
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC1503]

 
                      TITLE 38--VETERANS' BENEFITS
 
                        PART II--GENERAL BENEFITS
 
CHAPTER 15--PENSION FOR NON-SERVICE-CONNECTED DISABILITY OR DEATH OR FOR 
                                 SERVICE
 
                          SUBCHAPTER I--GENERAL
 
Sec. 1503. Determinations with respect to annual income

    (a) In determining annual income under this chapter, all payments of 
any kind or from any source (including salary, retirement or annuity 
payments, or similar income, which has been waived, irrespective of 
whether the waiver was made pursuant to statute, contract, or otherwise) 
shall be included except--
        (1) donations from public or private relief or welfare 
    organizations;
        (2) payments under this chapter;
        (3) amounts equal to amounts paid by a spouse of a veteran for 
    the expenses of such veteran's last illness, and by a surviving 
    spouse or child of a deceased veteran for--
            (A) such veteran's just debts,
            (B) the expenses of such veteran's last illness, and
            (C) the expenses of such veteran's burial to the extent such 
        expenses are not reimbursed under chapter 23 of this title;

        (4) amounts equal to amounts paid--
            (A) by a veteran for the last illness and burial of such 
        veteran's deceased spouse or child, or
            (B) by the spouse of a living veteran or the surviving 
        spouse of a deceased veteran for the last illness and burial of 
        a child of such veteran;

        (5) reimbursements of any kind for any casualty loss (as defined 
    in regulations which the Secretary shall prescribe), but the amount 
    excluded under this clause may not exceed the greater of the fair 
    market value or reasonable replacement value of the property 
    involved at the time immediately preceding the loss;
        (6) profit realized from the disposition of real or personal 
    property other than in the course of a business;
        (7) amounts in joint accounts in banks and similar institutions 
    acquired by reason of death of other joint owner;
        (8) amounts equal to amounts paid by a veteran, veterans' 
    spouse, or surviving spouse or by or on behalf of a veteran's child 
    for unreimbursed medical expenses, to the extent that such amounts 
    exceed 5 percent of the maximum annual rate of pension (including 
    any amount of increased pension payable on account of family members 
    but not including any amount of pension payable because a person is 
    in need of regular aid and attendance or because a person is 
    permanently housebound) payable to such veteran, surviving spouse, 
    or child;
        (9) in the case of a veteran or surviving spouse pursuing a 
    course of education or vocational rehabilitation or training, 
    amounts equal to amounts paid by such veteran or surviving spouse 
    for such course of education or vocational rehabilitation or 
    training, including (A) amounts paid for tuition, fees, books, and 
    materials, and (B) in the case of such a veteran or surviving spouse 
    in need of regular aid and attendance, unreimbursed amounts paid for 
    unusual transportation expenses in connection with the pursuit of 
    such course of education or vocational rehabilitation or training, 
    to the extent that such amounts exceed the reasonable expenses which 
    would have been incurred by a nondisabled person using an 
    appropriate means of transportation (public transportation, if 
    reasonably available); and
        (10) 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--
            (A) the lowest amount of gross income for which an income 
        tax return is required under section 6012(a) of the Internal 
        Revenue Code of 1986, to be filed by an individual who is not 
        married (as determined under section 7703 of such Code), 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
            (B) if the child is pursuing a course of postsecondary 
        education or vocational rehabilitation or training, the amount 
        paid by such child for such course of education or vocational 
        rehabilitation or training, including the amount paid for 
        tuition, fees, books, and materials.

    (b) Where a fraction of a dollar is involved, annual income shall be 
fixed at the next lower dollar.

(Pub. L. 85-857, Sept. 2, 1958, 72 Stat. 1134, Sec. 503; Pub. L. 86-211, 
Sec. 2(a), Aug. 29, 1959, 73 Stat. 432; Pub. L. 87-268, Sec. 1(b), Sept. 
21, 1961, 75 Stat. 566; Pub. L. 88-664, Sec. 1, Oct. 13, 1964, 78 Stat. 
1094; Pub. L. 90-77, title I, Sec. 103, Aug. 31, 1967, 81 Stat. 178; 
Pub. L. 91-588, Sec. 7, Dec. 24, 1970, 84 Stat. 1584; Pub. L. 92-198, 
Sec. 2, Dec. 15, 1971, 85 Stat. 664; Pub. L. 92-425, Sec. 6(2), Sept. 
21, 1972, 86 Stat. 713; Pub. L. 94-169, title I, Secs. 101(2)(A), 
106(3)-(8), Dec. 23, 1975, 89 Stat. 1013, 1017; Pub. L. 95-588, title I, 
Sec. 102, Nov. 4, 1978, 92 Stat. 2497; Pub. L. 97-295, Sec. 4(13), Oct. 
12, 1982, 96 Stat. 1305; Pub. L. 100-687, div. B, title XIV, 
Sec. 1402(b), Nov. 18, 1988, 102 Stat. 4130; Pub. L. 102-54, 
Sec. 14(b)(5), June 13, 1991, 105 Stat. 283; renumbered Sec. 1503 and 
amended Pub. L. 102-83, Secs. 4(b)(1), (2)(E), 5(a), Aug. 6, 1991, 105 
Stat. 404-406.)

                       References in Text

    Sections 2, 6012(a), and 7703 of the Internal Revenue Code of 1986, 
referred to in subsec. (a)(10)(A), are classified to sections 2, 
6012(a), and 7703 of Title 26, Internal Revenue Code, respectively.


                            Prior Provisions

    Prior section 1503 was renumbered section 3103 of this title.
    Another prior section 1503, added Pub. L. 89-138, Sec. 1, Aug. 26, 
1965, 79 Stat. 577; amended Pub. L. 91-24, Sec. 8, June 11, 1969, 83 
Stat. 34; Pub. L. 94-502, title I, Secs. 102, 104(2), (3), Oct. 15, 
1976, 90 Stat. 2384, related to periods of eligibility for vocational 
rehabilitation under chapter 31 of this title, prior to the general 
revision of chapter 31 of this title by Pub. L. 96-466. Section 
802(a)(3) of Pub. L. 96-466, set out as an Effective Date note under 
section 3100 of this title, provided that this prior section 1503 
continue in effect until Mar. 31, 1981.
    Another prior section 1503, Pub. L. 85-857, Sept. 2, 1958, 72 Stat. 
1171, was renumbered 1511 by Pub. L. 89-138, Sec. 2(4), Aug. 26, 1965, 
79 Stat. 578.


                               Amendments

    1991--Pub. L. 102-83, Sec. 5(a), renumbered section 503 of this 
title as this section.
    Subsec. (a)(5). Pub. L. 102-83, Sec. 4(b)(1), (2)(E), substituted 
``Secretary'' for ``Administrator''.
    Subsec. (a)(8). Pub. L. 102-54, Sec. 14(b)(5)(A), substituted 
``percent'' for ``per centum''.
    Subsec. (a)(10)(A). Pub. L. 102-54, Sec. 14(b)(5)(B), substituted 
``Internal Revenue Code of 1986'' for ``Internal Revenue Code of 1954 
(26 U.S.C. 6012(a))'' and ``section 7703'' for ``section 143''.
    1988--Subsec. (a)(5). Pub. L. 100-687 amended par. (5) generally. 
Prior to amendment, par. (5) read as follows: ``proceeds of fire 
insurance policies;''.
    1982--Subsec. (a)(10)(A). Pub. L. 97-295 inserted ``(26 U.S.C. 
6012(a))'' after ``Code of 1954''.
    1978--Subsec. (a)(1). Pub. L. 95-588, Sec. 102(a)(1), (2), 
redesignated par. (2) as (1) and struck out former par. (1) which 
related to payments of six-months death gratuity.
    Subsec. (a)(2). Pub. L. 95-588, Sec. 102(a)(3), redesignated par. 
(3) as (2) and, as so redesignated, struck out ``, and chapters 11 and 
13 (except section 412(a)) of this title'' after ``chapter''. Former 
par. (2) redesignated (1).
    Subsec. (a)(3). Pub. L. 95-588, Sec. 102(a)(5), redesignated par. 
(7) as (3). Former par. (3) redesignated (2).
    Subsec. (a)(4). Pub. L. 95-588, Sec. 102(a)(4), (6), added par. (4) 
and struck out former par. (4) which related to payments under 
servicemen's life insurance or servicemen's indemnity.
    Subsec. (a)(5). Pub. L. 95-588, Sec. 102(a)(4), (7), redesignated 
par. (8) as (5) and struck out former par. (5) which related to lump sum 
death payments.
    Subsec. (a)(6). Pub. L. 95-588, Sec. 102(a)(4), (9), redesignated 
par. (10) as (6) and struck out former par. (6) which related to the ten 
per cent exclusion for individuals under public or private retirement, 
annuity, endowment, or similar programs.
    Subsec. (a)(7). Pub. L. 95-588, Sec. 102(a)(11), redesignated par. 
(15) as (7). Former par. (7) redesignated (3).
    Subsec. (a)(8). Pub. L. 95-588, Sec. 102(a)(13), added par. (8). 
Former par. (8) redesignated (5).
    Subsec. (a)(9). Pub. L. 95-588, Sec. 102(a)(8), (13), added par. (9) 
and struck out former par. (9) which related to payments for final 
illness and burial.
    Subsec. (a)(10). Pub. L. 95-588, Sec. 102(a)(13), added par. (10). 
Former subsec. (10) redesignated (6).
    Subsec. (a)(11) to (14). Pub. L. 95-588, Sec. 102(a)(10), struck out 
pars. (11) to (14) which related to payments for discharge of jury duty, 
educational assistance allowances, bonuses based on service in the Armed 
Forces, and indebtednesses secured by mortgages, respectively.
    Subsec. (a)(15). Pub. L. 95-588, Sec. 102(a)(11), redesignated par. 
(15) as (7).
    Subsec. (a)(16), (17). Pub. L. 95-588, Sec. 102(a)(12), struck out 
pars. (16) and (17) which related to payments received by retired 
persons and payments of annuities, respectively.
    Subsec. (c). Pub. L. 95-588, Sec. 102(b), struck out former subsec. 
(c) which related to the power of the Administrator to exclude from 
income amounts paid by a veteran, surviving spouse, or child for unusual 
medical expenses.
    1975--Subsec. (a)(7). Pub. L. 94-169, Sec. 106(3), (4), substituted 
``spouse'' for ``wife'', ``such veteran's'' for ``his'' and ``surviving 
spouse'' for ``widow'' in introductory clause and ``such veteran's'' for 
``his'' in subcls. (A), (B) and (C).
    Subsec. (a)(9). Pub. L. 94-169, Sec. 106(5), substituted ``such 
veteran's'' for ``his'' in subcl. (A) and ``surviving spouse'' and 
``spouse'' for ``widow'' and ``wife'', respectively, in subcl. (B).
    Subsec. (a)(14). Pub. L. 94-169, Sec. 106(6), substituted ``such 
veteran's surviving spouse'' for ``his widow''.
    Subsec. (a)(16). Pub. L. 94-169, Secs. 101(2)(A), 106(7), inserted 
``and'' after ``as amended;'', and substituted ``such employee's'' for 
``his'', respectively.
    Subsec. (c). Pub. L. 94-169, Sec. 106(8), substituted ``surviving 
spouse'' for ``widow''.
    1972--Par. (17). Pub. L. 92-425 substituted ``subchapter I of 
chapter 73 of title 10'' for ``chapter 73 of title 10''.
    1971--Pub. L. 92-198 designated existing provisions as subsec. (a) 
and added subsecs. (b) and (c).
    1970--Par. (4). Pub. L. 91-588, Sec. 7(1), inserted reference to 
servicemen's group life insurance.
    Pars. (14) to (17). Pub. L. 91-588, Sec. 7(3), added pars. (14) to 
(17).
    1967--Par. (7). Pub. L. 90-77, Sec. 103(a), provided for exclusion 
of amounts paid by a wife of a veteran for the expenses of his past 
illness.
    Par. (9). Pub. L. 90-77, Sec. 103(b), designated existing provisions 
as subpar. (A) and added subpar. (B).
    1964--Par. (6). Pub. L. 88-664, Sec. 1(a), inserted ``10 per centum 
of the amount of'' before ``payments'' and struck out ``equal to his 
contributions thereto'' after ``programs''.
    Pars. (9) to (13). Pub. L. 88-664, Sec. 1(b), added pars. (9) to 
(13).
    1961--Pub. L. 87-268 substituted ``section 412(a)'' for ``section 
412''.
    1959--Pub. L. 86-211 among other changes, required the inclusion of 
all payments of any kind or from any source (including salary, 
retirement or annuity payments, or similar income, which has been 
waived), and permitted the exclusion of donations from public or private 
relief or welfare organizations, payments under policies of United 
States Government life insurance or National Service Life Insurance, and 
payments of servicemen's indemnity, lump sum death payments, payments to 
an individual under public or private retirement, annuity, endowment, or 
similar plans or programs equal to his contributions thereto, amounts 
equal to amounts paid by a widow or child for the veteran's just debts, 
expenses of his last illness, and expenses of his burial to the extent 
such expenses are not reimbursed under chapter 23 of this title, and 
proceeds of life insurance policies.


                    Effective Date of 1978 Amendment

    Amendment by Pub. L. 95-588 effective Jan. 1, 1979, see section 401 
of Pub. L. 95-588, set out as a note under section 101 of this title.


                    Effective Date of 1975 Amendment

    Sections 101 and 106 of Pub. L. 94-169 provided that the amendments 
made by those sections are effective Jan. 1, 1976.


                    Effective Date of 1971 Amendment

    Amendment by Pub. L. 92-198 effective Jan. 1, 1972, see section 6 of 
Pub. L. 92-198, set out as a note under section 1521 of this title.


                    Effective Date of 1970 Amendment

    Amendment by Pub. L. 91-588 effective Jan. 1, 1971, see section 
10(a) of Pub. L. 91-588, set out as a note under section 1521 of this 
title.


                    Effective Date of 1967 Amendment

    Amendment by Pub. L. 90-77 effective first day of first calendar 
month which begins more than ten days after Aug. 31, 1967, see section 
405 of Pub. L. 90-77, set out as a note under section 101 of this title.


                    Effective Date of 1964 Amendment

    Section 11 of Pub. L. 88-664 provided that:
    ``(a) Except as otherwise provided herein, this Act [amending this 
section and sections 502, 506, 521, 541, 542, 612, and 3104 [now 1502, 
1506, 1521, 1541, 1542, 1712, and 5304] of this title and enacting 
provisions set out as a note under section 1521 of this title] shall 
take effect on January 1, 1965.
    ``(b) The amendment to paragraph (6) of section 503 [now 1503], 
title 38, United States Code, shall not apply to any individual 
receiving pension on December 31, 1964, under chapter 15 of said title, 
or subsequently determined entitled to such pension for said day, until 
his contributions have been recouped under the provision of that 
paragraph in effect on December 31, 1964.''


                    Effective Date of 1961 Amendment

    Amendment by Pub. L. 87-268 effective Oct. 1, 1961, see section 3 of 
Pub. L. 87-268, set out as a note under section 1312 of this title.


                    Effective Date of 1959 Amendment

    Amendment by Pub. L. 86-211 effective July 1, 1960, see section 10 
of Pub. L. 86-211, set out as an Effective Date note under section 1506 
of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 111, 1710, 1710B, 1722A of 
this title.
