, May 22, 1987; 59 FR 46338, Sept. 8, 1994]



Sec. 3.211  Death.

    Death should be established by one of the following types of 
evidence:
    (a)(1) A copy of the public record of the State or community where 
death occurred.
    (2) A copy of a coroner's report of death or a verdict of a 
coroner's jury of the State or community where death occurred, provided 
such report or verdict properly identified the deceased.
    (b) Where death occurs in a hospital or institution under the 
control of the United States Government:
    (1) A death certificate signed by a medical officer; or
    (2) A clinical summary or other report showing fact and date of 
death signed by a medical officer.
    (c) An official report of death of a member of a uniformed service 
from the Secretary of the department concerned where death occurs while 
deceased was on the retired list, in an inactive duty status, or in the 
active service.
    (d) Where death occurs abroad:
    (1) A United States consular report of death bearing the signature 
and seal of the United States consul; or
    (2) A copy of the public record of death authenticated (see Sec. 
3.202(b)(4) for exception) by the United States consul or other agency 
of the State Department; or
    (3) An official report of death from the head of the department 
concerned, where the deceased person was, at the time of death, a 
civilian employee of such department.
    (e) If the foregoing evidence cannot be furnished, the reason must 
be stated. The fact of death may then be established by the affidavits 
of persons who have personal knowledge of the fact of death, have viewed 
the body of the deceased, know it to be the body of the person whose 
death is being established, setting forth all the facts and 
circumstances concerning the death, place, date, time, and cause 
thereof.
    (f) If proof of death, as defined in paragraphs (a) through (e) of 
this section cannot be furnished, a finding of fact of death, where 
death is otherwise shown by competent evidence, may be made by an 
official authorized to approve such findings. Where it is indicated that 
the veteran died under circumstances which precluded recovery or 
identification of the body, the fact of death should be established by 
the best evidence, which from the nature of the case must be supposed to 
exist.
    (g) In the absence of evidence to the contrary, a finding of fact of 
death made by another Federal agency will be accepted for the purposes 
of paragraph (f) of this section.

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[26 FR 1573, Feb. 24, 1961, as amended at 27 FR 1899, Feb. 28, 1962; 52 
FR 19349, May 22, 1987; 59 FR 46338, Sept. 8, 1994]



Sec. 3.212  Unexplained absence for 7 years.

    (a) If satisfactory evidence is produced establishing the fact of 
the continued and unexplained absence of any individual from his or her 
home and family for a period of 7 years or more and that a diligent 
search disclosed no evidence of his or her existence after the date of 
disappearance, and if evidence as provided in Sec. 3.211 cannot be 
furnished, the death of such individual as of the expiration of such 
period may be considered as sufficiently proved.
    (b) No State law providing for presumption of death will be 
applicable to claims for benefits under laws administered by the 
Department of Veterans Affairs and the finding of death will be final 
and conclusive except where suit

[[Page 200]]

is filed for insurance under 38 U.S.C. 1984.


(Authority: 38 U.S.C. 108)

    (c) In the absence of evidence to the contrary, a finding of death 
made by another Federal agency will be accepted if the finding meets the 
requirements of paragraph (a) of this section.

    Cross Reference: Evidence of dependents and age. See Sec. 3.204.

[26 FR 1573, Feb. 24, 1961, as amended at 27 FR 1899, Feb. 28, 1962; 52 
FR 19349, May 22, 1987]



Sec. 3.213  Change of status affecting entitlement.

    (a) General. For the purpose of establishing entitlement to a higher 
rate of pension, compensation, or dependency and indemnity compensation 
based on the existence of a dependent, VA will require evidence which 
satisfies the requirements of Sec. 3.204. For the purpose of reducing 
or discontinuing such benefits, a statement by a claimant or payee 
setting forth the month and year of change of status which would result 
in a reduction or discontinuance of benefits to that person will be 
accepted, in the absence of contradictory information. This includes:
    (1) Veteran. A statement by the veteran setting forth the month and 
year of death of a spouse, child, or dependent parent.
    (2) Surviving spouse. A statement by the surviving spouse or 
remarried surviving spouse setting forth the month and year of 
remarriage and any change of name. (An award for a child or children who 
are otherwise entitled may be made to commence the day following the 
date of discontinuance of any payments to the surviving spouse.)
    (3) Child. A statement by the veteran or surviving spouse (where an 
additional allowance is being paid to the veteran or surviving spouse 
for a child), or fiduciary, setting forth the month and year of the 
child's death, marriage, or discontinuance of school attendance. A 
similar statement by a child who is receiving payments direct will be 
accepted to establish the child's marriage or the discontinuance of 
school attendance. Where appropriate, the month and year of 
discontinuance of school attendance will be required in addition to the 
month and year of death or marriage of a child.


(Authority: 38 U.S.C. 501)

    (4) Parent. A statement by a parent setting forth the month and 
year:
    (i) Of marriage or remarriage;
    (ii) When two parents or a parent and spouse ceased living together;
    (iii) When two parents or a parent and spouse resumed living 
together following a period of separation;
    (iv) Of divorce or death of a spouse.
    (b) Date not reported. If the month and year of the event is not 
reported, the award will be reduced or discontinued, whichever is 
appropriate, effective date of last payment. The payee will be requested 
to furnish within 60 days from the date of request a statement setting 
forth the date of the event. Where payments are continued at a reduced 
rate, the award will be discontinued effective date of last payment if 
the required statement is not received within the 60-day period. 
Payments on a discontinued award may be resumed, if otherwise in order, 
from the date of discontinuance if the necessary information is received 
within 1 year from the date of request; otherwise from the date of 
receipt of a new claim.
    (c) Contradictory information. Where there is reason to believe that 
the event reported may have occurred at an earlier date, formal proof 
will be required.

    Cross References: Abandoned claims. See Sec. 3.158. Change in 
status of dependents. See Sec. 3.651. Material change in income, net 
worth or change in status. See Sec. 3.660. Evidence of dependents and 
age. See Sec. 3.204.

[26 FR 1574, Feb. 24, 1961, as amended at 27 FR 1899, Feb. 28, 1962; 27 
FR 11888, Dec. 1, 1962; 52 FR 19349, May 22, 1987; 61 FR 56626, Nov. 4, 
1996]



Sec. 3.214  Court decisions; unremarried surviving spouses.

    Effective July 15, 1958, a decision rendered by a Federal court in 
an action to which the United States was a party holding that a 
surviving spouse of a veteran has not remarried will be followed in 
determining eligibility for

[[Page 201]]

pension, compensation or dependency and indemnity compensation.

    Cross References: Abandoned claims. See Sec. 3.158. Change in 
status of dependents. See Sec. 3.651. Dependency, income and estate. 
See Sec. 3.660. Evidence of dependents and age. See Sec. 3.204.

[31 FR 2782, Feb. 16, 1966, as amended at 52 FR 19349, May 22, 1987]



Sec. 3.215  Termination of marital relationship or conduct.

    On or after January 1, 1971, benefits may be resumed to an unmarried 
surviving spouse upon filing of an application and submission of 
satisfactory evidence that the surviving spouse has ceased living with 
another person and holding himself or herself out openly to the public 
as that person's spouse or that the surviving spouse has terminated a 
relationship or conduct which had created an inference or presumption of 
remarriage or related to open or notorious adulterous cohabitation or 
similar conduct, if the relationship terminated prior to November 1, 
1990. Such evidence may consist of, but is not limited to, the surviving 
spouse's certified statement of the fact.

[57 FR 10426, Mar. 26, 1992, as amended at 58 FR 32445, June 10, 1993]



Sec. 3.216  Mandatory disclosure of social security numbers.

    Any person who applies for or receives any compensation or pension 
benefit as defined in Sec. Sec. 3.3, 3.4, or 3.5 of this part, a 
monetary allowance under 38 U.S.C. chapter 18, shall, as a condition for 
receipt or continued receipt of benefits, furnish the Department of 
Veterans Affairs upon request with his or her social security number and 
the social security number of any dependent or beneficiary on whose 
behalf, or based upon whom, benefits are sought or received. However, no 
one shall be required to furnish a social security number for any person 
to whom none has been assigned. Benefits will be terminated if a 
beneficiary fails to furnish the Department of Veterans Affairs with his 
or her social security number or the social security number of any 
dependent or beneficiary on whose behalf, or based upon whom, benefits 
are sought or received, within 60 days from the date the beneficiary is 
requested to furnish the social security number.

(Authority: 38 U.S.C. 1822, 5101(c))

(Approved by the Office of Management and Budget under control number 
2900-0522)

[57 FR 8268, Mar. 9, 1992, as amended at 57 FR 27935, June 23, 1992; 65 
FR 35282, June 2, 2000; 67 FR 49586, July 31, 2002]



Sec. 3.217  Submission of statements or information affecting entitlement to benefits.

    (a) For purposes of this part, unless specifically provided 
otherwise, the submission of information or a statement that affects 
entitlement to benefits by e-mail, facsimile, or other written 
electronic means, will satisfy a requirement or authorization that the 
statement or information be submitted in writing.

    Note to paragraph(a): Section 3.217(a) merely concerns the 
submission of information or a statement in writing. Other requirements 
specified in this part, such as a requirement to use a specific form, to 
provide specific information, to provide a signature, or to provide a 
certified statement, must still be met.

    (b) For purposes of this part, unless specifically provided 
otherwise, VA may take action affecting entitlement to benefits based on 
oral or written information or statements provided to VA by a 
beneficiary or his or her fiduciary. However, VA may not take action 
based on oral information or statements unless the VA employee receiving 
the information meets the following conditions:
    (1) During the conversation in which the information or statement is 
provided, the VA employee:
    (i) Identifies himself or herself as a VA employee who is authorized 
to receive the information or statement (these are VA employees 
authorized to take actions under Sec. Sec. 2.3 or 3.100 of this 
chapter);
    (ii) Verifies the identity of the provider as either the beneficiary 
or his or her fiduciary by obtaining specific information about the 
beneficiary that can be verified from the beneficiary's VA records, such 
as Social Security number, date of birth, branch of military service, 
dates of military service, or other information; and

[[Page 202]]

    (iii) Informs the provider that the information or statement will be 
used for the purpose of calculating benefit amounts; and
    (2) During or following the conversation in which the information or 
statement is provided, the VA employee documents in the beneficiary's VA 
records the specific information or statement provided, the date such 
information or statement was provided, the identity of the provider, the 
steps taken to verify the identity of the provider as being either the 
beneficiary or his or her fiduciary, and that he or she informed the 
provider that the information would be used for the purpose of 
calculating benefit amounts.

    Authority: 38 U.S.C. 501, 1115, 1506, 5104.

[66 FR 56614, Nov. 9, 2001]

                      Dependency, Income and Estate

  Regulations Applicable to Programs in Effect Prior to January 1, 1979



Sec. 3.250  Dependency of parents; compensation.

    (a) Income--(1) Conclusive dependency. Dependency of a parent (other 
than one who is residing in a foreign country) will be held to exist 
where the monthy income does not exceed:
    (i) $400 for a mother or father not living together;
    (ii) $660 for a mother and father, or remarried parent and spouse, 
living together:
    (iii) $185 for each additional ``member of the family'' as defined 
in paragraph (b)(2).


(Authority: 38 U.S.C. 102(a))

    (2) Excess income. Where the income exceeds the monthly amounts 
stated in paragraph (a)(1) of this section dependency will be determined 
on the facts in the individual case under the principles outlined in 
paragraph (b) of this section. In such cases, dependency will not be 
held to exist if it is reasonable that some part of the corpus of the 
claimant's estate be consumed for his or her maintenance.
    (3) Foreign residents. There is no conclusive presumption of 
dependency. Dependency will be determined on the facts in the individual 
case under the principles outlined in this section.
    (b) Basic rule. Dependency will be held to exist if the father or 
mother of the veteran does not have an income sufficient to provide 
reasonable maintenance for such father or mother and members of his or 
her family under legal age and for dependent adult members of the family 
if the dependency of such adult member results from mental or physical 
incapacity.
    (1) ``Reasonable Maintenance'' includes not only housing, food, 
clothing, and medical care sufficient to sustain life, but such items 
beyond the bare necessities as well as other requirements reasonably 
necessary to provide those conveniences and comforts of living suitable 
to and consistent with the parents' reasonable mode of life.
    (2) ``Member of the family'' means a person (other than spouse) 
including a relative in the ascending as well as descending class, whom 
the father or mother is under moral or legal obligation to support. In 
determining whether other members of the family under legal age are 
factors in necessary expenses of the mother or father, consideration 
will be given to any income from business or property (including trusts) 
actually available, directly or indirectly, to the mother or father for 
the support of the minor but not to the corpus of the estate or the 
income of the minor which is not so available.
    (c) Inception of dependency. The fact that the veteran has made 
habitual contributions to the father or mother, or both, is not 
conclusive evidence that dependency existed but will be considered in 
connection with all other evidence. In death claims, it is not material 
whether dependency arose prior or subsequent to the veteran's death. 
(See Sec. 3.1000(d)(3) as to accrued.)


(Authority: 38 U.S.C. 102(a))

    (d) Remarriage. Dependency will not be denied solely because of 
remarriage (38 U.S.C. 102(b)(1)). Compensation may be continued if the 
parent submits evidence to show that dependency exists, considering the 
combined income and expenses of the parent and spouse.

[28 FR 29, Jan. 1, 1963, as amended at 40 FR 16065, Apr. 9, 1975; 49 FR 
47004, Nov. 30, 1984; 61 FR 20727, May 8, 1996]

[[Page 203]]



Sec. 3.251  Income of parents; dependency and indemnity compensation.

    (a) Annual income limitations and rates. (1) Dependency and 
indemnity compensation is not payable to a parent or parents whose 
annual income exceeds the limitations set forth in 38 U.S.C. 1315 (b), 
(c), or (d).
    (2) Where there is only one parent, and the parent has remarried and 
is living with his or her spouse, dependency and indemnity compensation 
will be paid under either the formula in 38 U.S.C. 1315(b)(1) or the 
formula in 38 U.S.C. 1315(d), whichever will provide the greater monthly 
rate of dependency and indemnity compensation. The total combined annual 
income of the parent and spouse will be counted.


(Authority: 38 U.S.C. 1315)

    (3) Where the claim is based on service in the Commonwealth Army of 
the Philippines, or as a guerrilla or as a Philippine Scout under 
section 14, Pub. L. 190, 79th Congress, the income limitation will be at 
a rate of $0.50 for each dollar. See Sec. 3.100(b).


(Authority: 38 U.S.C. 107)

    (4) If the remarriage of a parent has been terminated, or the parent 
is separated from his or her spouse, the rate of dependency and 
indemnity compensation for the parent will be that which would be 
payable if there were one parent alone or two parents not living 
together, whichever is applicable.
    (5) Where there are two parents living and only one parent has filed 
claim, the rate of dependency and indemnity compensation will be that 
which would be payable if both parents had filed claim.
    (b) Basic rule. Payments of any kind or from any source will be 
counted as income unless specifically excluded. Income will be counted 
for the calendar year in which it is received and total income for the 
full calendar year will be considered except as provided in Sec. 3.260.

[28 FR 29, Jan. 1, 1963, as amended at 31 FR 14455, Nov. 10, 1966; 40 FR 
16065, Apr. 9, 1975; 41 FR 15411, Apr. 13, 1976; 60 FR 18355, Apr. 11, 
1995]



Sec. 3.252  Annual income; pension; Mexican border period and later war periods.

    (a) Annual income limitations; old-law pension. Where the right to 
old-law pension is payable under section 306(b) of Pub. L. 95-588 (92 
Stat. 2497), pension is not payable if the pensioner's annual income 
exceeds the income limitations prescribed by Sec. 3.26(c).
    (b) Annual income and net worth limitations; Pub. L. 86-211. Pension 
is not payable to a veteran, surviving spouse or child whose annual 
income exceeds the limitations set forth in 38 U.S.C. 1521, 1541 or 
1542; or to a veteran, surviving spouse or child if it is reasonable 
that some part of the claimant's estate be consumed for his or her 
maintenance. Where a veteran and spouse are living together, the 
separate income of the spouse will be considered as the veteran's income 
as provided in Sec. 3.262(b).


(Authority: 38 U.S.C. 1543)

    (c) Basic rule. Payments of any kind or from any source will be 
counted as income unless specifically excluded. Income will be counted 
for the calendar year in which it is received and total income for the 
full calendar year will be considered except as provided in Sec. 3.260.
    (d) Veteran with a spouse. For the purpose of determining 
eligibility under paragraph (b) of this section the pension rates 
provided by 38 U.S.C. 1521(c) may be authorized for a married veteran if 
he or she is living with or, if estranged, is reasonably contributing to 
the support of his or her spouse. The determination of ``reasonable'' 
contribution will be based on all the circumstances in the case, 
considering the income and estate of the veteran and the separate income 
and estate of the spouse. Apportionment of the veteran's pension under 
Sec. 3.451 meets the requirement of reasonable contribution.
    (e) Surviving spouse with a child--(1) Child. The term ``child'' 
means a child as defined in Sec. 3.57. Where a veteran's child is born 
after the veteran dies, the surviving spouse will not be considered a 
surviving spouse with a child prior to the child's date of birth.
    (2) Veteran's child not in surviving spouse's custody. Where the 
veteran was

[[Page 204]]

survived by a surviving spouse and by a child, the income increments for 
a surviving spouse and child apply even though the child is not the 
child of the surviving spouse and not in his or her custody.
    (3) Income of child. The separate income received by a child or 
children, regardless of custody, will not be considered in computing the 
surviving spouse's income. Where the separate income of the child is 
turned over to the surviving spouse, only so much of the money as is 
left after deducting any expenses for maintenance of the child will be 
considered the surviving spouse's income.
    (4) Alternative rate. Whenever the monthly pension rate payable to 
the surviving spouse under the formula in 38 U.S.C. 1541(c) is less than 
the rate payable for one child under section 1542 if the surviving 
spouse were not entitled, the surviving spouse will be paid the child's 
rate.
    (f) Income over maximum; reduced aid and attendance allowance. 
Beginning January 1, 1977, veterans in need of regular aid and 
attendance who are not receiving pension because their income exceeds 
the applicable statutory limitation may be eligible for a reduced aid 
and attendance allowance. The amount payable is the regular aid and 
attendance allowance authorized by 38 U.S.C. 1521(d)(1) reduced by 16.6 
percent for each $100, or portion thereof, by which the veteran's annual 
income exceeds the applicable maximum income limitation. The reduced aid 
and attendance allowance is payable when:
    (1) A veteran in need of regular aid and attendance is denied 
pension under 38 U.S.C. 1521 solely because the veteran's annual income 
exceeds the applicable maximum income limitation in 38 U.S.C. 1521 
(b)(3) and (c)(3); or
    (2) Pension payable under 38 U.S.C. 1521 to a veteran in need of 
regular aid and attendance is discontinued solely because the veteran's 
annual income exceeds the applicable maximum income limitation in 38 
U.S.C. 1521 (b)(3) or (c)(3); and
    (3) The veteran's annual income exceeds the applicable maximum 
income limitation in 38 U.S.C. 1521 (b)(3) or (c)(3) by an amount not 
greater than the amount specified in 38 U.S.C. 1521 (d)(2).

    Cross References: Basic pension determinations. See Sec. 3.314. 
Determination of permanent need for regular aid and attendance and 
``permanently bedridden''. See Sec. 3.352.

[28 FR 30, Jan. 1, 1963, as amended at 40 FR 16065, Apr. 9, 1975; 41 FR 
15411, Apr. 13, 1976; 41 FR 56803, Dec. 30, 1976; 44 FR 45935, Aug. 6, 
1979; 61 FR 20727, May 8, 1996; 62 FR 5529, Feb. 6, 1997]



Sec. Sec. 3.253-3.255  [Reserved]



Sec. 3.256  Eligibility reporting requirements.

    (a) Obligation to report changes in factors affecting entitlement. 
Any individual who has applied for or receives pension or parents' 
dependency and indemnity compensation must promptly notify the Secretary 
of any change affecting entitlement in any of the following:
    (1) Income;
    (2) Net worth or corpus of estate;
    (3) Marital status;
    (4) Nursing home patient status;
    (5) School enrollment status of a child 18 years of age or older; or
    (6) Any other factor that affects entitlement to benefits under the 
provisions of this part.
    (b) Eligibility verification reports. (1) For purposes of this 
section the term eligibility verification report means a form prescribed 
by the Secretary that is used to request income, net worth (if 
applicable), dependency status, and any other information necessary to 
determine or verify entitlement to pension or parents' dependency and 
indemnity compensation.
    (2) VA will not require old law or section 306 pensioners to submit 
eligibility verification reports unless the Secretary determines that 
doing so is necessary to preserve program integrity.
    (3) The Secretary shall require an eligibility verification report 
from individuals receiving parents' dependency and indemnity 
compensation under the following circumstances:
    (i) If the Social Security Administration has not verified the 
beneficiary's Social Security number and, if the beneficiary is married, 
his or her spouse's Social Security number.

[[Page 205]]

    (ii) If there is reason to believe that the beneficiary or, if the 
spouse's income could affect entitlement, his or her spouse may have 
received income other than Social Security during the current or 
previous calendar year; or
    (iii) If the Secretary determines that an eligibility verification 
report is necessary to preserve program integrity.
    (4) An individual who applies for or receives pension or parents' 
dependency and indemnity compensation as defined in Sec. Sec. 3.3 or 
3.5 of this part shall, as a condition of receipt or continued receipt 
of benefits, furnish the Department of Veterans Affairs an eligibility 
verification report upon request.
    (c) If VA requests that a claimant or beneficiary submit an 
eligibility verification report but he or she fails to do so within 60 
days of the date of the VA request, the Secretary shall suspend the 
award or disallow the claim.

(Authority: Sec. 306(a)(2) and (b)(3), Pub. L. 95-588, 92 Stat. 2508-
2509; 38 U.S.C. 1315(e))

(The Office of Management and Budget has approved the information 
collection requirements in this section under control numbers 2900-0101 
and 2900-0624.)

[63 FR 53595, Oct. 6, 1998, as amended at 66 FR 56614, Nov. 9, 2001]



Sec. 3.257  Children; no surviving spouse entitled.

    Where pension is not payable to a surviving spouse because his or 
her annual income exceeds the statutory limitation or because of his or 
her net worth, payments will be made to or for the child or children as 
if there were no surviving spouse.

[62 FR 5529, Feb. 6, 1997]



Sec. Sec. 3.258-3.259  [Reserved]



Sec. 3.260  Computation of income.

    For entitlement to pension or dependency and indemnity compensation, 
income will be counted for the calendar year in which it is received.
    (a) Installments. Income will be determined by the total amount 
received or anticipated during the calendar year.
    (b) Deferred determinations. Where there is doubt as to the amount 
of the anticipated income, pension or dependency and indemnity 
compensation will be allowed at the lowest appropriate rate or will be 
withheld, as may be in order, until the end of the calendar year when 
the total income received during the year may be determined.
    (c) Proportionate income limitations; excess income. A proportionate 
income limitation will be established under the conditions set forth in 
paragraph (d) of this section except where application of a 
proportionate income limitation would result in payment of a lower rate 
than would be payable on the basis of income for the full calendar year.
    (d) Proportionate income limitations; computation. Income 
limitations will be computed proportionately for the purpose of 
determining initial entitlement, or for resuming payments on an award 
which was discontinued for a reason other than excess income or a change 
in marital or dependency status. A proportionate income limitation will 
be established for the period from the date of entitlement to the end of 
that calendar year. The total amount of income received by the claimant 
during that period will govern the payment of benefits. Income received 
prior to the date of entitlement will be disregarded.
    (e) Proportionate income limitations; spouse. In determining whether 
proportionate computation is applicable to a claim under Pub. L. 86-211 
(73 Stat. 432), the total income for the calendar year of entitlement of 
both veteran and that of the spouse available for use of the veteran 
will be considered. If a proportionate income limitation is then 
applicable, it will be applied to both the veteran's and the spouse's 
income. The spouse's income will not be included, however, where his or 
her total income for the calendar year does not exceed $1,200.
    (f) Rate changes. In years after that for which entitlement to 
pension or dependency and indemnity compensation has been established or 
reestablished as provided in paragraph (d) of this section, total income 
for the calendar year will govern the payment of benefits. Where there 
is a change in the conditions of entitlement because of a change in 
marital or dependency status, entitlement for each period will be 
determined separately. For the period

[[Page 206]]

when the claimant was married or had a dependent, the rate payable will 
be determined under the annual income limitation or increment applicable 
to a claimant who is married or has a dependent. For the period when the 
claimant was unmarried or without a dependent, the rate payable will be 
determined under the annual income limitation or increment applicable to 
a claimant who is not married or has no dependent. Since these 
determinations will be based on total income for the calendar year, it 
is not material whether such income was received before or after the 
change of status.
    (g) Fractions of dollars. In computing a claimant's annual income a 
fraction of a dollar will be disregarded for the purpose of determining 
entitlement to monthly payments of pension and dependency and indemnity 
compensation.

(Authority: 38 U.S.C. 1315(g)(2); 1503(b))

[28 FR 30, Jan. 1, 1963, as amended at 29 FR 2944, Mar. 4, 1964; 37 FR 
6677, Apr. 1, 1972; 40 FR 16066, Apr. 9, 1975]



Sec. 3.261  Character of income; exclusions and estates.

    The following factors will be considered in determining whether a 
claimant meets the requirements of Sec. Sec. 3.250, 3.251 and 3.252 
with reference to dependency, income limitations and corpus of estate:
    (a) Income.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Dependency and         Pension; old-law     Pension; section 306
               Income                 Dependency (parents)   indemnity compensation   (veterans, surviving   (veterans, surviving          See--
                                                                    (parents)        spouses and children)  spouses and children)
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) Total income from employment,    Included..............  Included..............  Included.............  Included.............  Sec.  3.262(a).
 business, investments, or rents.
(2) Income of spouse...............  ......do..............  ......do..............  Excluded.............  ......do.............  Sec.  3.262(b).
(3) Earnings of members of family    ......do..............  Excluded..............  ......do.............  Excluded.............  Sec.  3.250(b)(2).
 under legal age.                                                                                                                  Sec.  3.252(e)(3).
(4) Earned income of child-claimant  ......................  ......................  Included.............  ......do.............
(5) Gifts, including contributions
 from adult members of family:
  Property.........................  ......do..............  Included..............  ......do.............  ......do.............  Sec.  3.262(k).
  Money............................  ......do..............  ......do..............  ......do.............  Included.............
(6) Value of maintenance by          Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(c).
 relative, friend, or organization.
(7) Rental value of property owned   ......do..............  ......do..............  ......do.............  ......do.............
 by and resided in by claimant.
(8) Charitable donations...........  ......do..............  ......do..............  Included.............  ......do.............  Sec.  3.262(d).
(9) Family allowance authorized by   Included..............  Included..............  ......do.............  Included.............
 service personnel.
(10) Reasonable value of allowances  ......do..............  ......do..............  ......do.............  Included except as
 to person in service in addition                                                                            earned income of
 to base pay.                                                                                                child-claimant.
(11) Mustering-out pay.............  Excluded..............  ......do..............  Excluded.............  ......do.............
(12) Six-months' death gratuity....  ......do..............  Excluded..............  ......do.............  Excluded.............
(13) Bonus or similar cash gratuity  Excluded..............  Excluded..............  Excluded.............  Excluded.............
 paid by any State based on service
 in Armed Forces of United States.
(14) Retired Serviceman's Family
 Protection Plan; Survivor Benefit
 Plan (10 U.S.C. ch. 73):
  Retired Serviceman's Family
   Protection Plan (Subch. I):
    Annuities......................  ......do..............  ......do..............  ......do.............  ......do.............
    Refund (10 U.S.C. 1446)........  Included..............  Included..............  Included.............  Included.............
  Survivor Benefit Plan (Subch. II)  ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(e).
   (Pub. L. 92-425; 86 Stat. 706).
Annuity under Sec.  653, Pub. L.    Included..............  Included..............  Excluded.............  Excluded.............  Sec.  3.262(r)
 100-456.
(15) Retirement pay received direct  Included..............  Included..............  Included.............  Included.............  Sec.  3.262(e).
 from service department.            ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(h).
(16) Retirement benefits; general..  ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(e).
(17) Social security benefits:
  Old age and survivors', and        Included..............  Included..............  Included.............  Included.............  Sec.  3.262(f).
   disability insurance.
    Charitable programs............  Excluded..............  Excluded..............  ......do.............  Excluded.............

[[Page 207]]

 
    Lump-sum death payments........  Included..............  ......do..............  ......do.............  ......do.............
    Supplemental security income...  Excluded..............  Excluded..............  ......do.............  ......do.............
(18) Railroad Retirement benefits..  ......do..............  Included..............  Disability pension--   Included.............  Sec.  3.262(g).
                                                                                      Excluded Death
                                                                                      pension--Included.
(19) Retirement pay waived under     Excluded..............  Excluded..............  Excluded.............  ......do.............  Sec.  3.262(h).
 Federal statute.
(20) Department of Veterans Affairs
 payments:
  Pension..........................  Excluded..............  Excluded..............  Excluded.............  Excluded.............
  Compensation and dependency and    ......do..............  ......do..............  ......do.............  ......do.............
   indemnity compensation.
  World War I adjusted compensation  ......do..............  Included..............  ......do.............  Included.............
  U.S. Government life insurance or  Excluded..............  Excluded..............  Excluded.............  Excluded.............
   national service life insurance
   for disability or death,
   maturity of endowment policies,
   and dividends, including special
   and termination dividends.
  Servicemembers' group life         ......do..............  ......do..............  ......do.............  ......do.............
   insurance.
  Veterans' group life insurance...  ......do..............  ......do..............  ......do.............  ......do.............
  Servicemembers' indemnity........  ......do..............  ......do..............  ......do.............  ......do.............
  Subsistence allowance (38 U.S.C.   Included..............  Included..............  Included.............  Included.............
   ch. 31).
  Veterans educational assistance    ......do..............  ......do..............  ......do.............  ......do.............
   in excess of amounts expended
   for training (38 U.S.C. ch. 34).
  Educational assistance (38 U.S.C.  ......................  ......................  Excluded.............  Excluded.............
   ch. 35).
  Special allowance under 38 U.S.C.  Excluded..............  Included..............  ......do.............  Included.............
   1312(a).
  Statutory burial allowance.......  ......do..............  Excluded..............  ......do.............  Excluded.............
  Accrued..........................  ......do..............  Included, except        ......do.............  Included, except
                                                              accrued as                                     accrued as
                                                              reimbursement.                                 reimbursement.
(21) Compensation (civilian) for     Included..............  Included..............  Included.............  Included.............  Sec.  3.262(i).
 injury or death.
(22) Contributions by a public or
 private employer to a:
  Public or private health or        Excluded..............  Excluded..............  Excluded.............  Excluded.............
   hospitalization plan for an
   active or retired employee.
  Retired employee as reimbursement  Included..............  Included..............  Excluded.............  Excluded.............
   for premiums for supplementary
   medical insurance benefits under
   the Social Security Program
   (Pub. L. 91-588; 84 Stat. 1580).
(23) Overtime pay; Government        Included..............  Included..............  Disability pension--   Included.............
 employees.                                                                           Excluded. Death
                                                                                      pension--Included.
(24) Commercial life insurance;      Included (as received)  Included (as received)  Included (special      Included (as           Sec.  3.262(j).
 disability, accident, or health                                                      provision).            received).
 insurance, less payments of
 medical or hospital expenses
 resulting from the accident or
 disease for which payments are
 made.
(25) Commercial annuities or         ......do..............  Included (special       ......do.............  Included (special      Sec.  3.262(j).
 endowments.                                                  provision).                                    provision).
(26) Dividends from commercial       Excluded..............  Excluded..............  Excluded.............  Excluded.............
 insurance.
(27) Insurance under Merchant        Included..............  Included..............  Included.............  Included.............
 Marine Act of 1936, as amended.
(28) Reimbursement for casualty      Included..............  Excluded..............  Included.............  Included.............  Sec.  3.262(t)
 loss (Pub. L. 100-687).
Other fire Insurance...............  Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(t)
(29) Bequests, devises and
 inheritances:
  Property.........................  Included..............  Excluded..............  Included.............  ......do.............  Sec.  3.262(k).

[[Page 208]]

 
  Money............................  ......do..............  Included..............  ......do.............  Included.............
  Joint bank accounts..............  ......do..............  ......do..............  ......do.............  Excluded.............  Sec.  3.262(k)(1).
(30) Profit from sale of property..  Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(k).
(31) Jury duty or obligatory civic   ......do..............  ......do..............  ......do.............  ......do.............
 duties.
(32) Relocation payments (Pub. L.    ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(c).
 90-448; Pub. L. 90-495).
(33) The following programs
 administered by the ACTION Agency:
  Foster Grandparent Program and     ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(q)(1).
   Older Americans Community
   Service Programs payments (Pub.
   L. 93-29; 87 Stat. 55).
  Volunteers in Service to America   ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(q)(2).
   (VISTA), University Year for
   ACTION (UYA), Program for Local
   Services (PLS), ACTION
   Cooperative Volunteers (ACV),
   Foster Grandparent Program
   (FGP), and Older American
   Community Service Programs,
   Retired Senior Volunteer Program
   (RSVP), Senior Companion Program
   (Pub. L. 93-113; 87 Stat. 394).
(34) The Service Corps of Retired    ......do..............  ......do..............  ......do.............  ......do.............  Sec.  3.262(q)(2).
 Executives (SCORE) and Active
 Corps of Executives (ACE)
 administered by the Small Business
 Administration. (Pub. L. 93-113;
 87 Stat. 394).
(35) Agent Orange settlement         Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(s)
 payments (Pub. L. 101-201).
(36) Restitution to individuals of   Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(u)
 Japanese ancestry (Pub. L. 100-
 383).
(37) Income received by American     Excluded..............  Excluded..............  Excluded.............  Excluded.............  3.262(v)
 Indian beneficiaries from Trust or
 Restricted lands (Pub. L. 103-66).
(38) Income received under Section   Excluded..............  Excluded..............  Included.............  Included.............  3.262(w)
 6 of the Radiation Exposure
 Compensation Act (Pub. L. 101-426).
(39) Cash, stock, land or other      Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(x)
 interests received from a Native
 Corporation under the Alaska
 Native Claims Settlement Act (43
 U.S.C. 1601 et seq.).
(40) Monetary allowance under 38     Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262(y)
 U.S.C. chapter 18 for certain
 individuals who are children of
 Vietnam veterans (38 U.S.C.
 1823(c)).
(41) Income received under the       Excluded \1\..........  Excluded \1\..........  Excluded \1\.........  Excluded \1\.........  Sec.  3.262(z)
 Victims of Crime Act of 1984 (42
 U.S.C. 10601-10605)..
(42) Income received under the       Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.  3.262 (aa)
 Medicare prescription drug
 discount card and transitional
 assistance program (42 U.S.C.
 1395w-141(g)(6)).
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ The compensation received through a crime victim compensation program will be excluded from income computations unless the total amount of
  assistance received from all federally funded programs is sufficient to fully compensate the claimant for losses suffered as a result of the crime.

    (b) Deduction of amounts paid by claimant.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                        Pension; old-law     Pension; section 306
                                                                 Dependency and       (veterans, surviving   (veterans, surviving
             Deduction                Dependency (parents)   indemnity compensation       spouses, and           spouses, and               See
                                                                                           children)              children)
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) Unusual medical expenses.......  Not authorized........  Authorized............  Not authorized.......  Authorized...........  Sec. Sec.
                                                                                                                                    3.262(b)(1) and (1).
(2) Veteran: just debts, expenses    Not authorized........  Authorized, except      Not authorized.......  Authorized...........  Sec. Sec.  3.262(m)
 of last illness and burial.                                  debts.                                                                and (o).

[[Page 209]]

 
(3) Veteran's spouse or child:       Not authorized........  Not authorized........  Not authorized.......  Authorized...........  Sec.  3.262(n).
 expenses of last illness and
 burial.
(4) Parent's spouse: just debts;     Not authorized........  Authorized............  .....................  .....................  Sec.  3.262(o).
 expenses of last illness and
 burial.
(5) Prepayment on real property      Not authorized........  Not authorized........  Not authorized.......  Authorized...........  Sec. Sec.
 mortgages after death of spouse                                                                                                    3.262(k)(6).
 (Pub. L. 91-588).
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (c) Corpus of estate.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                             Pension; section 306
                                                                 Dependency and         Pension; old-law     (veterans, surviving
                                      Dependency (parents)   indemnity compensation    (veterans, widows,        spouses, and               See
                                                                                         and children)            children)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Considered              Not considered........  Not considered.......  Considered...........  Sec.  3.263.
                                      conditionally........
--------------------------------------------------------------------------------------------------------------------------------------------------------


[28 FR 31, Jan. 1, 1963, as amended at 29 FR 15205, Nov. 11, 1964; 31 FR 
15632, Dec. 13, 1966; 33 FR 15286, Oct. 15, 1968; 36 FR 8446, May 6, 
1971; 37 FR 6677, Apr. 1, 1972; 37 FR 7092, Apr. 8, 1972; 37 FR 21436, 
Oct. 11, 1972; 38 FR 872, Jan. 5, 1973; 38 FR 26804, Sept. 26, 1973; 38 
FR 28826, Oct. 17, 1973; 40 FR 13305, Mar. 26, 1975; 40 FR 57459, Dec. 
10, 1975; 41 FR 17386, Apr. 26, 1976; 42 FR 43834, Aug. 31, 1977; 57 FR 
59298, Dec. 15, 1992; 58 FR 12174, Mar. 3, 1993; 58 FR 31909, June 7, 
1993; 58 FR 33766, June 21, 1993; 59 FR 37696, July 25, 1994; 60 FR 
2522, Jan. 10, 1995; 60 FR 18355, Apr. 11, 1995; 62 FR 51278, Sept. 30, 
1997; 67 FR 49586, July 31, 2002; 68 FR 60852, Oct. 24, 2003; 70 FR 
15591, Mar. 28, 2005]



Sec. 3.262  Evaluation of income.

    (a) Total income. All income from sources such as wages, salaries, 
earnings, bonuses from employers, income from a business or profession 
or from investments or rents as well as the fair value of personal 
services, goods or room and board received in lieu thereof will be 
included.
    (1) Salary is not determined by ``takehome'' pay, but includes 
deductions made under a retirement act or plan and amounts withheld by 
virtue of income tax laws.
    (2) The gross income from a business or profession may be reduced by 
the necessary operating expenses, such as cost of goods sold, or 
expenditures for rent, taxes, and upkeep. Depreciation is not a 
deductible expense. The cost of repairs or replacement may be deducted. 
The value of an increase in stock inventory of a business is not 
considered income.
    (3) A loss sustained in operating a business, profession, or farm or 
from investments may not be deducted from income derived from any other 
source.
    (b) Income of spouse. Income of the spouse will be determined under 
the rules applicable to income of the claimant.
    (1) Parents. Where the mother and father, or remarried parent and 
spouse are living together, the total combined income will be considered 
in determining dependency, or in determining the rate of dependency and 
indemnity compensation payable to the parent. This rule is equally 
applicable where both parents have remarried and each is living with his 
or her spouse. If the remarriage of a parent has been terminated, or the 
parent is separated from his or her spouse, income of the spouse will be 
excluded.
    (2) Veterans. The separate income of the spouse of a disabled 
veteran who is entitled to pension under laws in effect on June 30, 
1960, will not be considered. Where pension is payable under section 
306(a) of Pub. L. 95-588, to a veteran who is living with a spouse there 
will

[[Page 210]]

be included as income of the veteran all income of the spouse in excess 
of whichever is the greater, the amount of the spouse income exclusion 
specified in section 306(a)(2)(B) of Pub. L. 95-588 as increased from 
time to time under section 306 (a)(3) of Pub. L. 95-588 or the total 
earned income of the spouse, which is reasonably available to or for the 
veteran, unless hardship to the veteran would result. Each time there is 
an increase in the spouse income exclusion pursuant to section 306(a)(3) 
of Pub. L. 95-588, the actual amount of the exclusion will be published 
in the ``Notices'' section of the Federal Register. The presumption that 
inclusion of such income is available to the veteran and would not work 
a hardship on him or her may be rebutted by evidence of unavailability 
or of expenses beyond the usual family requirements.


(Authority: 38 U.S.C. 1521(f); sec. 306(a)(2)(B) of Pub. L. 95-588)

    (c) Maintenance. The value of maintenance furnished by a relative, 
friend, or a charitable organization (civic or governmental) will not be 
considered income. Where the claimant is maintained in a rest home or 
other community institution or facility, public or private, because of 
impaired health or advanced age, money paid to the home or to the 
claimant to cover the cost of maintenance will not be considered income, 
regardless of whether it is furnished by a relative, friend or 
charitable organization. The expense of maintenance is not deductible if 
it is paid from the claimant's income, except as provided in paragraph 
(l) of this section in claims for dependency and indemnity compensation.
    (d) Charitable donations. Charitable donations from public or 
private relief or welfare organizations will not be considered income 
except in claims for pension under laws in effect on June 30, 1960. In 
the latter cases, additional charitable allowances received by a 
claimant for members of his or her family may not be divided per capita 
in determining the amount of the claimant's income.
    (e) Retirement benefits; general. Retirement benefits, including an 
annuity or endowment, paid under a Federal, State, municipal, or private 
business or industrial plan are considered income as limited by this 
paragraph. Where the payments received consist of part principal and 
part interest, interest will not be counted separately.
    (1) Protected pension. Except as provided in this paragraph (e)(1), 
effective January 1, 1965, in determining income for pension purposes 
under laws in effect on June 30, 1960, 10 percent of the retirement 
payments received by a veteran, surviving spouse, or child will be 
excluded. The remaining 90 percent will be considered income as 
received. Where the retirement benefit is based on the claimant's own 
employment, payments will not be considered income until the amount of 
the claimant's personal contribution (as distinguished from amounts 
contributed by the employer) has been received. Thereafter the 10 
percent exclusion will apply.
    (2) Pension; Pub. L. 86-211. Except as provided in this 
subparagraph, effective January 1, 1965, in determining income for 
pension purposes, under Pub. L. 86-211 (73 Stat. 432), 10 percent of the 
retirement payments received by a veteran, the veteran's spouse, 
surviving spouse, or child will be excluded. The remaining 90 percent 
will be considered income as received. Where a person was receiving or 
entitled to receive pension and retirement benefits based on his or her 
own employment on December 31, 1964, the retirement payments will not be 
considered income until the amount of the claimant personal contribution 
(as distinguished from amounts contributed by the employer) has been 
received. Thereafter the 10 percent exclusion will apply.
    (3) Compensation. In determining dependency of a parent for 
compensation purposes, all payments will be considered income as 
received.
    (4) Dependency and indemnity compensation. Except as provided in 
this subparagraph, effective January 1, 1967, in determining income for 
dependency and indemnity compensation purposes, 10 percent of the 
retirement payments received by a deceased veteran's parent or by the 
parent's spouse will be excluded. The remaining 90 percent will be 
considered income as received.

[[Page 211]]

Where a parent was receiving or entitled to receive dependency and 
indemnity compensation and retirement benefits based on his or her own 
employment on December 31, 1966, the retirement payments will not be 
considered income until the amount of the claimant's personal 
contribution (as distinguished from amounts contributed by the employer) 
has been received. Thereafter the 10 percent exclusion will apply.


(Authority: 38 U.S.C. 1315(g), 1503(a)(6))

    (f) Social security benefits. Old age and survivor's insurance and 
disability insurance under title II of the Social Security Act will be 
considered income as a retirement benefit under the rules contained in 
paragraph (e) of this section. Benefits received under noncontributory 
programs, such as old age assistance, aid to dependent children, and 
supplemental security income are subject to the rules contained in 
paragraph (d) of this section applicable to charitable donations. The 
lumpsum death payment under title II of the Social Security Act will be 
considered as income except in claims for dependency and indemnity 
compensation and for pension under Pub. L. 86-211 (73 Stat. 432).
    (g) Railroad retirement benefits--(1) Parents, surviving spouses and 
children. Retirement benefits received from the Railroad Retirement 
Board will be considered as income under the rules contained in 
paragraph (e) of this section. (See paragraph (h) of this section as to 
waivers.)
    (2) Veterans. Effective July 1, 1959, retirement benefits received 
from the Railroad Retirement Board were excluded from consideration as 
income in determining eligibility for disability pension. (45 U.S.C. 
228s-1) This exclusion continues to be applicable to claims under laws 
in effect on June 30, 1960. For purposes of section 306 pension, such 
retirement benefits will be considered as income under the rules 
contained in paragraph (e) of this section.
    (h) Retirement benefits waived. Except as provided in this 
paragraph, retirement benefits (pension or retirement payments) which 
have been waived will be included as income. For the purpose of 
determining dependency of a parent, or eligibility of a parent for 
dependency and indemnity compensation or eligibility of a veteran, 
surviving spouse, or child for pension under laws in effect on June 30, 
1960, retirement benefits from the following sources which have been 
waived pursuant to Federal statute will not be considered as income:
    (1) Civil Service Retirement and Disability Fund;
    (2) Railroad Retirement Board (see paragraph (g)(2) of this 
section);
    (3) District of Columbia, firemen, policemen, or public school 
teachers;
    (4) Former lighthouse service.
    (i) Compensation (civilian) for injury or death. (1) Compensation 
paid by the Bureau of Employees' Compensation, Department of Labor (of 
the United States), or by Social Security Administration, or by Railroad 
Retirement Board, or pursuant to any workmen's compensation or 
employer's liability statute, or damages collected because of personal 
injury or death, less medical, legal, or other expenses incident to the 
injury or death, or the collection or recovery of such moneys will be 
considered income as received, except as provided in paragraph (i)(2) of 
this section. The criteria of paragraph (i)(1) of this section are for 
application as to all medical expenditures after such award or 
settlement.


(Authority: Pub. L. 92-198, 85 Stat. 663)

    (2) For pension, effective October 7, 1966, and for dependency and 
indemnity compensation effective January 1, 1967, if payments based on 
permanent and total disability or death are received from the Bureau of 
Employees' Compensation, Social Security Administration or Railroad 
Retirement Board, or pursuant to any workmen's compensation or 
employer's liability statute, there will be excluded 10 percent of the 
payments received after deduction of medical, legal, and other expenses 
as authorized by paragraph (i)(1) of this section. The 10 percent 
exclusion does not apply to damages collected incident to a tort suit 
under other than an employer's liability law of the United States or a 
political subdivision of the United States, or to determinations of 
dependency for compensation purposes.

[[Page 212]]

    (j) Commercial insurance--(1) Annuity or endowment insurance. For 
pension, effective January 1, 1965, or for dependency and indemnity 
compensation, effective January 1, 1967, the provisions of paragraph (e) 
of this section apply. In such cases, 10 percent of the payments 
received will be excluded. In dependency and indemnity compensation 
claims, where the parent is receiving or entitled to receive dependency 
and indemnity compensation on December 31, 1966, and is also receiving 
or entitled to receive annuity payments on that date, or endowment 
insurance matures on or before that date, no part of the payments 
received will be considered income until the full amount of the 
consideration has been received, after which 10 percent of the amount 
received will be excluded. For compensation, the full amount of each 
payment is considered income as received.
    (2) Life insurance; general. In determining dependency, or 
eligibility for dependency and indemnity compensation, or for section 
306 pension the full amount of payments is considered income as 
received. For section 306 pension, effective October 7, 1966, and for 
dependency and indemnity compensation, effective January 1, 1967, 10 
percent of the payments received will be excluded.
    (3) Life insurance; old-law pension. For pension under laws in 
effect on June 30, 1960, 10 percent of the payments received will be 
excluded. Where it is considered that life insurance was received in a 
lump sum in the calendar year in which the veteran died and payments are 
actually received in succeeding years, no part of the payments received 
in succeeding years will be considered income until an amount equal to 
the lump-sum face value of the policy has been received, after which 10 
percent of the payments received will be excluded. The 10 percent 
exclusion is authorized effective October 7, 1966.
    (4) Disability, accident or health insurance. For pension, effective 
October 7, 1966, and for dependency and indemnity compensation, 
effective January 1, 1967, there will be excluded 10 percent of the 
payments received for disability after deduction of medical, legal, or 
other expenses incident to the disability. For compensation, after 
deduction of such expenses, the full amount of payments is considered 
income as received.
    (k) Property--(1) Ownership. The terms of the recorded deed or other 
evidence of title will constitute evidence of ownership of real or 
personal property. This includes property acquired through purchase, 
bequest or inheritance except that, effective January 1, 1971, amounts 
in joint accounts in banks and similar institutions acquired by reason 
of the death of another joint owner shall not be considered income of a 
survivor for section 306 pension purposes. With the foregoing exception, 
if property is owned jointly each person will be considered as owning a 
proportionate share. The claimant's share of property held in 
partnership will be determined on the facts found. In the absence of 
evidence to the contrary, the claimant's statement as to the terms of 
ownership will be accepted.


(Authority: Sec. 306, Pub. L. 95-588; 92 Stat. 2508)

    (2) Income-producing property. Income received from real or personal 
property owned by the claimant will be counted. The claimant's share 
will be determined in proportion to his right according to the rules of 
ownership.
    (3) Sale of property. Except as provided in paragraphs (k)(4) and 
(5) of this section, net profit from the sale of real or personal 
property will be counted. In determining net profit from the sale of 
property owned prior to the date of entitlement, the value at the date 
of entitlement will be considered in relation to the selling price. 
Where payments are received in installments, payments will not be 
considered income until the claimant has received amounts equal to the 
value of the property at the date of entitlement. Principal and interest 
will not be counted separately.
    (4) Homes. Net profit from the sale of the claimant's residence 
which is received during the calendar year of sale will not be 
considered as income under the following conditions:
    (i) To the extent that it is applied within the calendar year of the 
sale, or the succeeding calendar year, to the purchase price of another 
residence as his principal dwelling;

[[Page 213]]

    (ii) Such application of the net profit is reported within 1 year 
following the date so applied, and
    (iii) The net profit is so applied after January 10, 1962, to a 
purchase made after said date.

This exclusion will not apply where the net profit is applied to the 
price of a home purchased earlier than the calendar year preceding the 
calendar year of sale of the old residence.
    (5) Sale of property; section 306 pension and dependency and 
indemnity compensation. For pension under section 306 pension and for 
dependency and indemnity compensation, profit from the sale of real or 
personal property other than in the course of a business will not be 
considered income. This applies to property acquired either before or 
after the date of entitlement. Any amounts received in excess of the 
sales price will be counted as income. Where payments are received in 
installments, principal and interest will not be counted separately. For 
pension, this provision is effective January 1, 1965; for dependency and 
indemnity compensation, January 1, 1967.


(Authority: 38 U.S.C. 1503(a)(10); 38 U.S.C. 1315(g))

    (6) Payments on mortgages on real property; section 306 pension. 
Effective January 1, 1971, for the purposes of section 306 pension, an 
amount equaling any prepayments made by a veteran or surviving spouse on 
a mortgage or similar type security instrument in existence at the death 
of veteran or spouse on real property which prior to the death was the 
principal residence of the veteran and spouse will be excluded from 
consideration as income if such payment was made after the death and 
prior to the close of the year succeeding the year of death.


(Authority: 38 U.S.C. 1503(a)(14))

    (l) Unusual medical expenses. Within the provisions of paragraphs 
(l)(1) through (4) of this section there will be excluded from the 
amount of the claimant's annual income any unreimbursed amounts which 
have been paid within the calendar year for unusual medical expenses 
regardless of the year the indebtedness was incurred. The term unusual 
means excessive. It does not describe the nature of a medical condition 
but rather the amount expended for medical treatment in relationship to 
the claimant's resources available for sustaining a reasonable mode of 
life. Unreimbursed expenditures which exceed 5 percent of the claimant's 
reported annual income will be considered unusual. Health, accident, 
sickness and hospitalization insurance premiums will be included as 
medical expenses in determining whether the claimant's unreimbursed 
medical expenses meet the criterion for unusual. A claimant's statement 
as to amounts expended for medical expenses ordinarily will be accepted 
unless the circumstances create doubt as to its credibility. An estimate 
based on a clear and reasonable expectation that unusual medical 
expenditure will be realized may be accepted for the purpose of 
authorizing prospective payments of benefits subject to necessary 
adjustment in the award upon receipt of an amended estimate or after the 
end of the calendar year upon receipt of an income questionnaire.
    (1) Veterans. For the purpose of section 306 pension, there will be 
excluded unreimbursed amounts paid by the veteran for unusual medical 
expenses of self, spouse, and other relatives of the veteran in the 
ascending as well as descending class who are members or constructive 
members of the veteran's household and whom the veteran has a moral or 
legal obligation to support.
    (2) Surviving spouses. For the purpose of section 306 pension, there 
will be excluded unreimbursed amounts paid by the surviving spouse for 
the unusual medical expenses of self, the veteran's children, and other 
relatives of the surviving spouse in the ascending as well as descending 
class who are members or constructive members of the surviving spouse's 
household and whom the surviving spouse has a moral or legal obligation 
to support.
    (3) Children. For the purpose of section 306 pension, there will be 
excluded unreimbursed amounts paid by a child for the unusual medical 
expenses of self, parent, and brothers and sisters of the child.
    (4) Parents. For dependency and indemnity compensation purposes 
there

[[Page 214]]

will be excluded unreimbursed amounts paid by the parent for the unusual 
medical expenses of self, spouse, and other relatives of the parent in 
the ascending as well as descending class who are members or 
constructive members of the parent's household and whom the parent has a 
moral or legal obligation to support. If the combined annual income of 
the parent and the parent's spouse is the basis for dependency and 
indemnity compensation, the exclusion is applicable to the combined 
annual income and extends to the unusual unreimbursed medical expenses 
of the spouse's relatives in the ascending as well as descending class 
who are members or constructive members of the household and whom the 
parent's spouse has a moral or legal obligation to support.


(Authority: 38 U.S.C. 1315(f)(3); Sec. 306, Pub. L. 95-588; 92 Stat. 
2508)

    (m) Veteran's final expenses; pension. In claims for pension under 
section 306, there will be excluded, as provided in paragraph (p) of 
this section:
    (1) From the income of a surviving spouse, amounts equal to amounts 
paid for the expenses of the veteran's last illness;
    (2) From the income of a surviving spouse, or of a child of a 
deceased veteran where there is no surviving spouse, amounts equal to 
amounts paid by the surviving spouse or child for the veteran's just 
debts, for the expenses of the veteran's last illness, and burial to the 
extent such expenses are not reimbursed by the Department of Veterans 
Affairs. The term ``just debts'' does not include any debt that is 
secured by real or personal property.


(Authority: Sec. 306, Pub. L. 95-588; 92 Stat. 2508)

    (n) Final expenses of veteran's spouse or child; pension. In claims 
for pension under section 306, there will be excluded, as provided in 
paragraph (p) of this section:
    (1) From the income of a veteran, amounts equal to amounts paid by 
the veteran for the last illness and burial of the veteran's deceased 
spouse or child; and
    (2) From the income of a spouse or surviving spouse, amounts equal 
to amounts paid by her as spouse or surviving spouse of the deceased 
veteran for the last illness and burial of a child of such veteran.


(Authority: Sec. 306, Pub. L. 95-588; 92 Stat. 2508)

    (o) Final expenses of veteran or parent's spouse; dependency and 
indemnity compensation. In claims for dependency and indemnity 
compensation there will be excluded from the income of a parent, as 
provided in paragraph (p) of this section, amounts equal to amounts paid 
by the parent for:
    (1) The expenses of the veteran's last illness and burial to the 
extent that such expenses are not reimbursed under 38 U.S.C. ch. 23.
    (2) The parent's deceased spouse's just debts, the expenses of the 
spouse's last illness to the extent such expenses are not reimbursed 
under 38 U.S.C. ch. 51 and the expenses of the spouse's burial to the 
extent that such expenses are not reimbursed under 38 U.S.C. ch. 23 or 
51. The term ``just debts'' does not include any debt that is secured by 
real or personal property.


(Authority: 38 U.S.C. 1315(f))

    (p) Final expenses; year of exclusion. For the purpose of paragraphs 
(m), (n) and (o) of this section, in the absence of contradictory 
information, the claimant's statement will be accepted as to the nature, 
amount and date of payment, and identity of the creditor. Except as 
provided in this paragraph, payments will be deducted from annual income 
for the year in which such payments are made. Payments made by a 
veteran, the spouse or surviving spouse of a veteran, child or, in 
dependency and indemnity compensation claims, by a parent during the 
calendar year following the year in which the veteran, spouse or child 
died may be deducted from the claimant's income for the year of last 
illness or burial if this deduction is advantageous to the claimant.
    (q) Volunteer programs--(1) Payments under Foster Grandparent 
Program and Older Americans Community Service Programs. Effective May 3, 
1973, compensation received under the Foster Grandparent Program and the 
Older Americans Community Service Programs

[[Page 215]]

will be excluded from income in claims for compensation, pension and 
dependency and indemnity compensation.


(Authority: Pub. L. 93-29; 87 Stat. 55)

    (2) Payments under domestic volunteer service act programs. 
Effective October 1, 1973, compensation or reimbursement received under 
a Domestic Volunteer Service Act Program (including Volunteers in 
Service to America (VISTA), University Year for ACTION (UYA), Program 
for Local Services (PLS), ACTION Cooperative Volunteers (ACV), Foster 
Grandparent Program (FGP) and Older American Community Service Program, 
Retired Senior Volunteer Program (RSVP), Senior Companion Program, 
Service Corps of Retired Executives (SCORE) and Active Corps of 
Executives (ACE), will be excluded from income in claims for 
compensation, pension and dependency and indemnity compensation.


(Authority: Pub. L. 93-113; 87 Stat. 394)

    (r) Survivor benefit annuity. For the purposes of old law pension 
and section 306 pension, there shall be excluded from computation of 
income annuity paid by the Department of Defense under the authority of 
section 653, Public Law 100-456 to qualified surviving spouses of 
veterans who died prior to November 1, 1953. (September 29, 1988)


(Authority: Sec. 653, Pub. L. 100-456; 102 Stat. 1991)

    (s) Agent Orange settlement payments. In claims for pension and 
parents' dependency and indemnity income, there shall be excluded from 
computation of income payments received by any person in the case of In 
re Agent Orange Product Liability Litigation in the United States 
District Court for the Eastern District of New York (MDL No. 381). 
(January 1, 1989)


(Authority: Pub. L. 101-201, 103 Stat. 1795)

    (t) Reimbursement for casualty loss. The following sources of 
reimbursements for casualty loss will not be considered as income in 
determining entitlement to benefits under the programs specified. 
Amounts to be excluded from computation in parens' dependency and 
indemnity compensation claims are limited to amounts of reimbursement 
which do not exceed the greater of the fair market value or the 
reasonable replacement cost of the property involved at the time 
immediately preceding the loss.
    (1) Reimbursement for casualty loss of any kind in determining 
entitlement to parents' dependency and indemnity compensation benefits. 
For purposes of paragraph (t) of this section, the term ``casualty 
loss'' means the complete or partial destruction of property resulting 
from an identifiable event of a sudden, unexpected or unusual nature.
    (2) Proceeds from fire insurance in determining dependency of a 
parent for compensation purposes or in determining entitlement to old-
law and section 306 pension benefits.


(Authority: 38 U.S.C. 1315(f))

    (u) Restitution to individuals of Japanese ancestry. Effective 
August 10, 1988, for the purposes of old law pension, section 306 
pension, parents' death compensation, and parents' dependency and 
indemnity compensation, there shall be excluded from income computation 
any payment made as restitution under Public Law 100-383 to individuals 
of Japanese ancestry who were interned, evacuated, or relocated during 
the period December 7, 1941, through June 30, 1946, pursuant to any law, 
Executive order, Presidential proclamation, directive, or other official 
action respecting these individuals.
    (v) Income received by American Indian beneficiaries from trust or 
restricted lands. There shall be excluded from income computation 
payments of up to $2,000 per calendar year to an individual Indian from 
trust lands or restricted lands as defined in 25 CFR 151.2. (January 1, 
1994)


(Authority: Sec. 13736, Pub. L. 103-66; 107 Stat. 663)

    (w) Radiation Exposure Compensation Act. For the purposes of 
parents' dependency and indemnity compensation, there shall be excluded 
from income computation payments under Section 6 of the Radiation 
Exposure Compensation Act of 1990.


(Authority: 42 U.S.C. 2210 note)


[[Page 216]]


    (x) Alaska Native Claims Settlement Act. There shall be excluded 
from income computation any cash (including cash dividends on stock 
received from a Native Corporation) to the extent that it does not, in 
the aggregate, exceed $2,000 per individual per annum; stock (including 
stock issued or distributed by a Native Corporation as a dividend or 
distribution on stock); a partnership interest; land or an interest in 
land (including land or an interest in land received from a Native 
Corporation as a dividend or distribution on stock); and an interest in 
a settlement trust. (November 2, 1994)


(Authority: Sec. 506, Pub. L. 103-446)

    (y) Monetary allowance under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans. There shall be 
excluded from income computation any allowance paid under the provisions 
of 38 U.S.C. chapter 18 to or for an individual who is the child of a 
Vietnam veteran.


(Authority: 38 U.S.C. 1823(c))

    (z) Victims of Crime Act. For purposes of old law pension, section 
306 pension, and parents' dependency and indemnity compensation, amounts 
received as compensation under the Victims of Crime Act of 1984 will not 
be considered income unless the total amount of assistance received from 
all federally funded programs is sufficient to fully compensate the 
claimant for losses suffered as a result of the crime.


(Authority: 42 U.S.C. 10602(c))

    (aa) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. For purposes of old law pension, section 306 
pension, and parents' dependency and indemnity compensation, the 
payments received under the Medicare transitional assistance program and 
any savings associated with the Medicare prescription drug discount card 
will not be considered income.

(Authority: 42 U.S.C. 1395w-141(g)(6))

[28 FR 32, Jan. 1, 1963]

    Editorial Note: For Federal Register citations affecting Sec. 
3.262, see the List of CFR Sections Affected, which appears in the 
Finding Aids section of the printed volume and on GPO Access.



Sec. 3.263  Corpus of estate; net worth.

    (a) General. The following rules are for application in determining 
the corpus of estate of a parent where dependency is a factor under 
Sec. 3.250, and the net worth of a veteran, surviving spouse, or child 
where pension is subject to Pub. L. 86-211 (73 Stat. 432) under Sec. 
3.252(b). Only the estate of the parent, in claims based on dependency, 
or the estate of the veteran, surviving spouse, or child-claimant in 
claims for pension, will be considered. In the absence of contradictory 
information, the claimant's statement as to ownership and estimate of 
value will be accepted.
    (b) Definition. Corpus of estate and net worth mean the market 
value, less mortgages or other encumbrances, of all real and personal 
property owned by the claimant except the claimant's dwelling (single-
family unit) including a reasonable lot area, and personal effects 
suitable to and consistent with the claimant's reasonable mode of life.
    (c) Ownership. See Sec. 3.262(k).
    (d) Evaluation. In determining whether some part of the claimant's 
estate should be consumed for his or her maintenance, consideration will 
be given to the amount of the claimant's income, together with the 
following factors: whether the property can be readily converted into 
cash at no substantial sacrifice; ability to dispose of property as 
limited by community property laws; life expectancy; number of 
dependents who meet the requirements of Sec. 3.250(b)(2); potential 
rate of depletion, including unusual medical expenses under the 
principles outlined in Sec. 3.262(l) for the claimant and his or her 
dependents.
    (e) Agent Orange settlement payments. There shall be excluded from 
the corpus of estate or net worth of a claimant any payment made from 
the Agent Orange Settlement Fund or any other fund established pursuant 
to the settlement in the In re Agent Orange product liability 
litigation, M.D.L. No. 381 (E.D.N.Y.). (January 1, 1989)


(Authority: Pub. L. 101-201, 103 Stat. 1795)

    (f) Restitution to individuals of Japanese ancestry. Effective 
August 10, 1988,

[[Page 217]]

for the purposes of section 306 pension and parents' death compensation, 
there shall be excluded from the corpus of estate or net worth of a 
claimant any payment made as restitution under Public Law 100-383 to 
individuals of Japanese ancestry who were interned, evacuated, or 
relocated during the period December 7, 1941, through June 30, 1946, 
pursuant to any law, Executive order, Presidential proclamation, 
directive, or other official action respecting these individuals.


(Authority: Sec. 105, Pub. L. 100-383; 102 Stat. 905; Sec. 6. Pub. L. 
102-371; 106 Stat. 1167, 1168)

    (g) Monetary allowance under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans. There shall be 
excluded from the corpus of estate or net worth of a claimant any 
allowance paid under the provisions of 38 U.S.C. chapter 18 to or for an 
individual who is a child of a Vietnam veteran.


(Authority: 38 U.S.C. 1823(c))

    (h) Victims of Crime Act. There shall be excluded from the corpus of 
estate or net worth of a claimant any amounts received as compensation 
under the Victims of Crime Act of 1984 unless the total amount of 
assistance received from all federally funded programs is sufficient to 
fully compensate the claimant for losses suffered as a result of the 
crime.


(Authority: 42 U.S.C. 10602(c))

    (i) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. There shall be excluded from the corpus of estate or 
net worth of a claimant payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))

    Cross References: Reductions and discontinuances; dependency. See 
Sec. 3.500(h). Material change in income, net worth or change in 
status. See Sec. 3.660. Income and net worth questionnaires. See Sec. 
3.661.

[28 FR 33, Jan. 1, 1963, as amended at 39 FR 28527, Aug. 8, 1974; 44 FR 
45936, Aug. 6, 1979; 57 FR 59299, Dec. 15, 1992; 58 FR 33767, June 21, 
1993; 62 FR 51279, Sept. 30, 1997; 67 FR 49587, July 31, 2002; 68 FR 
60852, Oct. 24, 2003; 70 FR 15591, Mar. 28, 2005]



Sec. 3.270  Applicability of various dependency, income and estate regulations.

    (a) Sections 3.250 to 3.270. These sections are applicable to 
dependency, income and estate determinations needed to determine 
entitlement or continued entitlement for the following programs:
    (1) Parents' death compensation.
    (2) Old-law pension.
    (3) Section 306 pension.
    (4) Parents' dependency and indemnity compensation.

    Note: Citations to title 38 U.S.C. in Sec. Sec. 3.250 to 3.270 
referring to section 306 or old-law pension generally refer to 
provisions of law in effect on December 31, 1978.

    (b) Sections 3.271 to 3.300. These sections apply to income and 
estate determinations of entitlement to the improved disability and 
death pension program which became effective January 1, 1979.

[44 FR 45936, Aug. 6, 1979]

  Regulations Applicable to the Improved Pension Program Which Became 
                        Effective January 1, 1979

    Source: 44 FR 45936, Aug. 6, 1979, unless otherwise noted.



Sec. 3.271  Computation of income.

    (a) General. Payments of any kind from any source shall be counted 
as income during the 12-month annualization period in which received 
unless specifically excluded under Sec. 3.272.


(Authority: 38 U.S.C. 501)

    (1) Recurring income. Recurring income means income which is 
received or anticipated in equal amounts and at regular intervals (e.g., 
weekly, monthly, quarterly, etc.), and which will continue throughout an 
entire 12-month annualization period. The amount of recurring income for 
pension purposes

[[Page 218]]

will be the amount received or anticipated during a 12-month 
annualization period. Recurring income which terminates prior to being 
counted for at least one full 12-month annualization period will be 
treated as nonrecurring income for computation purposes.
    (2) Irregular income. Irregular income means income which is 
received or anticipated during a 12-month annualization period, but 
which is received in unequal amounts or at irregular intervals. The 
amount of irregular income for pension purposes will be the amount 
received or anticipated during a 12-month annualization period following 
initial receipt of such income.
    (3) Nonrecurring income. Nonrecurring income means income received 
or anticipated on a one-time basis during a 12-month annualization 
period (e.g., an inheritance). Pension computations of income will 
include nonrecurring income for a full 12-month annualization period 
following receipt of the income.
    (b) Salary. Salary means the gross amount of a person's earnings or 
wages before any deductions are made for such things as taxes, 
insurance, retirement plans, social security, etc.
    (c) Business, farm or professional income. (1) This includes gross 
income from a business, farm or profession as reduced by the necessary 
operating expenses such as cost of goods sold, or expenditures for rent, 
taxes, and upkeep, or costs of repairs or replacements. The value of an 
increase in stock inventory of a business is not considered income.
    (2) Depreciation is not a deductible expense.
    (3) A loss sustained in operating a business, profession, farm, or 
from investments, may not be deducted from income derived from any other 
source.
    (d) Income from property. Income from real or personal property is 
countable as income of the property's owner. The terms of a recorded 
deed or other evidence of title shall constitute evidence of ownership. 
This includes property acquired through purchase, gift, devise, or 
descent. If property is owned jointly, income of the various owners 
shall be determined in proportion to shares of ownership of the 
property. The owner's shares of income held in partnership shall be 
determined on the basis of the facts found.
    (e) Installments. Income shall be determined by the total amount 
received or anticipated during a 12-month annualization period.


(Authority: 38 U.S.C. 501)

    (f) Deferred determinations. (1) When an individual is unable to 
predict with certainty the amount of countable annual income, the annual 
rate of improved pension shall be reduced by the greatest amount of 
anticipated countable income until the end of the 12-month annualization 
period, when total income received during that period will be determined 
and adjustments in pension payable made accordingly.


(Authority: 38 U.S.C. 501)

    (2) When a claimed dependent is shown to have income which exceeds 
the additional amount of benefits payable based on the claimed 
dependency, but evidence requirements of Sec. 3.204, Sec. 3.205, Sec. 
3.209, or Sec. 3.210 have not been met, the maximum annual rate of 
improved pension shall be determined without consideration of the 
claimed dependency. This amount shall be reduced by an amount which 
includes the income of the unestablished dependent. Adjustments in 
computation of the maximum annual rate of improved pension shall occur 
following receipt of evidence necessary to establish the dependency.


(Authority: 38 U.S.C. 501(a))

    (g) Compensation (civilian) for injury or death. Compensation paid 
by the United States Department of Labor, Office of Workers' 
Compensation Programs, Social Security Administration, or the Railroad 
Retirement Board, or pursuant to any worker's compensation or employer's 
liability statute, or damages collected because of personal injury or 
death, will be considered income as received. However, medical, legal or 
other expenses incident to the injury or death, or incident to the 
collection or recovery of the amount of the award or settlement, may be 
deducted. The criteria in

[[Page 219]]

Sec. 3.272(g) apply as to all medical expenditures after the award or 
settlement.


(Authority: 38 U.S.C. 501)

    (h) Fractions of dollars. Fractions of dollars will be disregarded 
in computing annual income.

[44 FR 45936, Aug. 6, 1979, as amended at 53 FR 23235, June 21, 1988; 57 
FR 59299, Dec. 15, 1992]



Sec. 3.272  Exclusions from income.

    The following shall be excluded from countable income for the 
purpose of determining entitlement to improved pension. Unless otherwise 
provided, expenses deductible under this section are deductible only 
during the 12-month annualization period in which they were paid.


(Authority: 38 U.S.C. 501)

    (a) Welfare. Donations from public or private relief, welfare, or 
charitable organizations.


(Authority: 38 U.S.C. 1503(a)(1))

    (b) Maintenance. The value of maintenance furnished by a relative, 
friend, or a charitable organization (civic or governmental) will not be 
considered income. Where the individual is maintained in a rest home or 
other community institution or facility, public or private, because of 
impaired health or advanced age, money paid to the home or the 
individual to cover the cost of maintenance will not be considered 
income, regardless of whether it is furnished by a relative, friend, or 
charitable organization. The expense of maintenance is not deductible if 
it is paid from the individual's income.


(Authority: 38 U.S.C. 501, 1503(a)(1))

    (c) Department of Veterans Affairs pension benefits. Payments under 
chapter 15 of title 38, United States Code, including accrued pension 
benefits payable under 38 U.S.C. 5121.


(Authority: 38 U.S.C. 1503(a)(2))

    (d) Reimbursement for casualty loss. Reimbursement of any kind for 
any casualty loss. The amount to be excluded is not to exceed the 
greater of the fair market value or the reasonable replacement cost of 
the property involved at the time immediately preceding the loss. For 
purposes of this paragraph, the term ``casualty loss'' means the 
complete or partial destruction of property resulting from an 
identifiable event of a sudden, unexpected or unusual nature.


(Authority: 38 U.S.C. 1503(a)(5))

    (e) Profit from sale of property. Profit realized from the 
disposition of real or personal property other than in the course of 
business, except amounts received in excess of the sales price, for 
example, interest on deferred sales is included as income. In 
installment sales, any payments received until the sales price is 
recovered are not included as income, but any amounts received which 
exceed the sales price are included, regardless of whether they 
represent principal or interest.


(Authority: 38 U.S.C. 1503(a)(6))

    (f) Joint accounts. Amounts in joint accounts in banks and similar 
institutions acquired by reason of death of the other joint owner.


(Authority: 38 U.S.C. 1503(a)(7))

    (g) Medical expenses. Within the provisions of the following 
paragraphs, there will be excluded from the amount of an individual's 
annual income any unreimbursed amounts which have been paid within the 
12-month annualization period for medical expenses regardless of when 
the indebtedness was incurred. An estimate based on a clear and 
reasonable expectation that unusual medical expenditure will be realized 
may be accepted for the purpose of authorizing prospective payments of 
benefits subject to necessary adjustment in the award upon receipt of an 
amended estimate, or after the end of the 12-month annualization period 
upon receipt of an eligibility verification report.


(Authority: 38 U.S.C. 501)

    (1) Veteran's income. Unreimbursed medical expenses will be excluded 
when all of the following requirements are met:

[[Page 220]]

    (i) They were or will be paid by a veteran or spouse for medical 
expenses of the veteran, spouse, children, parents and other relatives 
for whom there is a moral or legal obligation of support;
    (ii) They were or will be incurred on behalf of a person who is a 
member or a constructive member of the veteran's or spouse's household; 
and
    (iii) They were or will be in excess of 5 percent of the applicable 
maximum annual pension rate or rates for the veteran (including 
increased pension for family members but excluding increased pension 
because of need for aid and attendance or being housebound) as in effect 
during the 12-month annualization period in which the medical expenses 
were paid.
    (2) Surviving spouse's income. Unreimbursed medical expenses will be 
excluded when all of the following requirements are met:
    (i) They were or will be paid by a surviving spouse for medical 
expenses of the spouse, veteran's children, parents and other relatives 
for whom there is a moral or legal obligation of support;
    (ii) They were or will be incurred on behalf of a person who is a 
member or a constructive member of the spouse's household; and
    (iii) They were or will be in excess of 5 percent of the applicable 
maximum annual pension rate or rates for the spouse (including increased 
pension for family members but excluding increased pension because of 
need for aid and attendance or being housebound) as in effect during the 
12-month annualization period in which the medical expenses were paid.


(Authority: 38 U.S.C. 501)

    (3) Children's income. Unreimbursed amounts paid by a child for 
medical expenses of self, parent, brothers and sisters, to the extent 
that such amounts exceed 5 percent of the maximum annual pension rate or 
rates payable to the child during the 12-month annualization period in 
which the medical expenses were paid.


(Authority: 38 U.S.C. 501)

    (h) Expenses of last illnesses, burials, and just debts. Expenses 
specified in paragraphs (h)(1) and (h)(2) of this section which are paid 
during the calendar year following that in which death occurred may be 
deducted from annual income for the 12-month annualization period in 
which they were paid or from annual income for any 12-month 
annualization period which begins during the calendar year of death, 
whichever is to the claimant's advantage. Otherwise, such expenses are 
deductible only for the 12-month annualization period in which they were 
paid.


(Authority: 38 U.S.C. 501)

    (1) Veteran's final expenses. (i) Amounts paid by a spouse before a 
veteran's death for expenses of the veteran's last illness will be 
deducted from the income of the surviving spouse.


(Authority: 38 U.S.C. 1503(a)(3))

    (ii) Amounts paid by a surviving spouse or child of a veteran for 
the veteran's just debts, expenses of last illness and burial (to the 
extent such burial expenses are not reimbursed under chapter 23 of title 
38 U.S.C.) will be deducted from the income of the surviving spouse or 
child. The term ``just debts'' does not include any debt that is secured 
by real or personal property.


(Authority: 38 U.S.C. 1503(a)(3))

    (2) Spouse or child's final expenses. (i) Amounts paid by a veteran 
for the expenses of the last illness and burial of the veteran's 
deceased spouse or child will be deducted from the veteran's income.
    (ii) Amounts paid by a veteran's spouse or surviving spouse for 
expenses of the last illness and burial of the veteran's child will be 
deducted from the spouse's or surviving spouse's income.


(Authority: 38 U.S.C. 1503(a)(4))

    (i) Educational expenses. Amounts equal to expenses paid by a 
veteran or surviving spouse pursuing a course of education or vocational 
rehabilitation or training, to include amounts paid for tuition, fees, 
books, and materials, and in the case of a veteran or surviving spouse 
in need of regular aid and attendance, unreimbursed amounts paid for 
unusual transportation expenses in connection with the pursuit

[[Page 221]]

of such course. Unusual transportation expenses are those exceeding the 
reasonable expenses which would have been incurred by a nondisabled 
person using an appropriate means of transportation (public 
transportation, if reasonably available).


(Authority: 38 U.S.C. 1503(a)(9))

    (j) Child's income. In the case of a child, any current work income 
received during the year, to the extent that the total amount of such 
income does not exceed an amount equal to the sum of the following:
    (1) The lowest amount of gross income for which a Federal income tax 
return must be filed, as specified in section 6012(a) of the Internal 
Revenue Code of 1954, by an individual who is not married (as determined 
under section 143 of such Code), and is not a surviving spouse (as 
defined in section 2(a) of such Code), and is not a head of household 
(as defined in section 2(b) of such Code); and
    (2) If the child is pursuing a course of postsecondary education or 
vocational rehabilitation or training, the amount paid by the child for 
those educational expenses including the amount paid for tuition, fees, 
books, and materials.


(Authority: 38 U.S.C. 1503(a)(10))

    (k) Domestic Volunteer Service Act Programs. Payments received under 
a Domestic Volunteer Service Act (DVSA) Program (including Volunteers in 
Service to America (VISTA), University Year for ACTION (UYA), Foster 
Grandparent Program (FGP), Retired Senior Volunteer Program (RSVP), 
Senior Companion Program) shall be excluded as provided in paragraphs 
(k)(1) and (2) of this section:
    (1) All DVSA payments received before December 13, 1979, shall be 
excluded from determining entitlement to improved pension.


(Authority: 42 U.S.C. 5044(g) (1973))

    (2) DVSA payments received after December 12, 1979, shall be 
excluded from determining entitlement to improved pension unless the 
Director of the ACTION Agency has determined that the value of all DVSA 
payments, adjusted to reflect the number of hours served by the 
volunteer, equals or exceeds the minimum wage then in effect under the 
Fair Labor Standards Act of 1938 or the minimum wage of the State where 
the volunteer served, whichever is the greater.


(Authority: 42 U.S.C. 5044(g) (1979))

    (l) Distributions of funds under 38 U.S.C. 1718. Distributions from 
the Department of Veterans Affairs Special Therapeutic and 
Rehabilitation Activities Fund as a result of participation in a 
therapeutic or rehabilitation activity under 38 U.S.C. 1718 and payments 
from participation in a program of rehabilitative services provided as 
part of the care furnished by a State home and which is approved by VA 
as conforming to standards for activities under 38 U.S.C. 1718 shall be 
considered donations from a public or private relief or welfare 
organization and shall not be countable as income for pension purposes.


(Authority: 38 U.S.C. 1718(f))

    (m) Hardship exclusion of child's available income. When hardship is 
established under the provisions of Sec. 3.23(d)(6) of this part, there 
shall be excluded from the available income of any child or children an 
amount equal to the amount by which annual expenses necessary for 
reasonable family maintenance exceed the sum of countable annual income 
plus VA pension entitlement computed without consideration of this 
exclusion. The amount of this exclusion shall not exceed the available 
income of any child or children, and annual expenses necessary for 
reasonable family maintenance shall not include any expenses which were 
considered in determining the available income of the child or children 
or the countable annual income of the veteran or surviving spouse.


(Authority: 38 U.S.C. 1521(h), 1541(g))

    (n) Survivor benefit annuity. Annuity paid by the Department of 
Defense under the authority of section 653, Public Law 100-456 to 
qualified surviving

[[Page 222]]

spouses of veterans who died prior to November 1, 1953. (September 29, 
1988)


(Authority: Sec. 653, Pub. L. 100-456; 102 Stat. 1991)

    (o) Agent Orange settlement payments. Payments received by any 
person in settlement of the case of In re Agent Orange product liability 
litigation in the United States District Court for the Eastern District 
of New York (M.D.L. No. 381). (January 1, 1989)


(Authority: Pub. L. 101-201, 103 Stat. 1795)

    (p) Restitution to individuals of Japanese ancestry. Any payment 
made as restitution under Public Law 100-383 to individuals of Japanese 
ancestry who were interned, evacuated, or relocated during the period 
December 7, 1941, through June 30, 1946, pursuant to any law, Executive 
order, Presidential proclamation, directive, or other official action 
respecting these individuals. (August 10, 1988)


(Authority: Sec. 105, Pub. L. 100-383; 102 Stat. 905)

    (q) Cash surrender value of life insurance. That portion of proceeds 
from the cash surrender of a life insurance policy which represents a 
return of insurance premiums.


(Authority: 38 U.S.C. 501(a))

    (r) Income received by American Indian beneficiaries from trust or 
restricted lands. Income of up to $2,000 per calendar year to an 
individual Indian from trust lands or restricted lands as defined in 25 
CFR 151.2. (January 1, 1994)


(Authority: Sec. 13736, Pub. L. 103-66; 107 Stat. 633)

    (s) Radiation Exposure Compensation Act. Any payment made under 
Section 6 of the Radiation Exposure Compensation Act of 1990.


(Authority: 42 U.S.C. 2210 note)

    (t) Alaska Native Claims Settlement Act. Any receipt by an 
individual of cash (including cash dividends on stock received from a 
Native Corporation) to the extent that it does not, in the aggregate, 
exceed $2,000 per individual per annum; stock (including stock issued or 
distributed by a Native Corporation as a dividend or distribution on 
stock); a partnership interest; land or an interest in land (including 
land or an interest in land received from a Native Corporation as a 
dividend or distribution on stock); and an interest in a settlement 
trust. (November 2, 1994)


(Authority: Sec. 506, Pub. L. 103-446)

    (u) Monetary allowance under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans. Any allowance paid 
under the provisions of 38 U.S.C. chapter 18 to or for an individual who 
is a child of a Vietnam veteran.


(Authority: 38 U.S.C. 1833(c))

    (v) Victims of Crime Act. Amounts received as compensation under the 
Victims of Crime Act of 1984 unless the total amount of assistance 
received from all federally funded programs is sufficient to fully 
compensate the claimant for losses suffered as a result of the crime.


(Authority: 42 U.S.C. 10602(c))
    (w) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. The payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))
    (x) Life insurance proceeds. Lump-sum proceeds of any life insurance 
policy on a veteran.


(Authority: 38 U.S.C. 1503(a)(11))

[44 FR 45936, Aug. 6, 1979, as amended at 46 FR 9580, Jan. 29, 1981; 53 
FR 23235, June 21, 1988; 53 FR 24831, June 30, 1988; 56 FR 65847, Dec. 
19, 1991; 57 FR 59300, Dec. 15, 1992; 58 FR 25563, Apr. 27, 1993; 59 FR 
35266, July 11, 1994; 59 FR 37696, July 25, 1994; 59 FR 45976, Sept. 6, 
1994; 60 FR 2523, Jan. 10, 1995; 60 FR 18355, Apr. 11, 1995; 62 FR 5528, 
Feb. 6, 1997; 62 FR 51279, Sept. 30, 1997; 67 FR 9209, Feb. 28, 2002; 67 
FR 49587, July 31, 2002; 68 FR 60852, Oct. 24, 2003; 70 FR 15591, Mar. 
28, 2005; 71 FR 44918, Aug. 8, 2006]



Sec. 3.273  Rate computation.

    The commencement date of change in benefit payments based on rate 
computations under the provisions of this

[[Page 223]]

section will be determined under the provisions of Sec. 3.31 or Sec. 
3.660.
    (a) Initial award. For the purpose of determining initial 
entitlement, or for resuming payments on an award which was previously 
discontinued, the monthly rate of pension payable to a beneficiary shall 
be computed by reducing the beneficiary's applicable maximum pension 
rate by the beneficiary's countable income on the effective date of 
entitlement and dividing the remainder by 12. Effective June 1, 1983, 
the provisions of Sec. 3.29(b) apply to this paragraph. Recomputation 
of rates due to changes in the maximum annual pension rate or rate of 
income following the initial date of entitlement are subject to the 
provisions of paragraph (b) of this section.
    (b) Running awards--(1) Change in maximum annual pension rate. 
Whenever there is change in a beneficiary's applicable maximum annual 
pension rate, the monthly rate of pension payable shall be computed by 
reducing the new applicable maximum annual pension rate by the 
beneficiary's countable income on the effective date of the change in 
the applicable maximum annual pension rate, and dividing the remainder 
by 12. Effective June 1, 1983, the provisions of Sec. 3.29(b) apply to 
this paragraph.
    (2) Change in amount of income. Whenever there is a change in a 
beneficiary's amount of countable income the monthly rate of pension 
payable shall be computed by reducing the beneficiary's applicable 
maximum annual pension rate by the beneficiary's new amount of countable 
income on the effective date of the change in the amount of income, and 
dividing the remainder by 12. Effective June 1, 1983, the provisions of 
Sec. 3.29(b) apply to this paragraph.
    (c) Nonrecurring income. The amount of any nonrecurring countable 
income (e.g. an inheritance) received by a beneficiary shall be added to 
the beneficiary's annual rate of income for a 12-month annualization 
period commencing on the effective date on which the nonrecurring income 
is countable.


(Authority: 38 U.S.C. 501)

    (d) Recurring and irregular income. The amount of recurring and 
irregular income anticipated or received by a beneficiary shall be added 
to determine the beneficiary's annual rate of income for a 12-month 
annualization period commencing at the beginning of the 12-month 
annualization, subject to the provisions of Sec. 3.660(a)(2) of this 
chapter.

[44 FR 45936, Aug. 6, 1979, as amended at 48 FR 34472, July 29, 1983; 57 
FR 59300, Dec. 15, 1992]



Sec. 3.274  Relationship of net worth to pension entitlement.

    (a) Veteran. Pension shall be denied or discontinued when the corpus 
of the estate of the veteran, and of the veteran's spouse, are such that 
under all the circumstances, including consideration of the annual 
income of the veteran, the veteran's spouse, and the veteran's children, 
it is reasonable that some part of the corpus of such estates be 
consumed for the veteran's maintenance.


(Authority: 38 U.S.C. 1522(a))

    (b) Increased pension payable to a veteran for a child. Increased 
pension payable to a veteran on account of a child shall be denied or 
discontinued when the corpus of the estate of the child is such that 
under all the circumstances including consideration of the veteran's and 
spouse's income and the income of the veteran's child or children, it is 
reasonable that some part of the corpus of such child's estate be 
consumed for the child's maintenance.


(Authority: 38 U.S.C. 1522(b))

    (c) Surviving spouse. Pension payable to a surviving spouse shall be 
denied or discontinued when the corpus of the estate of the surviving 
spouse is such that under all the circumstances, including consideration 
of the surviving spouse's income and the income of any child for whom 
the surviving spouse is receiving pension, it is reasonable that some 
part of the corpus of the surviving spouse's estate be consumed for the 
surviving spouse's maintenance.


(Authority: 38 U.S.C. 1543(a)(1))

    (d) Increased pension payable to a surviving spouse for a child. 
Increased pension payable to a surviving spouse on

[[Page 224]]

account of a child shall be denied or discontinued when the corpus of 
the estate of the child is such that under all the circumstances, 
including consideration of the income of the surviving spouse and child 
and the income of any other child for whom the surviving spouse is 
receiving increased pension, it is reasonable that some part of the 
corpus of the child's estate be consumed for the maintenance of the 
child.


(Authority: 38 U.S.C. 1543(a)(2))

    (e) Child. Pension payable to a child shall be denied or 
discontinued when the corpus of the estate of the child is such that 
under all the circumstances, including consideration of the income of 
the child, the income of any person with whom the child is residing who 
is legally responsible for such child's support, and the corpus of 
estate of such person, it is reasonable that some part of the corpus of 
such estates be consumed for the child's maintenance.

(Authority: 38 U.S.C. 1543(b))



Sec. 3.275  Criteria for evaluating net worth.

    (a) General. The following rules are for application in determining 
the corpus of estate or net worth of a veteran, surviving spouse or 
child under Sec. 3.274.
    (b) Definition. The terms corpus of estate and net worth mean the 
market value, less mortgages or other encumbrances, of all real and 
personal property owned by the claimant, except the claimant's dwelling 
(single family unit), including a reasonable lot area, and personal 
effects suitable to and consistent with the claimant's reasonable mode 
of life.
    (c) Ownership. See Sec. 3.271(d).
    (d) Evaluation. In determining whether some part of the claimant's 
estate (or combined estates under Sec. 3.274 (a) and (e)) should be 
consumed for the claimant's maintenance, consideration will be given to 
the amount of the claimant's income together with the following: Whether 
the property can be readily converted into cash at no substantial 
sacrifice; life expectancy; number of dependents who meet the definition 
of member of the family (the definition contained in Sec. 3.250(b)(2) 
is applicable to the improved pension program); potential rate of 
depletion, including unusual medical expenses under the principles 
outlined in Sec. 3.272(g) for the claimant and the claimant's 
dependents.
    (e) Educational expenses. There shall be excluded from the corpus of 
estate or net worth of a child reasonable amounts for actual or 
prospective educational or vocational expenses. The amount so excluded 
shall not be such as to provide for education or training beyond age 23.


(Authority: 38 U.S.C. 501)

    (f) Agent Orange settlement payments. There shall be excluded from 
the corpus of the estate or net worth of a claimant any payment made 
from the Agent Orange Settlement Fund or any other fund established 
pursuant to the settlement in the In re Agent Orange product liability 
litigation, M.D.L. No. 381 (E.D.N.Y.). (January 1, 1989)


(Authority: Pub. L. 101-201, 103 Stat. 1795)

    (g) Restitution to individuals of Japanese ancestry. There shall be 
excluded from the corpus of estate or net worth of a claimant any 
payment made as restitution under Public Law 100-383 to individuals of 
Japanese ancestry who were interned, evacuated, or relocated during the 
period December 7, 1941, through June 30, 1946, pursuant to any law, 
Executive order, Presidential proclamation, directive, or other official 
action respecting these individuals. (August 10, 1988)


(Authority: Sec. 105, Pub. L. 100-383; 102 Stat. 905)

    (h) Radiation Exposure Compensation Act. There shall be excluded 
from the corpus of estate or net worth of a claimant any payment made 
under Section 6 of the Radiation Exposure Compensation Act of 1990.


(Authority: 42 U.S.C. 2210 note)

    (i) Monetary allowance under 38 U.S.C. chapter 18 for certain 
individuals who are children of Vietnam veterans. There shall be 
excluded from the corpus of estate or net worth of a claimant any 
allowance paid under the provisions of 38

[[Page 225]]

U.S.C. chapter 18 to or for an individual who is a child of a Vietnam 
veteran.


(Authority: 38 U.S.C. 1833(c))
    (j) Victims of Crime Act. There shall be excluded from the corpus of 
estate or net worth of a claimant any amounts received as compensation 
under the Victims of Crime Act of 1984 unless the total amount of 
assistance received from all federally funded programs is sufficient to 
fully compensate the claimant for losses suffered as a result of the 
crime.


(Authority: 42 U.S.C. 10602(c))

    (k) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. There shall be excluded from the corpus of estate or 
net worth of a claimant payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))

[44 FR 45936, Aug. 6, 1979, as amended at 57 FR 59300, Dec. 15, 1992; 60 
FR 2523, Jan. 10, 1995; 62 FR 51279, Sept. 30, 1997; 67 FR 49587, July 
31, 2002; 68 FR 60852, Oct. 24, 2003; 70 FR 15591, Mar. 28, 2005]



Sec. 3.276  Certain transfers or waivers disregarded.

    (a) Waiver of receipt of income. Potential income, not excludable 
under Sec. 3.272 and whose receipt has been waived by an individual, 
shall be included as countable income of that individual for Department 
of Veterans Affairs pension purposes.
    (b) Transfer of assets. For pension purposes, a gift of property 
made by an individual to a relative residing in the same household shall 
not be recognized as reducing the corpus of the grantor's estate. A sale 
of property to such a relative shall not be recognized as reducing the 
corpus of the seller's estate if the purchase price, or other 
consideration for the sale, is so low as to be tantamount to a gift. A 
gift of property to someone other than a relative residing in the 
grantor's household will not be recognized as reducing the corpus of the 
grantor's estate unless it is clear that the grantor has relinquished 
all rights of ownership, including the right of control of the property.

(Authority: 38 U.S.C. 501)



Sec. 3.277  Eligibility reporting requirements.

    (a) Evidence of entitlement. As a condition of granting or 
continuing pension, the Department of Veterans Affairs may require from 
any person who is an applicant for or a recipient of pension such 
information, proofs, and evidence as is necessary to determine the 
annual income and the value of the corpus of the estate of such person, 
and of any spouse or child for whom the person is receiving or is to 
receive increased pension (such child is hereinafter in this section 
referred to as a dependent child), and, in the case of a child applying 
for or in receipt of pension in his or her own behalf (hereinafter in 
this section referred to as a surviving child), of any person with whom 
such child is residing who is legally responsible for such child's 
support.
    (b) Obligation to report changes in factors affecting entitlement. 
Any individual who has applied for or receives pension must promptly 
notify the Secretary of any change affecting entitlement in any of the 
following:
    (1) Income;
    (2) Net worth or corpus of estate;
    (3) Marital status;
    (4) Nursing home patient status;
    (5) School enrollment status of a child 18 years of age or older; or
    (6) Any other factor that affects entitlement to benefits under the 
provisions of this Part.
    (c) Eligibility verification reports. (1) For purposes of this 
section the term eligibility verification report means a form prescribed 
by the Secretary that is used to request income, net worth, dependency 
status, and any other information necessary to determine or verify 
entitlement to pension.
    (2) The Secretary shall require an eligibility verification report 
under the following circumstances:
    (i) If the Social Security Administration has not verified the 
beneficiary's Social Security number and, if the beneficiary is married, 
his or her spouse's Social Security number;
    (ii) If there is reason to believe that the beneficiary or his or 
her spouse

[[Page 226]]

may have received income other than Social Security during the current 
or previous calendar year; or
    (iii) If the Secretary determines that an eligibility verification 
report is necessary to preserve program integrity.
    (3) An individual who applies for or receives pension as defined in 
Sec. 3.3 of this part shall, as a condition of receipt or continued 
receipt of benefits, furnish the Department of Veterans Affairs an 
eligibility verification report upon request.
    (d) If VA requests that a claimant or beneficiary submit an 
eligibility verification report but he or she fails to do so within 60 
days of the date of the VA request, the Secretary shall suspend the 
award or disallow the claim.

(Authority: 38 U.S.C. 1506)

(The Office of Management and Budget has approved the information 
collection requirements in this section under control numbers 2900-0101 
and 2900-0624)

[44 FR 45936, Aug. 6, 1979, as amended at 60 FR 51922, Oct. 4, 1995; 65 
FR 16827, Mar. 30, 2000; 66 FR 56614, Nov. 9, 2001]

        Ratings and Evaluations; Basic Entitlement Considerations



Sec. 3.300  Claims based on the effects of tobacco products.

    (a) For claims received by VA after June 9, 1998, a disability or 
death will not be considered service-connected on the basis that it 
resulted from injury or disease attributable to the veteran's use of 
tobacco products during service. For the purpose of this section, the 
term ``tobacco products'' means cigars, cigarettes, smokeless tobacco, 
pipe tobacco, and roll-your-own tobacco.
    (b) The provisions of paragraph (a) of this section do not prohibit 
service connection if:
    (1) The disability or death resulted from a disease or injury that 
is otherwise shown to have been incurred or aggravated during service. 
For purposes of this section, ``otherwise shown'' means that the 
disability or death can be service-connected on some basis other than 
the veteran's use of tobacco products during service, or that the 
disability became manifest or death occurred during service; or
    (2) The disability or death resulted from a disease or injury that 
appeared to the required degree of disability within any applicable 
presumptive period under Sec. Sec. 3.307, 3.309, 3.313, or 3.316; or
    (3) Secondary service connection is established for ischemic heart 
disease or other cardiovascular disease under Sec. 3.310(b).
    (c) For claims for secondary service connection received by VA after 
June 9, 1998, a disability that is proximately due to or the result of 
an injury or disease previously service-connected on the basis that it 
is attributable to the veteran's use of tobacco products during service 
will not be service-connected under Sec. 3.310(a).

(Authority: 38 U.S.C. 501(a), 1103, 1103 note)

[66 FR 18198, Apr. 6, 2001]



Sec. 3.301  Line of duty and misconduct.

    (a) Line of duty. Direct service connection may be granted only when 
a disability or cause of death was incurred or aggravated in line of 
duty, and not the result of the veteran's own willful misconduct or, for 
claims filed after October 31, 1990, the result of his or her abuse of 
alcohol or drugs.


(Authority: 38 U.S.C. 105)

    (b) Willful misconduct. Disability pension is not payable for any 
condition due to the veteran's own willful misconduct.


(Authority: 38 U.S.C. 1521)

    (c) Specific applications; willful misconduct. For the purpose of 
determining entitlement to service-connected and nonservice-connected 
benefits the definitions in Sec. Sec. 3.1 (m) and (n) of this part 
apply except as modified within paragraphs (c)(1) through (c)(3) of this 
section. The provisions of paragraphs (c)(2) and (c)(3) of this section 
are subject to the provisions of Sec. 3.302 of this part where 
applicable.


(Authority: 38 U.S.C. 501)

    (1) Venereal disease. The residuals of venereal disease are not to 
be considered the result of willful misconduct. Consideration of service 
connection for residuals of venereal disease as having

[[Page 227]]

been incurred in service requires that the initial infection must have 
occurred during active service. Increase in service of manifestations of 
venereal disease will usually be held due to natural progress unless the 
facts of record indicate the increase in manifestations was precipitated 
by trauma or by the conditions of the veteran's service, in which event 
service connection may be established by aggravation. Medical principles 
pertaining to the incubation period and its relation to the course of 
the disease; i.e., initial or acute manifestation, or period and course 
of secondary and late residuals manifested, will be considered when time 
of incurrence of venereal disease prior to or after entry into service 
is at issue. In the issue of service connection, whether the veteran 
complied with service regulations and directives for reporting the 
disease and undergoing treatment is immaterial after November 14, 1972, 
and the service department characterization of acquisition of the 
disease as willful misconduct or as not in line of duty will not govern.
    (2) The simple drinking of alcoholic beverage is not of itself 
willful misconduct. The deliberate drinking of a known poisonous 
substance or under conditions which would raise a presumption to that 
effect will be considered willful misconduct. If, in the drinking of a 
beverage to enjoy its intoxicating effects, intoxication results 
proximately and immediately in disability or death, the disability or 
death will be considered the result of the person's willful misconduct. 
Organic diseases and disabilities which are a secondary result of the 
chronic use of alcohol as a beverage, whether out of compulsion or 
otherwise, will not be considered of willful misconduct origin. (See 
Sec. Sec. 21.1043, 21.5041, and 21.7051 of this title regarding the 
disabling effects of chronic alcoholism for the purpose of extending 
delimiting periods under education or rehabilitation programs.)


(Authority: 38 U.S.C. 501)

    (3) Drug usage. The isolated and infrequent use of drugs by itself 
will not be considered willful misconduct; however, the progressive and 
frequent use of drugs to the point of addiction will be considered 
willful misconduct. Where drugs are used to enjoy or experience their 
effects and the effects result proximately and immediately in disability 
or death, such disability or death will be considered the result of the 
person's willful misconduct. Organic diseases and disabilities which are 
a secondary result of the chronic use of drugs and infections coinciding 
with the injection of drugs will not be considered of willful misconduct 
origin. (See paragraph (d) of this section regarding service connection 
where disability or death is a result of abuse of drugs.) Where drugs 
are used for therapeutic purposes or where use of drugs or addiction 
thereto, results from a service-connected disability, it will not be 
considered of misconduct origin.


(Authority: 38 U.S.C. 105, 1110, 1121, 1131, 1301, and 1521(a))

    (d) Line of duty; abuse of alcohol or drugs. An injury or disease 
incurred during active military, naval, or air service shall not be 
deemed to have been incurred in line of duty if such injury or disease 
was a result of the abuse of alcohol or drugs by the person on whose 
service benefits are claimed. For the purpose of this paragraph, alcohol 
abuse means the use of alcoholic beverages over time, or such excessive 
use at any one time, sufficient to cause disability to or death of the 
user; drug abuse means the use of illegal drugs (including prescription 
drugs that are illegally or illicitly obtained), the intentional use of 
prescription or non-prescription drugs for a purpose other than the 
medically intended use, or the use of substances other than alcohol to 
enjoy their intoxicating effects.

(Authority: 38 U.S.C. 105(a))

    Cross-References: In line of duty. See Sec. 3.1(m). Willful 
misconduct. See Sec. 3.1(n). Extended period of eligibility. See 
Sec. Sec. 21.1043 and 21.7051. Periods of entitlement. See Sec. 
21.5041.

[26 FR 1579, Feb. 24, 1961, as amended at 37 FR 24662, Nov. 18, 1972; 54 
FR 31951, Aug. 3, 1989; 55 FR 13530, Apr. 11, 1990; 60 FR 27408-27409, 
May 24, 1995]



Sec. 3.302  Service connection for mental unsoundness in suicide.

    (a) General. (1) In order for suicide to constitute willful 
misconduct, the act of self-destruction must be intentional.

[[Page 228]]

    (2) A person of unsound mind is incapable of forming an intent (mens 
rea, or guilty mind, which is an essential element of crime or willful 
misconduct).
    (3) It is a constant requirement for favorable action that the 
precipitating mental unsoundness be service connected.
    (b) Evidence of mental condition. (1) Whether a person, at the time 
of suicide, was so unsound mentally that he or she did not realize the 
consequence of such an act, or was unable to resist such impulse is a 
question to be determined in each individual case, based on all 
available lay and medical evidence pertaining to his or her mental 
condition at the time of suicide.
    (2) The act of suicide or a bona fide attempt is considered to be 
evidence of mental unsoundness. Therefore, where no reasonable adequate 
motive for suicide is shown by the evidence, the act will be considered 
to have resulted from mental unsoundness.
    (3) A reasonable adequate motive for suicide may be established by 
affirmative evidence showing circumstances which could lead a rational 
person to self-destruction.
    (c) Evaluation of evidence. (1) Affirmative evidence is necessary to 
justify reversal of service department findings of mental unsoundness 
where Department of Veterans Affairs criteria do not otherwise warrant 
contrary findings.
    (2) In all instances any reasonable doubt should be resolved 
favorably to support a finding of service connection (see Sec. 3.102).

    Cross Reference: Cause of death. See Sec. 3.312.

[28 FR 183, Jan. 8, 1963, as amended at 54 FR 31951, Aug. 3, 1989; 55 FR 
13530, Apr. 11, 1990]

               Ratings and Evaluations; Service Connection



Sec. 3.303  Principles relating to service connection.

    (a) General. Service connection connotes many factors but basically 
it means that the facts, shown by evidence, establish that a particular 
injury or disease resulting in disability was incurred coincident with 
service in the Armed Forces, or if preexisting such service, was 
aggravated therein. This may be accomplished by affirmatively showing 
inception or aggravation during service or through the application of 
statutory presumptions. Each disabling condition shown by a veteran's 
service records, or for which he seeks a service connection must be 
considered on the basis of the places, types and circumstances of his 
service as shown by service records, the official history of each 
organization in which he served, his medical records and all pertinent 
medical and lay evidence. Determinations as to service connection will 
be based on review of the entire evidence of record, with due 
consideration to the policy of the Department of Veterans Affairs to 
administer the law under a broad and liberal interpretation consistent 
with the facts in each individual case.
    (b) Chronicity and continuity. With chronic disease shown as such in 
service (or within the presumptive period under Sec. 3.307) so as to 
permit a finding of service connection, subsequent manifestations of the 
same chronic disease at any later date, however remote, are service 
connected, unless clearly attributable to intercurrent causes. This rule 
does not mean that any manifestation of joint pain, any abnormality of 
heart action or heart sounds, any urinary findings of casts, or any 
cough, in service will permit service connection of arthritis, disease 
of the heart, nephritis, or pulmonary disease, first shown as a clearcut 
clinical entity, at some later date. For the showing of chronic disease 
in service there is required a combination of manifestations sufficient 
to identify the disease entity, and sufficient observation to establish 
chronicity at the time, as distinguished from merely isolated findings 
or a diagnosis including the word ``Chronic.'' When the disease identity 
is established (leprosy, tuberculosis, multiple sclerosis, etc.), there 
is no requirement of evidentiary showing of continuity. Continuity of 
symptomatology is required only where the condition noted during service 
(or in the presumptive period) is not, in fact, shown to be chronic or 
where the diagnosis of chronicity may be legitimately questioned. When 
the fact of chronicity in service is not adequately supported,

[[Page 229]]

then a showing of continuity after discharge is required to support the 
claim.
    (c) Preservice disabilities noted in service. There are medical 
principles so universally recognized as to constitute fact (clear and 
unmistakable proof), and when in accordance with these principles 
existence of a disability prior to service is established, no additional 
or confirmatory evidence is necessary. Consequently with notation or 
discovery during service of such residual conditions (scars; fibrosis of 
the lungs; atrophies following disease of the central or peripheral 
nervous system; healed fractures; absent, displaced or resected parts of 
organs; supernumerary parts; congenital malformations or hemorrhoidal 
tags or tabs, etc.) with no evidence of the pertinent antecedent active 
disease or injury during service the conclusion must be that they 
preexisted service. Similarly, manifestation of lesions or symptoms of 
chronic disease from date of enlistment, or so close thereto that the 
disease could not have originated in so short a period will establish 
preservice existence thereof. Conditions of an infectious nature are to 
be considered with regard to the circumstances of the infection and if 
manifested in less than the respective incubation periods after 
reporting for duty, they will be held to have preexisted service. In the 
field of mental disorders, personality disorders which are characterized 
by developmental defects or pathological trends in the personality 
structure manifested by a lifelong pattern of action or behavior, 
chronic psychoneurosis of long duration or other psychiatric 
symptomatology shown to have existed prior to service with the same 
manifestations during service, which were the basis of the service 
diagnosis, will be accepted as showing preservice origin. Congenital or 
developmental defects, refractive error of the eye, personality 
disorders and mental deficiency as such are not diseases or injuries 
within the meaning of applicable legislation.
    (d) Postservice initial diagnosis of disease. Service connection may 
be granted for any disease diagnosed after discharge, when all the 
evidence, including that pertinent to service, establishes that the 
disease was incurred in service. Presumptive periods are not intended to 
limit service connection to diseases so diagnosed when the evidence 
warrants direct service connection. The presumptive provisions of the 
statute and Department of Veterans Affairs regulations implementing them 
are intended as liberalizations applicable when the evidence would not 
warrant service connection without their aid.

[26 FR 1579, Feb. 24, 1961]



Sec. 3.304  Direct service connection; wartime and peacetime.

    (a) General. The basic considerations relating to service connection 
are stated in Sec. 3.303. The criteria in this section apply only to 
disabilities which may have resulted from service in a period of war or 
service rendered on or after January 1, 1947.
    (b) Presumption of soundness. The veteran will be considered to have 
been in sound condition when examined, accepted and enrolled for 
service, except as to defects, infirmities, or disorders noted at 
entrance into service, or where clear and unmistakable (obvious or 
manifest) evidence demonstrates that an injury or disease existed prior 
thereto and was not aggravated by such service. Only such conditions as 
are recorded in examination reports are to be considered as noted.


(Authority: 38 U.S.C. 1111)

    (1) History of preservice existence of conditions recorded at the 
time of examination does not constitute a notation of such conditions 
but will be considered together with all other material evidence in 
determinations as to inception. Determinations should not be based on 
medical judgment alone as distinguished from accepted medical 
principles, or on history alone without regard to clinical factors 
pertinent to the basic character, origin and development of such injury 
or disease. They should be based on thorough analysis of the evidentiary 
showing and careful correlation of all material facts, with due regard 
to accepted medical principles pertaining to the history, 
manifestations, clinical course, and character of the particular injury 
or disease or residuals thereof.

[[Page 230]]

    (2) History conforming to accepted medical principles should be 
given due consideration, in conjunction with basic clinical data, and be 
accorded probative value consistent with accepted medical and 
evidentiary principles in relation to value consistent with accepted 
medical evidence relating to incurrence, symptoms and course of the 
injury or disease, including official and other records made prior to, 
during or subsequent to service, together with all other lay and medical 
evidence concerning the inception, development and manifestations of the 
particular condition will be taken into full account.
    (3) Signed statements of veterans relating to the origin, or 
incurrence of any disease or injury made in service if against his or 
her own interest is of no force and effect if other data do not 
establish the fact. Other evidence will be considered as though such 
statement were not of record.


(Authority: 10 U.S.C. 1219)

    (c) Development. The development of evidence in connection with 
claims for service connection will be accomplished when deemed necessary 
but it should not be undertaken when evidence present is sufficient for 
this determination. In initially rating disability of record at the time 
of discharge, the records of the service department, including the 
reports of examination at enlistment and the clinical records during 
service, will ordinarily suffice. Rating of combat injuries or other 
conditions which obviously had their inception in service may be 
accomplished pending receipt of copy of the examination at enlistment 
and all other service records.
    (d) Combat. Satisfactory lay or other evidence that an injury or 
disease was incurred or aggravated in combat will be accepted as 
sufficient proof of service connection if the evidence is consistent 
with the circumstances, conditions or hardships of such service even 
though there is no official record of such incurrence or aggravation.


(Authority: 38 U.S.C. 1154(b))

    (e) Prisoners of war. Where disability compensation is claimed by a 
former prisoner of war, omission of history or findings from clinical 
records made upon repatriation is not determinative of service 
connection, particularly if evidence of comrades in support of the 
incurrence of the disability during confinement is available. Special 
attention will be given to any disability first reported after 
discharge, especially if poorly defined and not obviously of 
intercurrent origin. The circumstances attendant upon the individual 
veteran's confinement and the duration thereof will be associated with 
pertinent medical principles in determining whether disability 
manifested subsequent to service is etiologically related to the 
prisoner of war experience.
    (f) Post-traumatic stress disorder. Service connection for post-
traumatic stress disorder requires medical evidence diagnosing the 
condition in accordance with Sec. 4.125(a) of this chapter; a link, 
established by medical evidence, between current symptoms and an in-
service stressor; and credible supporting evidence that the claimed in-
service stressor occurred. Although service connection may be 
established based on other in-service stressors, the following 
provisions apply for specified in-service stressors as set forth below:
    (1) If the evidence establishes that the veteran engaged in combat 
with the enemy and the claimed stressor is related to that combat, in 
the absence of clear and convincing evidence to the contrary, and 
provided that the claimed stressor is consistent with the circumstances, 
conditions, or hardships of the veteran's service, the veteran's lay 
testimony alone may establish the occurrence of the claimed in-service 
stressor.
    (2) If the evidence establishes that the veteran was a prisoner-of-
war under the provisions of Sec. 3.1(y) of this part and the claimed 
stressor is related to that prisoner-of-war experience, in the absence 
of clear and convincing evidence to the contrary, and provided that the 
claimed stressor is consistent with the circumstances, conditions, or 
hardships of the veteran's service, the veteran's lay testimony alone 
may establish the occurrence of the claimed in-service stressor.
    (3) If a post-traumatic stress disorder claim is based on in-service 
personal assault, evidence from sources other than the veteran's service 
records may

[[Page 231]]

corroborate the veteran's account of the stressor incident. Examples of 
such evidence include, but are not limited to: records from law 
enforcement authorities, rape crisis centers, mental health counseling 
centers, hospitals, or physicians; pregnancy tests or tests for sexually 
transmitted diseases; and statements from family members, roommates, 
fellow service members, or clergy. Evidence of behavior changes 
following the claimed assault is one type of relevant evidence that may 
be found in these sources. Examples of behavior changes that may 
constitute credible evidence of the stressor include, but are not 
limited to: a request for a transfer to another military duty 
assignment; deterioration in work performance; substance abuse; episodes 
of depression, panic attacks, or anxiety without an identifiable cause; 
or unexplained economic or social behavior changes. VA will not deny a 
post-traumatic stress disorder claim that is based on in-service 
personal assault without first advising the claimant that evidence from 
sources other than the veteran's service records or evidence of behavior 
changes may constitute credible supporting evidence of the stressor and 
allowing him or her the opportunity to furnish this type of evidence or 
advise VA of potential sources of such evidence. VA may submit any 
evidence that it receives to an appropriate medical or mental health 
professional for an opinion as to whether it indicates that a personal 
assault occurred.


(Authority: 38 U.S.C. 501(a), 1154)

[26 FR 1580, Feb. 24, 1961, as amended at 31 FR 4680, Mar. 19, 1966; 39 
FR 34530, Sept. 26, 1974; 58 FR 29110, May 19, 1993; 64 FR 32808, June 
18, 1999; 67 FR 10332, Mar. 7, 2002; 70 FR 23029, May 4, 2005]



Sec. 3.305  Direct service connection; peacetime service before January 1, 1947.

    (a) General. The basic considerations relating to service connection 
are stated in Sec. 3.303. The criteria in this section apply only to 
disabilities which may have resulted from service other than in a period 
of war before January 1, 1947.
    (b) Presumption of soundness. A peacetime veteran who has had 
active, continuous service of 6 months or more will be considered to 
have been in sound condition when examined, accepted and enrolled for 
service, except as to defects, infirmities or disorders noted at the 
time thereof, or where evidence or medical judgment, as distinguished 
from medical fact and principles, establishes that an injury or disease 
preexisted service. Any evidence acceptable as competent to indicate the 
time of existence or inception of the condition may be considered. 
Determinations based on medical judgment will take cognizance of the 
time of inception or manifestation of disease or injury following 
entrance into service, as shown by proper service authorities in service 
records, entries or reports. Such records will be accorded reasonable 
weight in consideration of other evidence and sound medical reasoning. 
Opinions may be solicited from Department of Veterans Affairs medical 
authorities when considered necessary.
    (c) Campaigns and expeditions. In considering claims of veterans who 
engaged in combat during campaigns or expeditions satisfactory lay or 
other evidence of incurrence or aggravation in such combat of an injury 
or disease, if consistent with the circumstances, conditions or 
hardships of such service will be accepted as sufficient proof of 
service connection, even when there is no official record of incurrence 
or aggravation. Service connection for such injury or disease may be 
rebutted by clear and convincing evidence to the contrary.

[26 FR 1580, Feb. 24, 1961, as amended at 28 FR 3088, Mar. 29, 1963; 39 
FR 34530, Sept. 26, 1974]



Sec. 3.306  Aggravation of preservice disability.

    (a) General. A preexisting injury or disease will be considered to 
have been aggravated by active military, naval, or air service, where 
there is an increase in disability during such service, unless there is 
a specific finding that the increase in disability is due to the natural 
progress of the disease.


(Authority: 38 U.S.C. 1153)


[[Page 232]]


    (b) Wartime service; peacetime service after December 31, 1946. 
Clear and unmistakable evidence (obvious or manifest) is required to 
rebut the presumption of aggravation where the preservice disability 
underwent an increase in severity during service. This includes medical 
facts and principles which may be considered to determine whether the 
increase is due to the natural progress of the condition. Aggravation 
may not be conceded where the disability underwent no increase in 
severity during service on the basis of all the evidence of record 
pertaining to the manifestations of the disability prior to, during and 
subsequent to service.
    (1) The usual effects of medical and surgical treatment in service, 
having the effect of ameliorating disease or other conditions incurred 
before enlistment, including postoperative scars, absent or poorly 
functioning parts or organs, will not be considered service connected 
unless the disease or injury is otherwise aggravated by service.
    (2) Due regard will be given the places, types, and circumstances of 
service and particular consideration will be accorded combat duty and 
other hardships of service. The development of symptomatic 
manifestations of a preexisting disease or injury during or proximately 
following action with the enemy or following a status as a prisoner of 
war will establish aggravation of a disability.


(Authority: 38 U.S.C. 1154)

    (c) Peacetime service prior to December 7, 1941. The specific 
finding requirement that an increase in disability is due to the natural 
progress of the condition will be met when the available evidence of a 
nature generally acceptable as competent shows that the increase in 
severity of a disease or injury or acceleration in progress was that 
normally to be expected by reason of the inherent character of the 
condition, aside from any extraneous or contributing cause or influence 
peculiar to military service. Consideration will be given to the 
circumstances, conditions, and hardships of service.

[26 FR 1580, Feb. 24, 1961, as amended at 57 FR 59296, Dec. 15, 1992]



Sec. 3.307  Presumptive service connection for chronic, tropical or prisoner-of-war related disease, or disease associated with exposure to certain herbicide 
          agents; wartime and service on or after January 1, 1947.

    (a) General. A chronic, tropical, prisoner of war related disease, 
or a disease associated with exposure to certain herbicide agents listed 
in Sec. 3.309 will be considered to have been incurred in or aggravated 
by service under the circumstances outlined in this section even though 
there is no evidence of such disease during the period of service. No 
condition other than one listed in Sec. 3.309(a) will be considered 
chronic.
    (1) Service. The veteran must have served 90 days or more during a 
war period or after December 31, 1946. The requirement of 90 days' 
service means active, continuous service within or extending into or 
beyond a war period, or which began before and extended beyond December 
31, 1946, or began after that date. Any period of service is sufficient 
for the purpose of establishing the presumptive service connection of a 
specified disease under the conditions listed in Sec. 3.309(c) and (e).
    (2) Separation from service. For the purpose of paragraph (a)(3) and 
(4) of this section the date of separation from wartime service will be 
the date of discharge or release during a war period, or if service 
continued after the war, the end of the war period. In claims based on 
service on or after January 1, 1947, the date of separation will be the 
date of discharge or release from the period of service on which the 
claim is based.
    (3) Chronic disease. The disease must have become manifest to a 
degree of 10 percent or more within 1 year (for Hansen's disease 
(leprosy) and tuberculosis, within 3 years; multiple sclerosis, within 7 
years) from the date of separation from service as specified in 
paragraph (a)(2) of this section.
    (4) Tropical disease. The disease must have become manifest to a 
degree of 10 percent or more within 1 year from date of separation from 
service as specified in paragraph (a)(2) of this section, or at a time 
when standard accepted treatises indicate that the incubation period 
commenced during such service.

[[Page 233]]

The resultant disorders or diseases originating because of therapy 
administered in connection with a tropical disease or as a preventative 
may also be service connected.


(Authority: 38 U.S.C. 1112)

    (5) Diseases specific as to former prisoners of war. The diseases 
listed in Sec. 3.309(c) shall have become manifest to a degree of 10 
percent or more at any time after discharge or release from active 
service.


(Authority: 38 U.S.C. 1112)

    (6) Diseases associated with exposure to certain herbicide agents. 
(i) For the purposes of this section, the term ``herbicide agent'' means 
a chemical in an herbicide used in support of the United States and 
allied military operations in the Republic of Vietnam during the period 
beginning on January 9, 1962, and ending on May 7, 1975, specifically: 
2,4-D; 2,4,5-T and its contaminant TCDD; cacodylic acid; and picloram.


(Authority: 38 U.S.C. 1116(a)(4))

    (ii) The diseases listed at Sec. 3.309(e) shall have become 
manifest to a degree of 10 percent or more at any time after service, 
except that chloracne or other acneform disease consistent with 
chloracne, porphyria cutanea tarda, and acute and subacute peripheral 
neuropathy shall have become manifest to a degree of 10 percent or more 
within a year after the last date on which the veteran was exposed to an 
herbicide agent during active military, naval, or air service.
    (iii) A veteran who, during active military, naval, or air service, 
served in the Republic of Vietnam during the period beginning on January 
9, 1962, and ending on May 7, 1975, shall be presumed to have been 
exposed during such service to an herbicide agent, unless there is 
affirmative evidence to establish that the veteran was not exposed to 
any such agent during that service. The last date on which such a 
veteran shall be presumed to have been exposed to an herbicide agent 
shall be the last date on which he or she served in the Republic of 
Vietnam during the period beginning on January 9, 1962, and ending on 
May 7, 1975. ``Service in the Republic of Vietnam'' includes service in 
the waters offshore and service in other locations if the conditions of 
service involved duty or visitation in the Republic of Vietnam.


(Authority: 38 U.S.C. 501(a) and 1116(a)(3))

    (b) Evidentiary basis. The factual basis may be established by 
medical evidence, competent lay evidence or both. Medical evidence 
should set forth the physical findings and symptomatology elicited by 
examination within the applicable period. Lay evidence should describe 
the material and relevant facts as to the veteran's disability observed 
within such period, not merely conclusions based upon opinion. The 
chronicity and continuity factors outlined in Sec. 3.303(b) will be 
considered. The diseases listed in Sec. 3.309(a) will be accepted as 
chronic, even though diagnosed as acute because of insidious inception 
and chronic development, except: (1) Where they result from intercurrent 
causes, for example, cerebral hemorrhage due to injury, or active 
nephritis or acute endocarditis due to intercurrent infection (with or 
without identification of the pathogenic micro-organism); or (2) where a 
disease is the result of drug ingestion or a complication of some other 
condition not related to service. Thus, leukemia will be accepted as a 
chronic disease whether diagnosed as acute or chronic. Unless the 
clinical picture is clear otherwise, consideration will be given as to 
whether an acute condition is an exacerbation of a chronic disease.


(Authority: 38 U.S.C. 1112)

    (c) Prohibition of certain presumptions. No presumptions may be 
invoked on the basis of advancement of the disease when first definitely 
diagnosed for the purpose of showing its existence to a degree of 10 
percent within the applicable period. This will not be interpreted as 
requiring that the disease be diagnosed in the presumptive period, but 
only that there be then shown by acceptable medical or lay evidence 
characteristic manifestations of the disease to the required degree, 
followed without unreasonable time lapse by definite diagnosis. 
Symptomatology shown in

[[Page 234]]

the prescribed period may have no particular significance when first 
observed, but in the light of subsequent developments it may gain 
considerable significance. Cases in which a chronic condition is shown 
to exist within a short time following the applicable presumptive 
period, but without evidence of manifestations within the period, should 
be developed to determine whether there was symptomatology which in 
retrospect may be identified and evaluated as manifestation of the 
chronic disease to the required 10-percent degree.
    (d) Rebuttal of service incurrence or aggravation. (1) Evidence 
which may be considered in rebuttal of service incurrence of a disease 
listed in Sec. 3.309 will be any evidence of a nature usually accepted 
as competent to indicate the time of existence or inception of disease, 
and medical judgment will be exercised in making determinations relative 
to the effect of intercurrent injury or disease. The expression 
``affirmative evidence to the contrary'' will not be taken to require a 
conclusive showing, but such showing as would, in sound medical 
reasoning and in the consideration of all evidence of record, support a 
conclusion that the disease was not incurred in service. As to tropical 
diseases the fact that the veteran had no service in a locality having a 
high incidence of the disease may be considered as evidence to rebut the 
presumption, as may residence during the period in question in a region 
where the particular disease is endemic. The known incubation periods of 
tropical diseases should be used as a factor in rebuttal of presumptive 
service connection as showing inception before or after service.
    (2) The presumption of aggravation provided in this section may be 
rebutted by affirmative evidence that the preexisting condition was not 
aggravated by service, which may include affirmative evidence that any 
increase in disability was due to an intercurrent disease or injury 
suffered after separation from service or evidence sufficient, under 
Sec. 3.306 of this part, to show that the increase in disability was 
due to the natural progress of the preexisting condition.

(Authority: 38 U.S.C 1113 and 1153)

[26 FR 1581, Feb. 24, 1961, as amended at 35 FR 18281, Dec. 1, 1970; 39 
FR 34530, Sept. 26, 1974; 43 FR 45347, Oct. 2, 1978; 47 FR 11655, Mar. 
18, 1982; 58 FR 29109, May 19, 1993; 59 FR 5106, Feb. 3, 1994; 59 FR 
29724, June 9, 1994; 61 FR 57588, Nov 7, 1996; 62 FR 35422, July 1, 
1997; 67 FR 67793, Nov. 7, 2002; 68 FR 34541, June 10, 2003]



Sec. 3.308  Presumptive service connection; peacetime service before January 1, 1947.

    (a) Chronic disease. There is no provision for presumptive service 
connection for chronic disease as distinguished from tropical diseases 
referred to in paragraph (b) of this section based on peacetime service 
before January 1, 1947.
    (b) Tropical disease. In claims based on peacetime service before 
January 1, 1947, a veteran of 6 months or more service who contracts a 
tropical disease listed in Sec. 3.309(b) or a resultant disorder or 
disease originating because of therapy administered in connection with a 
tropical disease or as a preventative, will be considered to have 
incurred such disability in service when it is shown to exist to the 
degree of 10 percent or more within 1 year after separation from active 
service, or at a time when standard and accepted treatises indicate that 
the incubation period commenced during active service unless shown by 
clear and unmistakable evidence not to have been of service origin. The 
requirement of 6 months or more service means active, continuous 
service, during one or more enlistment periods.

(Authority: 38 U.S.C. 1133)

[39 FR 34530, Sept. 26, 1974]



Sec. 3.309  Disease subject to presumptive service connection.

    (a) Chronic diseases. The following diseases shall be granted 
service connection although not otherwise established as incurred in or 
aggravated by service if manifested to a compensable degree within the 
applicable time limits under Sec. 3.307 following service in a period 
of war or following peacetime

[[Page 235]]

service on or after January 1, 1947, provided the rebuttable presumption 
provisions of Sec. 3.307 are also satisfied.

Anemia, primary.
Arteriosclerosis.
Arthritis.
Atrophy, progressive muscular.
Brain hemorrhage.
Brain thrombosis.
Bronchiectasis.
Calculi of the kidney, bladder, or gallbladder.

    Cardiovascular-renal disease, including hypertension. (This term 
applies to combination involvement of the type of arteriosclerosis, 
nephritis, and organic heart disease, and since hypertension is an early 
symptom long preceding the development of those diseases in their more 
obvious forms, a disabling hypertension within the 1-year period will be 
given the same benefit of service connection as any of the chronic 
diseases listed.)

Cirrhosis of the liver.
Coccidioidomycosis.
Diabetes mellitus.
Encephalitis lethargica residuals.
Endocarditis. (This term covers all forms of valvular heart disease.)
Endocrinopathies.
Epilepsies.
Hansen's disease.
Hodgkin's disease.
Leukemia.
Lupus erythematosus, systemic.
Myasthenia gravis.
Myelitis.
Myocarditis.
Nephritis.
Other organic diseases of the nervous system.
Osteitis deformans (Paget's disease).
Osteomalacia.
Palsy, bulbar.
Paralysis agitans.
Psychoses.
Purpura idiopathic, hemorrhagic.
Raynaud's disease.
Sarcoidosis.
Scleroderma.
Sclerosis, amyotrophic lateral.
Sclerosis, multiple.
Syringomyelia.
Thromboangiitis obliterans (Buerger's disease).
Tuberculosis, active.
Tumors, malignant, or of the brain or spinal cord or peripheral nerves.
Ulcers, peptic (gastric or duodenal) (A proper diagnosis of gastric or 
duodenal ulcer (peptic ulcer) is to be considered established if it 
represents a medically sound interpretation of sufficient clinical 
findings warranting such diagnosis and provides an adequate basis for a 
differential diagnosis from other conditions with like symptomatology; 
in short, where the preponderance of evidence indicates gastric or 
duodenal ulcer (peptic ulcer). Whenever possible, of course, laboratory 
findings should be used in corroboration of the clinical data.

    (b) Tropical diseases. The following diseases shall be granted 
service connection as a result of tropical service, although not 
otherwise established as incurred in service if manifested to a 
compensable degree within the applicable time limits under Sec. 3.307 
or Sec. 3.308 following service in a period of war or following 
peacetime service, provided the rebuttable presumption provisions of 
Sec. 3.307 are also satisfied.

Amebiasis.
Blackwater fever.
Cholera.
Dracontiasis.
Dysentery.
Filariasis.
Leishmaniasis, including kala-azar.
Loiasis.
Malaria.
Onchocerciasis.
Oroya fever.
Pinta.
Plague.
Schistosomiasis.
Yaws.
Yellow fever.
Resultant disorders or diseases originating because of therapy 
administered in connection with such diseases or as a preventative 
thereof.

    (c) Diseases specific as to former prisoners of war. (1) If a 
veteran is a former prisoner of war, the following diseases shall be 
service connected if manifest to a degree of disability of 10 percent or 
more at any time after discharge or release from active military, naval, 
or air service even though there is no record of such disease during 
service, provided the rebuttable presumption provisions of Sec. 3.307 
are also satisfied.
    Psychosis.
    Any of the anxiety states.
    Dysthymic disorder (or depressive neurosis).
    Organic residuals of frostbite, if it is determined that the veteran 
was interned in climatic conditions consistent with the occurrence of 
frostbite.
    Post-traumatic osteoarthritis.

[[Page 236]]

    Atherosclerotic heart disease or hypertensive vascular disease 
(including hypertensive heart disease) and their complications 
(including myocardial infarction, congestive heart failure, arrhythmia).
    Stroke and its complications.
    (2) If the veteran:
    (i) Is a former prisoner of war and;
    (ii) Was interned or detained for not less than 30 days, the 
following diseases shall be service connected if manifest to a degree of 
10 percent or more at any time after discharge or release from active 
military, naval, or air service even though there is no record of such 
disease during service, provided the rebuttable presumption provisions 
of Sec. 3.307 are also satisfied.
    Avitaminosis.
    Beriberi (including beriberi heart disease).
    Chronic dysentery.
    Helminthiasis.
    Malnutrition (including optic atrophy associated with malnutrition).
    Pellagra.
    Any other nutritional deficiency.
    Irritable bowel syndrome.
    Peptic ulcer disease.
    Peripheral neuropathy except where directly related to infectious 
causes.
    Cirrhosis of the liver.

(Authority: 38 U.S.C. 1112(b))

    (d) Diseases specific to radiation-exposed veterans. (1) The 
diseases listed in paragraph (d)(2) of this section shall be service-
connected if they become manifest in a radiation-exposed veteran as 
defined in paragraph (d)(3) of this section, provided the rebuttable 
presumption provisions of Sec. 3.307 of this part are also satisfied.
    (2) The diseases referred to in paragraph (d)(1) of this section are 
the following:
    (i) Leukemia (other than chronic lymphocytic leukemia).
    (ii) Cancer of the thyroid.
    (iii) Cancer of the breast.
    (iv) Cancer of the pharynx.
    (v) Cancer of the esophagus.
    (vi) Cancer of the stomach.
    (vii) Cancer of the small intestine.
    (viii) Cancer of the pancreas.
    (ix) Multiple myeloma.
    (x) Lymphomas (except Hodgkin's disease).
    (xi) Cancer of the bile ducts.
    (xii) Cancer of the gall bladder.
    (xiii) Primary liver cancer (except if cirrhosis or hepatitis B is 
indicated).
    (xiv) Cancer of the salivary gland.
    (xv) Cancer of the urinary tract.
    (xvi) Bronchiolo-alveolar carcinoma.
    (xvii) Cancer of the bone.
    (xviii) Cancer of the brain.
    (xix) Cancer of the colon.
    (xx) Cancer of the lung.
    (xxi) Cancer of the ovary.

    Note: For the purposes of this section, the term ``urinary tract'' 
means the kidneys, renal pelves, ureters, urinary bladder, and urethra.


(Authority: 38 U.S.C. 1112(c)(2))

    (3) For purposes of this section:
    (i) The term radiation-exposed veteran means either a veteran who 
while serving on active duty, or an individual who while a member of a 
reserve component of the Armed Forces during a period of active duty for 
training or inactive duty training, participated in a radiation-risk 
activity.
    (ii) The term radiation-risk activity means:
    (A) Onsite participation in a test involving the atmospheric 
detonation of a nuclear device.
    (B) The occupation of Hiroshima or Nagasaki, Japan, by United States 
forces during the period beginning on August 6, 1945, and ending on July 
1, 1946.
    (C) Internment as a prisoner of war in Japan (or service on active 
duty in Japan immediately following such internment) during World War II 
which resulted in an opportunity for exposure to ionizing radiation 
comparable to that of the United States occupation forces in Hiroshima 
or Nagasaki, Japan, during the period beginning on August 6, 1945, and 
ending on July 1, 1946.
    (D)(1) Service in which the service member was, as part of his or 
her official military duties, present during a total of at least 250 
days before February 1, 1992, on the grounds of a gaseous diffusion 
plant located in Paducah, Kentucky, Portsmouth, Ohio, or the area 
identified as K25 at Oak Ridge, Tennessee, if, during such service the 
veteran:
    (i) Was monitored for each of the 250 days of such service through 
the use of

[[Page 237]]

dosimetry badges for exposure at the plant of the external parts of 
veteran's body to radiation; or
    (ii) Served for each of the 250 days of such service in a position 
that had exposures comparable to a job that is or was monitored through 
the use of dosimetry badges; or
    (2) Service before January 1, 1974, on Amchitka Island, Alaska, if, 
during such service, the veteran was exposed to ionizing radiation in 
the performance of duty related to the Long Shot, Milrow, or Cannikin 
underground nuclear tests.
    (3) For purposes of paragraph (d)(3)(ii)(D)(1) of this section, the 
term ``day'' refers to all or any portion of a calendar day.
    (E) Service in a capacity which, if performed as an employee of the 
Department of Energy, would qualify the individual for inclusion as a 
member of the Special Exposure Cohort under section 3621(14) of the 
Energy Employees Occupational Illness Compensation Program Act of 2000 
(42 U.S.C. 7384l(14)).
    (iii) The term atmospheric detonation includes underwater nuclear 
detonations.
    (iv) The term onsite participation means:
    (A) During the official operational period of an atmospheric nuclear 
test, presence at the test site, or performance of official military 
duties in connection with ships, aircraft or other equipment used in 
direct support of the nuclear test.
    (B) During the six month period following the official operational 
period of an atmospheric nuclear test, presence at the test site or 
other test staging area to perform official military duties in 
connection with completion of projects related to the nuclear test 
including decontamination of equipment used during the nuclear test.
    (C) Service as a member of the garrison or maintenance forces on 
Eniwetok during the periods June 21, 1951, through July 1, 1952, August 
7, 1956, through August 7, 1957, or November 1, 1958, through April 30, 
1959.
    (D) Assignment to official military duties at Naval Shipyards 
involving the decontamination of ships that participated in Operation 
Crossroads.
    (v) For tests conducted by the United States, the term operational 
period means:
    (A) For Operation TRINITY the period July 16, 1945 through August 6, 
1945.
    (B) For Operation CROSSROADS the period July 1, 1946 through August 
31, 1946.
    (C) For Operation SANDSTONE the period April 15, 1948 through May 
20, 1948.
    (D) For Operation RANGER the period January 27, 1951 through 
February 6, 1951.
    (E) For Operation GREENHOUSE the period April 8, 1951 through June 
20, 1951.
    (F) For Operation BUSTER-JANGLE the period October 22, 1951 through 
December 20, 1951.
    (G) For Operation TUMBLER-SNAPPER the period April 1, 1952 through 
June 20, 1952.
    (H) For Operation IVY the period November 1, 1952 through December 
31, 1952.
    (I) For Operation UPSHOT-KNOTHOLE the period March 17, 1953 through 
June 20, 1953.
    (J) For Operation CASTLE the period March 1, 1954 through May 31, 
1954.
    (K) For Operation TEAPOT the period February 18, 1955 through June 
10, 1955.
    (L) For Operation WIGWAM the period May 14, 1955 through May 15, 
1955.
    (M) For Operation REDWING the period May 5, 1956 through August 6, 
1956.
    (N) For Operation PLUMBBOB the period May 28, 1957 through October 
22, 1957.
    (O) For Operation HARDTACK I the period April 28, 1958 through 
October 31, 1958.
    (P) For Operation ARGUS the period August 27, 1958 through September 
10, 1958.
    (Q) For Operation HARDTACK II the period September 19, 1958 through 
October 31, 1958.
    (R) For Operation DOMINIC I the period April 25, 1962 through 
December 31, 1962.
    (S) For Operation DOMINIC II/PLOWSHARE the period July 6, 1962 
through August 15, 1962.
    (vi) The term ``occupation of Hiroshima or Nagasaki, Japan, by 
United States forces'' means official military

[[Page 238]]

duties within 10 miles of the city limits of either Hiroshima or 
Nagasaki, Japan, which were required to perform or support military 
occupation functions such as occupation of territory, control of the 
population, stabilization of the government, demilitarization of the 
Japanese military, rehabilitation of the infrastructure or deactivation 
and conversion of war plants or materials.
    (vii) Former prisoners of war who had an opportunity for exposure to 
ionizing radiation comparable to that of veterans who participated in 
the occupation of Hiroshima or Nagasaki, Japan, by United States forces 
shall include those who, at any time during the period August 6, 1945, 
through July 1, 1946:
    (A) Were interned within 75 miles of the city limits of Hiroshima or 
within 150 miles of the city limits of Nagasaki, or
    (B) Can affirmatively show they worked within the areas set forth in 
paragraph (d)(3)(vii)(A) of this section although not interned within 
those areas, or
    (C) Served immediately following internment in a capacity which 
satisfies the definition in paragraph (d)(3)(vi) of this section, or
    (D) Were repatriated through the port of Nagasaki.


(Authority: 38 U.S.C. 1110, 1112, 1131)

    (e) Disease associated with exposure to certain herbicide agents. If 
a veteran was exposed to an herbicide agent during active military, 
naval, or air service, the following diseases shall be service-connected 
if the requirements of Sec. 3.307(a)(6) are met even though there is no 
record of such disease during service, provided further that the 
rebuttable presumption provisions of Sec. 3.307(d) are also satisfied.

Chloracne or other acneform disease consistent with chloracne
Type 2 diabetes (also known as Type II diabetes mellitus or adult-onset 
diabetes)
Hodgkin's disease
Chronic lymphocytic leukemia
Multiple myeloma
Non-Hodgkin's lymphoma
Acute and subacute peripheral neuropathy
Porphyria cutanea tarda
Prostate cancer
Respiratory cancers (cancer of the lung, bronchus, larynx, or trachea)
Soft-tissue sarcoma (other than osteosarcoma, chondrosarcoma, Kaposi's 
sarcoma, or mesothelioma)

    Note 1: The term ``soft-tissue sarcoma'' includes the following:
Adult fibrosarcoma
Dermatofibrosarcoma protuberans
Malignant fibrous histiocytoma
Liposarcoma
Leiomyosarcoma
Epithelioid leiomyosarcoma (malignant leiomyoblastoma)
Rhabdomyosarcoma
Ectomesenchymoma
Angiosarcoma (hemangiosarcoma and lymphangiosarcoma)
Proliferating (systemic) angioendotheliomatosis
Malignant glomus tumor
Malignant hemangiopericytoma
Synovial sarcoma (malignant synovioma)
Malignant giant cell tumor of tendon sheath
Malignant schwannoma, including malignant schwannoma with 
rhabdomyoblastic differentiation (malignant Triton tumor), glandular and 
epithelioid malignant schwannomas
Malignant mesenchymoma
Malignant granular cell tumor
Alveolar soft part sarcoma
Epithelioid sarcoma
Clear cell sarcoma of tendons and aponeuroses
Extraskeletal Ewing's sarcoma
Congenital and infantile fibrosarcoma
Malignant ganglioneuroma
    Note 2: For purposes of this section, the term acute and subacute 
peripheral neuropathy means transient peripheral neuropathy that appears 
within weeks or months of exposure to an herbicide agent and resolves 
within two years of the date of onset.

(Authority: 38 U.S.C. 501(a) and 1116)

[41 FR 55873, Dec. 23, 1976 and 47 FR 11656, Mar. 18, 1982, as amended 
at 47 FR 54436, Dec. 3, 1982; 49 FR 47003, Nov. 30, 1984; 53 FR 23236, 
June 21, 1988; 54 FR 26029, June 21, 1989; 57 FR 10426, Mar. 26, 1992; 
58 FR 25564, Apr. 27, 1993; 58 FR 29109, May 19, 1993; 58 FR 41636, Aug. 
5, 1993; 59 FR 5107, Feb. 3, 1994; 59 FR 25329, May 16, 1994; 59 FR 
29724, June 9, 1994; 59 FR 35465, July 12, 1994; 60 FR 31252, June 14, 
1995; 61 FR 57589, Nov. 7, 1996; 65 FR 43700, July 14, 2000; 66 FR 
23168, May 8, 2001; 67 FR 3615, Jan. 25, 2002; 67 FR 67793, Nov. 7, 
2002; 68 FR 42603, July 18, 2003; 68 FR 59542, Oct. 16, 2003; 69 FR 
60089, Oct. 7, 2004; 71 FR 44918, Aug. 8, 2006; 73 FR 30485, May 28, 
2008; 73 FR 31753, June 4, 2008]

[[Page 239]]



Sec. 3.310  Disabilities that are proximately due to, or aggravated by, service-connected disease or injury.

    (a) General. Except as provided in Sec. 3.300(c), disability which 
is proximately due to or the result of a service-connected disease or 
injury shall be service connected. When service connection is thus 
established for a secondary condition, the secondary condition shall be 
considered a part of the original condition.
    (b) Aggravation of nonservice-connected disabilities. Any increase 
in severity of a nonservice-connected disease or injury that is 
proximately due to or the result of a service-connected disease or 
injury, and not due to the natural progress of the nonservice-connected 
disease, will be service connected. However, VA will not concede that a 
nonservice-connected disease or injury was aggravated by a service-
connected disease or injury unless the baseline level of severity of the 
nonservice-connected disease or injury is established by medical 
evidence created before the onset of aggravation or by the earliest 
medical evidence created at any time between the onset of aggravation 
and the receipt of medical evidence establishing the current level of 
severity of the nonservice-connected disease or injury. The rating 
activity will determine the baseline and current levels of severity 
under the Schedule for Rating Disabilities (38 CFR part 4) and determine 
the extent of aggravation by deducting the baseline level of severity, 
as well as any increase in severity due to the natural progress of the 
disease, from the current level.


(Authority: 38 U.S.C. 1110 and 1131)

    (c) Cardiovascular disease. Ischemic heart disease or other 
cardiovascular disease developing in a veteran who has a service-
connected amputation of one lower extremity at or above the knee or 
service-connected amputations of both lower extremities at or above the 
ankles, shall be held to be the proximate result of the service-
connected amputation or amputations.

(Authority: 38 U.S.C. 501, 1110-1131)

[44 FR 50340, Aug. 28, 1979, as amended at 66 FR 18198, Apr. 6, 2001; 71 
FR 52747, Sept. 7, 2006]



Sec. 3.311  Claims based on exposure to ionizing radiation.

    (a) Determinations of exposure and dose--(1) Dose assessment. In all 
claims in which it is established that a radiogenic disease first became 
manifest after service and was not manifest to a compensable degree 
within any applicable presumptive period as specified in Sec. 3.307 or 
Sec. 3.309, and it is contended the disease is a result of exposure to 
ionizing radiation in service, an assessment will be made as to the size 
and nature of the radiation dose or doses. When dose estimates provided 
pursuant to paragraph (a)(2) of this section are reported as a range of 
doses to which a veteran may have been exposed, exposure at the highest 
level of the dose range reported will be presumed.


(Authority: 38 U.S.C. 501)

    (2) Request for dose information. Where necessary pursuant to 
paragraph (a)(1) of this section, dose information will be requested as 
follows:
    (i) Atmospheric nuclear weapons test participation claims. In claims 
based upon participation in atmospheric nuclear testing, dose data will 
in all cases be requested from the appropriate office of the Department 
of Defense.
    (ii) Hiroshima and Nagasaki occupation claims. In all claims based 
on participation in the American occupation of Hiroshima or Nagasaki, 
Japan, prior to July 1, 1946, dose data will be requested from the 
Department of Defense.
    (iii) Other exposure claims. In all other claims involving radiation 
exposure, a request will be made for any available records concerning 
the veteran's exposure to radiation. These records normally include but 
may not be limited to the veteran's Record of Occupational Exposure to 
Ionizing Radiation (DD Form 1141), if maintained, service medical 
records, and other records which may contain information pertaining to 
the veteran's radiation dose in service. All such records will be 
forwarded to the Under Secretary for Health, who will be responsible for 
preparation of a dose estimate, to the extent feasible, based on 
available methodologies.
    (3) Referral to independent expert. When necessary to reconcile a 
material

[[Page 240]]

difference between an estimate of dose, from a credible source, 
submitted by or on behalf of a claimant, and dose data derived from 
official military records, the estimates and supporting documentation 
shall be referred to an independent expert, selected by the Director of 
the National Institutes of Health, who shall prepare a separate 
radiation dose estimate for consideration in adjudication of the claim. 
For purposes of this paragraph:
    (i) The difference between the claimant's estimate and dose data 
derived from official military records shall ordinarily be considered 
material if one estimate is at least double the other estimate.
    (ii) A dose estimate shall be considered from a ``credible source'' 
if prepared by a person or persons certified by an appropriate 
professional body in the field of health physics, nuclear medicine or 
radiology and if based on analysis of the facts and circumstances of the 
particular claim.
    (4) Exposure. In cases described in paragraph (a)(2)(i) and (ii) of 
this section:
    (i) If military records do not establish presence at or absence from 
a site at which exposure to radiation is claimed to have occurred, the 
veteran's presence at the site will be conceded.
    (ii) Neither the veteran nor the veteran's survivors may be required 
to produce evidence substantiating exposure if the information in the 
veteran's service records or other records maintained by the Department 
of Defense is consistent with the claim that the veteran was present 
where and when the claimed exposure occurred.
    (b) Initial review of claims. (1) When it is determined:
    (i) A veteran was exposed to ionizing radiation as a result of 
participation in the atmospheric testing of nuclear weapons, the 
occupation of Hiroshima or Nagasaki, Japan, from September 1945 until 
July 1946, or other activities as claimed;
    (ii) The veteran subsequently developed a radiogenic disease; and
    (iii) Such disease first became manifest within the period specified 
in paragraph (b)(5) of this section; before its adjudication the claim 
will be referred to the Under Secretary for Benefits for further 
consideration in accordance with paragraph (c) of this section. If any 
of the foregoing 3 requirements has not been met, it shall not be 
determined that a disease has resulted from exposure to ionizing 
radiation under such circumstances.
    (2) For purposes of this section the term ``radiogenic disease'' 
means a disease that may be induced by ionizing radiation and shall 
include the following:
    (i) All forms of leukemia except chronic lymphatic (lymphocytic) 
leukemia;
    (ii) Thyroid cancer;
    (iii) Breast cancer;
    (iv) Lung cancer;
    (v) Bone cancer;
    (vi) Liver cancer;
    (vii) Skin cancer;
    (viii) Esophageal cancer;
    (ix) Stomach cancer;
    (x) Colon cancer;
    (xi) Pancreatic cancer;
    (xii) Kidney cancer;
    (xiii) Urinary bladder cancer;
    (xiv) Salivary gland cancer;
    (xv) Multiple myeloma;
    (xvi) Posterior subcapsular cataracts;
    (xvii) Non-malignant thyroid nodular disease;
    (xviii) Ovarian cancer;
    (xix) Parathyroid adenoma;
    (xx) Tumors of the brain and central nervous system;
    (xxi) Cancer of the rectum;
    (xxii) Lymphomas other than Hodgkin's disease;
    (xxiii) Prostate cancer; and
    (xxiv) Any other cancer.


(Authority: 38 U.S.C. 501)

    (3) Public Law 98-542 requires VA to determine whether sound medical 
and scientific evidence supports establishing a rule identifying 
polycythemia vera as a radiogenic disease. VA has determined that sound 
medical and scientific evidence does not support including polycythemia 
vera on the list of known radiogenic diseases in this regulation. Even 
so, VA will consider a claim based on the assertion that polycythemia 
vera is a radiogenic disease under the provisions of paragraph (b)(4) of 
this section. (Authority: Pub. L. 98-542, section 5(b)(2)(A)(i), (iii)).

[[Page 241]]

    (4) If a claim is based on a disease other than one of those listed 
in paragraph (b)(2) of this section, VA shall nevertheless consider the 
claim under the provisions of this section provided that the claimant 
has cited or submitted competent scientific or medical evidence that the 
claimed condition is a radiogenic disease.
    (5) For the purposes of paragraph (b)(1) of this section:
    (i) Bone cancer must become manifest within 30 years after exposure;
    (ii) Leukemia may become manifest at any time after exposure;
    (iii) Posterior subcapsular cataracts must become manifest 6 months 
or more after exposure; and
    (iv) Other diseases specified in paragraph (b)(2) of this section 
must become manifest 5 years or more after exposure.


(Authority: 38 U.S.C. 501; Pub. L. 98-542)

    (c) Review by Under Secretary for Benefits. (1) When a claim is 
forwarded for review pursuant to paragraph (b)(1) of this section, the 
Under Secretary for Benefits shall consider the claim with reference to 
the factors specified in paragraph (e) of this section and may request 
an advisory medical opinion from the Under Secretary for Health.
    (i) If after such consideration the Under Secretary for Benefits is 
convinced sound scientific and medical evidence supports the conclusion 
it is at least as likely as not the veteran's disease resulted from 
exposure to radiation in service, the Under Secretary for Benefits shall 
so inform the regional office of jurisdiction in writing. The Under 
Secretary for Benefits shall set forth the rationale for this 
conclusion, including an evaluation of the claim under the applicable 
factors specified in paragraph (e) of this section.
    (ii) If the Under Secretary for Benefits determines there is no 
reasonable possibility that the veteran's disease resulted from 
radiation exposure in service, the Under Secretary for Benefits shall so 
inform the regional office of jurisidiction in writing, setting forth 
the rationale for this conclusion.
    (2) If the Under Secretary for Benefits, after considering any 
opinion of the Under Secretary for Health, is unable to conclude whether 
it is at least as likely as not, or that there is no reasonable 
possibility, the veteran's disease resulted from radiation exposure in 
service, the Under Secretary for Benefits shall refer the matter to an 
outside consultant in accordance with paragraph (d) of this section.
    (3) For purposes of paragraph (c)(1) of this section, ``sound 
scientific evidence'' means observations, findings, or conclusions which 
are statistically and epidemiologically valid, are statistically 
significant, are capable of replication, and withstand peer review, and 
``sound medical evidence'' means observations, findings, or conclusions 
which are consistent with current medical knowledge and are so 
reasonable and logical as to serve as the basis of management of a 
medical condition.
    (d) Referral to outside consultants. (1) Referrals pursuant to 
paragraph (c) of this section shall be to consultants selected by the 
Under Secretary for Health from outside VA, upon the recommendation of 
the Director of the National Cancer Institute. The consultant will be 
asked to evaluate the claim and provide an opinion as to the likelihood 
the disease is a result of exposure as claimed.
    (2) The request for opinion shall be in writing and shall include a 
description of:
    (i) The disease, including the specific cell type and stage, if 
known, and when the disease first became manifest;
    (ii) The circumstances, including date, of the veteran's exposure;
    (iii) The veteran's age, gender, and pertinent family history;
    (iv) The veteran's history of exposure to known carcinogens, 
occupationally or otherwise;
    (v) Evidence of any other effects radiation exposure may have had on 
the veteran; and
    (vi) Any other information relevant to determination of causation of 
the veteran's disease.

The Under Secretary for Benefits shall forward, with the request, copies 
of pertinent medical records and, where available, dose assessments from 
official sources, from credible sources as defined in paragraph 
(a)(3)(ii) of this

[[Page 242]]

section, and from an independent expert pursuant to paragraph (a)(3) of 
this section.
    (3) The consultant shall evaluate the claim under the factors 
specified in paragraph (e) of this section and respond in writing, 
stating whether it is either likely, unlikely, or approximately as 
likely as not the veteran's disease resulted from exposure to ionizing 
radiation in service. The response shall set forth the rationale for the 
consultant's conclusion, including the consultant's evaluation under the 
applicable factors specified in paragraph (e) of this section. The Under 
Secretary for Benefits shall review the consultant's response and 
transmit it with any comments to the regional office of jurisdiction for 
use in adjudication of the claim.
    (e) Factors for consideration. Factors to be considered in 
determining whether a veteran's disease resulted from exposure to 
ionizing radiation in service include:
    (1) The probable dose, in terms of dose type, rate and duration as a 
factor in inducing the disease, taking into account any known 
limitations in the dosimetry devices employed in its measurement or the 
methodologies employed in its estimation;
    (2) The relative sensitivity of the involved tissue to induction, by 
ionizing radiation, of the specific pathology;
    (3) The veteran's gender and pertinent family history;
    (4) The veteran's age at time of exposure;
    (5) The time-lapse between exposure and onset of the disease; and
    (6) The extent to which exposure to radiation, or other carcinogens, 
outside of service may have contributed to development of the disease.
    (f) Adjudication of claim. The determination of service connection 
will be made under the generally applicable provisions of this part, 
giving due consideration to all evidence of record, including any 
opinion provided by the Under Secretary for Health or an outside 
consultant, and to the evaluations published pursuant to Sec. 1.17 of 
this title. With regard to any issue material to consideration of a 
claim, the provisions of Sec. 3.102 of this title apply.
    (g) Willful misconduct and supervening cause. In no case will 
service connection be established if the disease is due to the veteran's 
own willful misconduct, or if there is affirmative evidence to establish 
that a supervening, nonservice-related condition or event is more likely 
the cause of the disease.

(Authority: Pub. L. 98-542)

[50 FR 34459, Aug. 26, 1985, as amended at 54 FR 42803, Oct. 18, 1989; 
58 FR 16359, Mar. 26, 1993. Redesignated at 59 FR 5107, Feb. 3, 1994, 
and amended at 59 FR 45975, Sept. 6, 1994; 60 FR 9628, Feb. 21, 1995; 60 
FR 53277, Oct. 13, 1995; 63 FR 50994, Sept. 24, 1998; 67 FR 6871, Feb. 
14, 2002]



Sec. 3.312  Cause of death.

    (a) General. The death of a veteran will be considered as having 
been due to a service-connected disability when the evidence establishes 
that such disability was either the principal or a contributory cause of 
death. The issue involved will be determined by exercise of sound 
judgment, without recourse to speculation, after a careful analysis has 
been made of all the facts and circumstances surrounding the death of 
the veteran, including, particularly, autopsy reports.
    (b) Principal cause of death. The service-connected disability will 
be considered as the principal (primary) cause of death when such 
disability, singly or jointly with some other condition, was the 
immediate or underlying cause of death or was etiologically related 
thereto.
    (c) Contributory cause of death. (1) Contributory cause of death is 
inherently one not related to the principal cause. In determining 
whether the service-connected disability contributed to death, it must 
be shown that it contributed substantially or materially; that it 
combined to cause death; that it aided or lent assistance to the 
production of death. It is not sufficient to show that it casually 
shared in producing death, but rather it must be shown that there was a 
causal connection.
    (2) Generally, minor service-connected disabilities, particularly 
those of a static nature or not materially affecting a vital organ, 
would not be held to have contributed to death primarily due to 
unrelated disability. In the same

[[Page 243]]

category there would be included service-connected disease or injuries 
of any evaluation (even though evaluated as 100 percent disabling) but 
of a quiescent or static nature involving muscular or skeletal functions 
and not materially affecting other vital body functions.
    (3) Service-connected diseases or injuries involving active 
processes affecting vital organs should receive careful consideration as 
a contributory cause of death, the primary cause being unrelated, from 
the viewpoint of whether there were resulting debilitating effects and 
general impairment of health to an extent that would render the person 
materially less capable of resisting the effects of other disease or 
injury primarily causing death. Where the service-connected condition 
affects vital organs as distinguished from muscular or skeletal 
functions and is evaluated as 100 percent disabling, debilitation may be 
assumed.
    (4) There are primary causes of death which by their very nature are 
so overwhelming that eventual death can be anticipated irrespective of 
coexisting conditions, but, even in such cases, there is for 
consideration whether there may be a reasonable basis for holding that a 
service-connected condition was of such severity as to have a material 
influence in accelerating death. In this situation, however, it would 
not generally be reasonable to hold that a service-connected condition 
accelerated death unless such condition affected a vital organ and was 
of itself of a progressive or debilitating nature.

    Cross References: Reasonable doubt. See Sec. 3.102. Service 
connection for mental unsoundness in suicide. See Sec. 3.302.

[26 FR 1582, Feb. 24, 1961, as amended at 54 FR 34981, Aug. 23, 1989; 54 
FR 42803, Oct. 18, 1989]



Sec. 3.313  Claims based on service in Vietnam.

    (a) Service in Vietnam. Service in Vietnam includes service in the 
waters offshore, or service in other locations if the conditions of 
service involved duty or visitation in Vietnam.
    (b) Service connection based on service in Vietnam. Service in 
Vietnam during the Vietnam Era together with the development of non-
Hodgkin's lymphoma manifested subsequent to such service is sufficient 
to establish service connection for that disease.

(Authority: 38 U.S.C. 501)

[55 FR 43124, Oct. 26, 1990]



Sec. 3.314  Basic pension determinations.

    (a) Prior to the Mexican border period. While pensions are granted 
based on certain service prior to the Mexican border period, the only 
rating factors in claims therefor are:
    (1) Claims based on service of less than 90 days in the Spanish-
American War require a rating determination as to whether the veteran 
was discharged or released from service for a service-connected 
disability or had at the time of separation from service a service-
connected disability, shown by official service records, which in 
medical judgment would have warranted a discharge for disability. 
Eligibility in such cases requires a finding that the disability was 
incurred in or aggravated by service in line of duty without benefit of 
presumptive provisions of law or Department of Veterans Affairs 
regulations.


(Authority: 38 U.S.C. 1512)

    (2) Veterans entitled to pension on the basis of service in the 
Spanish-American War may be entitled to an increased rate of pension if 
rated as being in need of regular aid and attendance. Veterans who have 
elected pension under Pub. L. 86-211 (73 Stat. 432) who are not rated as 
being in need of regular aid and attendance may be entitled to increased 
pension based on 100 percent permanent disability together with 
independent disability of 60 percent or more or by reason of being 
permanently housebound as provided in Sec. 3.351 (d).


(Authority: 38 U.S.C. 1502 (b), (c), 512)

    (b) Mexican border period and later war periods. Non-service-
connected disability and death pension may be paid based on service in 
the Mexican border period, World War I, World War II, the Korean 
conflict and the Vietnam era. Rating determinations in such claims

[[Page 244]]

will be required in the following situations:
    (1) Claims based on service of less than 90 days may require a 
determination as to whether the veteran was discharged or released from 
service for a service-connected disability or had at the time of 
separation from service a service-connected disability, shown by 
official service records, which in medical judgment would have warranted 
a discharge for disability. Eligibility in such cases requires a finding 
that the disability was incurred in or aggravated by service in line of 
duty without benefit of presumptive provisions of law or Department of 
Veterans Affairs regulations (38 U.S.C. 1521(g)(2)) unless, in the case 
of death pension, the veteran was, at the time of death, receiving (or 
entitled to receive) compensation or retirement pay based upon a wartime 
service-connected disability.


(Authority: 38 U.S.C. 1541(a) and 1542(a))

    (2) Determinations of permanent total disability for pension 
purposes will be based on non-service-connected disability or combined 
non-service-connected and service-connected disabilities not the result 
of willful misconduct. However, for pension under Pub. L. 86-211 (73 
Stat. 432), permanent and total disability will be presumed where the 
veteran has attained age 65 or effective January 1, 1977, where the 
veteran became unemployable after age 65.


(Authority: 38 U.S.C. 1502(a), 1523(a))

    (3) Veterans entitled to nonservice-connected disability pension may 
be entitled to an increased rate of pension if rated as being in need of 
regular aid and attendance. Veterans entitled to protected pension or 
pension under Pub. L. 86-211 (73 Stat. 432) who are not rated as being 
in need of regular aid and attendance may be entitled to increased 
pension based on a 100 percent permanent disability together with 
independent disability of 60 percent or more or by reason of being 
permanently housebound as provided in Sec. 3.351 (d) or (e).

(Authority: 38 U.S.C. 1502 (b), (c), 1521)

[31 FR 4680, Mar. 19, 1966, as amended at 32 FR 13224, Sept. 19, 1967; 
36 FR 8446, May 6, 1971; 40 FR 56434, Dec. 3, 1975; 41 FR 56804, Dec. 
30, 1976; 61 FR 20438, May 7, 1996]



Sec. 3.315  Basic eligibility determinations; dependents, loans, education.

    (a) Child over 18 years. A child of a veteran may be considered a 
``child'' after age 18 for purposes of benefits under title 38, United 
States Code (except ch. 19 and sec. 8502(b) of ch. 85), if found by a 
rating determination to have become, prior to age 18, permanently 
incapable of self-support.


(Authority: 38 U.S.C. 101(4)(B))

    (b) Loans. If a veteran of World War II the Korean conflict or the 
Vietnam era had less than 90 days of service, or if a veteran who served 
after July 25, 1947, and prior to June 27, 1950, or after January 31, 
1955, and prior to August 5, 1964, or after May 7, 1975, has less than 
181 days of service on active duty as defined in Sec. Sec. 36.4301 and 
36.4501, eligibility of the veteran for a loan under 38 U.S.C. ch. 37 
requires a determination that the veteran was discharged or released 
because of a service-connected disability or that the official service 
department records show that he or she had at the time of separation 
from service a service-connected disability which in medical judgment 
would have warranted a discharge for disability. These determinations 
are subject to the presumption of incurrence under Sec. 3.304(b). 
Determinations based on World War II, Korean conflict and Vietnam era 
service are also subject to the presumption of aggravation under Sec. 
3.306(b) while determination based on service on or after February 1, 
1955, and before August 5, 1964, or after May 7, 1975, are subject to 
the presumption of aggravation under Sec. 3.306 (a) and (c). The 
provisions of this paragraph are also applicable, regardless of length 
of service, in determining eligibility to the maximum period of 
entitlement based on discharge or release for a service-connected 
disability. (See also

[[Page 245]]

the minimum service requirements of Sec. 3.12a.)


(Authority: 38 U.S.C. 3702, 3707)

    (c) Veterans' educational assistance. (1) A determination is 
required as to whether a veteran was discharged or released from active 
duty service because of a service-connected disability (or whether the 
official service department records show that the veteran had at time of 
separation from service a service-connected disability which in medical 
judgment would have warranted discharge for disability) whenever any of 
the following circumstances exist:
    (i) The veteran applies for benefits under 38 U.S.C. chapter 32, the 
minimum active duty service requirements of 38 U.S.C. 5303A apply to him 
or her, and the veteran would be eligible for such benefits only if--
    (A) He or she was discharged or released from active duty for a 
disability incurred or aggravated in line of duty, or
    (B) He or she has a disability that VA has determined to be 
compensable under 38 U.S.C. chapter 11; or
    (ii) The veteran applies for benefits under 38 U.S.C. chapter 30 
and--
    (A) The evidence of record does not clearly show either that the 
veteran was discharged or released from active duty for disability or 
that the veteran's discharge or release from active duty was unrelated 
to disability, and
    (B) The veteran is eligible for basic educational assistance except 
for the minimum length of active duty service requirements of Sec. 
21.7042(a) or Sec. 21.7044(a) of this chapter.
    (2) A determination is required as to whether a veteran was 
discharged or released from service in the Selected Reserve for a 
service-connected disability or for a medical condition which preexisted 
the veteran's having become a member of the Selected Reserve and which 
VA determines is not service connected when the veteran applies for 
benefits under 38 U.S.C. chapter 30 and--
    (i) Either the veteran would be eligible for basic educational 
assistance under that chapter only if he or she was discharged from the 
Selected Reserve for a service-connected disability, or for a medical 
condition which preexisted the veteran's having become a member of the 
Selected Reserve and which VA finds is not service connected, or
    (ii) The veteran is entitled to basic educational assistance and 
would be entitled to receive it at the rates stated in Sec. 21.7136(a) 
or Sec. 21.7137(a) of this chapter only if he or she was discharged 
from the Selected Reserve for a service-connected disability or for a 
medical condition which preexisted the veteran's having become a member 
of the Selected Reserve and which VA finds is not service connected.
    (3) A determination is required as to whether a reservist has been 
unable to pursue a program of education due to a disability which has 
been incurred in or aggravated by service in the Selected Reserve when--
    (i) The reservist is otherwise entitled to educational assistance 
under 10 U.S.C. chapter 1606, and
    (ii) He or she applies for an extension of his or her eligibility 
period.
    (4) The determinations required by paragraphs (c)(1) through (c)(3) 
of this section are subject to the presumptions of incurrence under 
Sec. 3.304(b) and aggravation under Sec. 3.306 (a) and (c) of this 
part, based on service rendered after May 7, 1975.

(Authority: 38 U.S.C. 3011(a)(1)(A)(ii), 3012(b)(1), 3202(1)(A), 10 
U.S.C. 16133(b))

[38 FR 871, Jan. 5, 1973, as amended at 42 FR 22869, May 5, 1977; 50 FR 
53315, Dec. 31, 1985; 51 FR 1510, Jan. 14, 1986; 55 FR 25974, June 26, 
1990; 61 FR 67950, Dec. 26, 1996]



Sec. 3.316  Claims based on chronic effects of exposure to mustard gas and Lewisite.

    (a) Except as provided in paragraph (b) of this section, exposure to 
the specified vesicant agents during active military service under the 
circumstances described below together with the subsequent development 
of any of the indicated conditions is sufficient to establish service 
connection for that condition:
    (1) Full-body exposure to nitrogen or sulfur mustard during active 
military service together with the subsequent development of chronic 
conjunctivitis,

[[Page 246]]

keratitis, corneal opacities, scar formation, or the following cancers: 
Nasopharyngeal; laryngeal; lung (except mesothelioma); or squamous cell 
carcinoma of the skin.
    (2) Full-body exposure to nitrogen or sulfur mustard or Lewisite 
during active military service together with the subsequent development 
of a chronic form of laryngitis, bronchitis, emphysema, asthma or 
chronic obstructive pulmonary disease.
    (3) Full-body exposure to nitrogen mustard during active military 
service together with the subsequent development of acute nonlymphocytic 
leukemia.
    (b) Service connection will not be established under this section if 
the claimed condition is due to the veteran's own willful misconduct 
(See Sec. 3.301(c)) or there is affirmative evidence that establishes a 
nonservice-related supervening condition or event as the cause of the 
claimed condition (See Sec. 3.303).

[59 FR 42499, Aug. 18, 1994]



Sec. 3.317  Compensation for certain disabilities due to undiagnosed illnesses.

    (a)(1) Except as provided in paragraph (c) of this section, VA will 
pay compensation in accordance with chapter 11 of title 38, United 
States Code, to a Persian Gulf veteran who exhibits objective 
indications of a qualifying chronic disability, provided that such 
disability:
    (i) Became manifest either during active military, naval, or air 
service in the Southwest Asia theater of operations during the Persian 
Gulf War, or to a degree of 10 percent or more not later than December 
31, 2011; and
    (ii) By history, physical examination, and laboratory tests cannot 
be attributed to any known clinical diagnosis.
    (2)(i) For purposes of this section, a qualifying chronic disability 
means a chronic disability resulting from any of the following (or any 
combination of the following):
    (A) An undiagnosed illness;
    (B) The following medically unexplained chronic multisymptom 
illnesses that are defined by a cluster of signs or symptoms:
    (1) Chronic fatigue syndrome;
    (2) Fibromyalgia;
    (3) Irritable bowel syndrome; or
    (4) Any other illness that the Secretary determines meets the 
criteria in paragraph (a)(2)(ii) of this section for a medically 
unexplained chronic multisymptom illness; or
    (C) Any diagnosed illness that the Secretary determines in 
regulations prescribed under 38 U.S.C. 1117(d) warrants a presumption of 
service-connection.
    (ii) For purposes of this section, the term medically unexplained 
chronic multisymptom illness means a diagnosed illness without 
conclusive pathophysiology or etiology, that is characterized by 
overlapping symptoms and signs and has features such as fatigue, pain, 
disability out of proportion to physical findings, and inconsistent 
demonstration of laboratory abnormalities. Chronic multisymptom 
illnesses of partially understood etiology and pathophysiology will not 
be considered medically unexplained.
    (3) For purposes of this section, ``objective indications of chronic 
disability'' include both ``signs,'' in the medical sense of objective 
evidence perceptible to an examining physician, and other, non-medical 
indicators that are capable of independent verification.
    (4) For purposes of this section, disabilities that have existed for 
6 months or more and disabilities that exhibit intermittent episodes of 
improvement and worsening over a 6-month period will be considered 
chronic. The 6-month period of chronicity will be measured from the 
earliest date on which the pertinent evidence establishes that the signs 
or symptoms of the disability first became manifest.
    (5) A chronic disability resulting from an undiagnosed illness 
referred to in this section shall be rated using evaluation criteria 
from part 4 of this chapter for a disease or injury in which the 
functions affected, anatomical localization, or symptomatology are 
similar.
    (6) A disability referred to in this section shall be considered 
service connected for purposes of all laws of the United States.
    (b) For the purposes of paragraph (a)(1) of this section, signs or 
symptoms which may be manifestations of

[[Page 247]]

undiagnosed illness or medically unexplained chronic multisymptom 
illness include, but are not limited to:
    (1) Fatigue
    (2) Signs or symptoms involving skin
    (3) Headache
    (4) Muscle pain
    (5) Joint pain
    (6) Neurologic signs or symptoms
    (7) Neuropsychological signs or symptoms
    (8) Signs or symptoms involving the respiratory system (upper or 
lower)
    (9) Sleep disturbances
    (10) Gastrointestinal signs or symptoms
    (11) Cardiovascular signs or symptoms
    (12) Abnormal weight loss
    (13) Menstrual disorders.
    (c) Compensation shall not be paid under this section:
    (1) If there is affirmative evidence that an undiagnosed illness was 
not incurred during active military, naval, or air service in the 
Southwest Asia theater of operations during the Persian Gulf War; or
    (2) If there is affirmative evidence that an undiagnosed illness was 
caused by a supervening condition or event that occurred between the 
veteran's most recent departure from active duty in the Southwest Asia 
theater of operations during the Persian Gulf War and the onset of the 
illness; or
    (3) If there is affirmative evidence that the illness is the result 
of the veteran's own willful misconduct or the abuse of alcohol or 
drugs.
    (d) For purposes of this section:
    (1) The term Persian Gulf veteran means a veteran who served on 
active military, naval, or air service in the Southwest Asia theater of 
operations during the Persian Gulf War.
    (2) The Southwest Asia theater of operations includes Iraq, Kuwait, 
Saudi Arabia, the neutral zone between Iraq and Saudi Arabia, Bahrain, 
Qatar, the United Arab Emirates, Oman, the Gulf of Aden, the Gulf of 
Oman, the Persian Gulf, the Arabian Sea, the Red Sea, and the airspace 
above these locations.

(Authority: 38 U.S.C. 1117)

[60 FR 6665, Feb. 3, 1995, as amended at 62 FR 23139, Apr. 29, 1997; 66 
FR 56615, Nov. 9, 2001; 68 FR 34541, June 10, 2003; 71 FR 75672, Dec. 
18, 2006]



Sec. Sec. 3.318-3.320  [Reserved]

    Cross References: \1\

    Permanent and total disability ratings for pension purposes. See 
Sec. 3.342. Special monthly dependency and indemnity compensation, 
death compensation and pension ratings. See Sec. 3.351. Determination 
of permanent need for regular aid and attendance and ``permanently 
bedridden.'' See Sec. 3.352. Conditions which determine permanent 
incapacity for self-support. See Sec. 3.356.
---------------------------------------------------------------------------

    \1\ 39 FR 5315, Feb. 12, 1974.
---------------------------------------------------------------------------



Sec. 3.321  General rating considerations.

    (a) Use of rating schedule. The 1945 Schedule for Rating 
Disabilities will be used for evaluating the degree of disabilities in 
claims for disability compensation, disability and death pension, and in 
eligibility determinations. The provisions contained in the rating 
schedule will represent as far as can practicably be determined, the 
average impairment in earning capacity in civil occupations resulting 
from disability.


(Authority: 38 U.S.C. 1155)

    (b) Exceptional cases--(1) Compensation. Ratings shall be based as 
far as practicable, upon the average impairments of earning capacity 
with the additional proviso that the Secretary shall from time to time 
readjust this schedule of ratings in accordance with experience. To 
accord justice, therefore, to the exceptional case where the schedular 
evaluations are found to be inadequate, the Under Secretary for Benefits 
or the Director, Compensation and Pension Service, upon field station 
submission, is authorized to approve on the basis of the criteria set 
forth in this paragraph an extra-schedular evaluation commensurate with 
the average earning capacity impairment due exclusively to the service-
connected disability or disabilities. The governing norm in these 
exceptional cases is: A finding that the case presents such an 
exceptional or unusual disability picture with such related factors as 
marked interference with employment or frequent periods of 
hospitalization as to render impractical the application of the regular 
schedular standards.
    (2) Pension. Where the evidence of record establishes that an 
applicant for pension who is basically eligible fails

[[Page 248]]

to meet the disability requirements based on the percentage standards of 
the rating schedule but is found to be unemployable by reason of his or 
her disability(ies), age, occupational background and other related 
factors, the following are authorized to approve on an extra-schedular 
basis a permanent and total disability rating for pension purposes: the 
Veterans Service Center Manager; or where regular schedular standards 
are met as of the date of the rating decision, the rating board.
    (3) Effective dates. The effective date of these extra-schedular 
evaluations granting or increasing benefits will be in accordance with 
Sec. 3.400(b)(1) and (2) as to original and reopened claims and in 
accordance with Sec. 3.400(o) in claims for increased benefits.
    (c) Advisory opinion. Cases in which application of the schedule is 
not understood or the propriety of an extra-schedular rating is 
questionable may be submitted to Central Office for advisory opinion.

    Cross References: Effective dates; disability benefits. See Sec. 
3.400(b). Effective dates; increases. See Sec. 3.400(o).

[26 FR 1583, Feb. 24, 1961, as amended at 29 FR 1463, Jan. 29, 1964; 37 
FR 10442, May 23, 1972; 39 FR 5315, Feb. 12, 1974; 39 FR 32988, Sept. 
13, 1974; 40 FR 57459, Dec. 10, 1975; 61 FR 20727, May 8, 1996]



Sec. 3.322  Rating of disabilities aggravated by service.

    (a) Aggravation of preservice disability. In cases involving 
aggravation by active service, the rating will reflect only the degree 
of disability over and above the degree of disability existing at the 
time of entrance into active service, whether the particular condition 
was noted at the time of entrance into active service, or whether it is 
determined upon the evidence of record to have existed at that time. It 
is necessary to deduct from the present evaluation the degree, if 
ascertainable, of the disability existing at the time of entrance into 
active service, in terms of the rating schedule except that if the 
disability is total (100 percent) no deduction will be made. If the 
degree of disability at the time of entrance into service is not 
ascertainable in terms of the schedule, no deduction will be made.
    (b) Aggravation of service-connected disability. Where a disease or 
injury incurred in peacetime service is aggravated during service in a 
period of war, or conversely, where a disease or injury incurred in 
service during a period of war is aggravated during peacetime service, 
the entire disability flowing from the disease or injury will be service 
connected based on the war service.

    Cross References: Principles relating to service connection. See 
Sec. 3.303. Aggravation of preservice disability. See Sec. 3.306.

[26 FR 1583, Feb. 24, 1961]



Sec. 3.323  Combined ratings.

    (a) Compensation--(1) Same type of service. When there are two or 
more service-connected compensable disabilities a combined evaluation 
will be made following the tables and rules prescribed in the 1945 
Schedule for Rating Disabilities.
    (2) Wartime and peacetime service. Evaluation of wartime and 
peacetime service-connected compensable disabilities will be combined to 
provide for the payment of wartime rates of compensation. (38 U.S.C. 
1157) Effective July 1, 1973, it is immaterial whether the disabilities 
are wartime or peacetime service-connected since all disabilities are 
compensable under 38 U.S.C. 1114 and 1115 on and after that date.
    (b) Pension--(1) Nonservice-connected disabilities. Evaluation of 
two or more nonservice-connected disabilities not the result of the 
veteran's own willful misconduct will be combined as provided in 
paragraph (a)(1) of this section.
    (2) Service-connected and nonservice-connected disabilities. 
Evaluations for service-connected disabilities may be combined with 
evaluations for disabilities not shown to be service connected and not 
the result of the veteran's own willful misconduct.

    Cross References: ``Willful misconduct.'' See Sec. 3.1(n). Pension. 
See Sec. 3.3. Line of duty and misconduct. See Sec. 3.301. Service 
connection for mental unsoundness in suicide. See Sec. 3.302.

[26 FR 1583, Feb. 24, 1961, as amended at 38 FR 21923, Aug. 14, 1973; 61 
FR 20438, May 7, 1996]

[[Page 249]]



Sec. 3.324  Multiple noncompensable service-connected disabilities.

    Whenever a veteran is suffering from two or more separate permanent 
service-connected disabilities of such character as clearly to interfere 
with normal employability, even though none of the disabilities may be 
of compensable degree under the 1945 Schedule for Rating Disabilities 
the rating agency is authorized to apply a 10-percent rating, but not in 
combination with any other rating.

[40 FR 56435, Dec. 3, 1975]



Sec. 3.325  [Reserved]



Sec. 3.326  Examinations.

    For purposes of this section, the term examination includes periods 
of hospital observation when required by VA.
    (a) Where there is a claim for disability compensation or pension 
but medical evidence accompanying the claim is not adequate for rating 
purposes, a Department of Veterans Affairs examination will be 
authorized. This paragraph applies to original and reopened claims as 
well as claims for increase submitted by a veteran, surviving spouse, 
parent, or child. Individuals for whom an examination has been scheduled 
are required to report for the examination.
    (b) Provided that it is otherwise adequate for rating purposes, any 
hospital report, or any examination report, from any government or 
private institution may be accepted for rating a claim without further 
examination. However, monetary benefits to a former prisoner of war will 
not be denied unless the claimant has been offered a complete physical 
examination conducted at a Department of Veterans Affairs hospital or 
outpatient clinic.
    (c) Provided that it is otherwise adequate for rating purposes, a 
statement from a private physician may be accepted for rating a claim 
without further examination.

(Authority: 38 U.S.C. 5107(a))

    Cross Reference: Failure to report for VA examination. See Sec. 
3.655.

[60 FR 52864, Oct. 11, 1995, as amended at 66 FR 45632, Aug. 29, 2001]



Sec. 3.327  Reexaminations.

    (a) General. Reexaminations, including periods of hospital 
observation, will be requested whenever VA determines there is a need to 
verify either the continued existence or the current severity of a 
disability. Generally, reexaminations will be required if it is likely 
that a disability has improved, or if evidence indicates there has been 
a material change in a disability or that the current rating may be 
incorrect. Individuals for whom reexaminations have been authorized and 
scheduled are required to report for such reexaminations. Paragraphs (b) 
and (c) of this section provide general guidelines for requesting 
reexaminations, but shall not be construed as limiting VA's authority to 
request reexaminations, or periods of hospital observation, at any time 
in order to ensure that a disability is accurately rated.


(Authority: 38 U.S.C. 501)

    (b) Compensation cases--(1) Scheduling reexaminations. Assignment of 
a prestabilization rating requires reexamination within the second 6 
months period following separation from service. Following initial 
Department of Veterans Affairs examination, or any scheduled future or 
other examination, reexamination, if in order, will be scheduled within 
not less than 2 years nor more than 5 years within the judgment of the 
rating board, unless another time period is elsewhere specified.
    (2) No periodic future examinations will be requested. In service-
connected cases, no periodic reexamination will be scheduled: (i) When 
the disability is established as static;
    (ii) When the findings and symptoms are shown by examinations 
scheduled in paragraph (b)(2)(i) of this section or other examinations 
and hospital reports to have persisted without material improvement for 
a period of 5 years or more;
    (iii) Where the disability from disease is permanent in character 
and of such nature that there is no likelihood of improvement;
    (iv) In cases of veterans over 55 years of age, except under unusual 
circumstances;

[[Page 250]]

    (v) When the rating is a prescribed scheduled minimum rating; or
    (vi) Where a combined disability evaluation would not be affected if 
the future examination should result in reduced evaluation for one or 
more conditions.
    (c) Pension cases. In nonservice-connected cases in which the 
permanent total disability has been confirmed by reexamination or by the 
history of the case, or with obviously static disabilities, further 
reexaminations will not generally be requested. In other cases further 
examination will not be requested routinely and will be accomplished 
only if considered necessary based upon the particular facts of the 
individual case. In the cases of veterans over 55 years of age, 
reexamination will be requested only under unusual circumstances.

    Cross Reference: Failure to report for VA examination. See Sec. 
3.655.

[26 FR 1585, Feb. 24, 1961, as amended at 30 FR 11855, Sept. 16, 1965; 
36 FR 14467, Aug. 6, 1971; 55 FR 49521, Nov. 29, 1990; 60 FR 27409, May 
24, 1995]



Sec. 3.328  lndependent medical opinions.

    (a) General. When warranted by the medical complexity or controversy 
involved in a pending claim, an advisory medical opinion may be obtained 
from one or more medical experts who are not employees of VA. Opinions 
shall be obtained from recognized medical schools, universities, clinics 
or medical institutions with which arrangements for such opinions have 
been made, and an appropriate official of the institution shall select 
the individual expert(s) to render an opinion.
    (b) Requests. A request for an independent medical opinion in 
conjunction with a claim pending at the regional office level may be 
initiated by the office having jurisdiction over the claim, by the 
claimant, or by his or her duly appointed representative. The request 
must be submitted in writing and must set forth in detail the reasons 
why the opinion is necessary. All such requests shall be submitted 
through the Veterans Service Center Manager of the office having 
jurisdiction over the claim, and those requests which in the judgment of 
the Veterans Service Center Manager merit consideration shall be 
referred to the Compensation and Pension Service for approval.
    (c) Approval. Approval shall be granted only upon a determination by 
the Compensation and Pension Service that the issue under consideration 
poses a medical problem of such obscurity or complexity, or has 
generated such controversy in the medical community at large, as to 
justify solicitation of an independent medical opinion. When approval 
has been granted, the Compensation and Pension Serv