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Updated Aug 12, 2024

In This Section
This section contains the following topics:
Topic
Topic Name
1
2
3
4
     5
6

1.  Applications for Accrued and Requests for Substitution

Introduction
This topic contains information on developing for accrued benefits, including

Change Date
February 7, 2022

XI.ii.3.C.1.a.  Applications for Accrued Benefits
A claim for accrued benefits may be filed on the following applications:
Notes:
  • If the claimant submits a VA Form 21P-534EZ and does not check the accrued radio button, the Department of Veterans Affairs (VA) is still obligated to address the claimant’s entitlement to accrued benefits under 38 CFR 3.152(b).
  • VA Form 21P-0847, is not considered a prescribed form for accrued benefits for claimants other than a surviving spouse that meets the criteria listed above.  If accrued benefits exist follow M21-1, Part XI, Subpart ii, 3.C.1.c to request the proper application for accrued.
  • VA Form 21P-534 and VA Form 21P-534EZ can be used to grant accrued benefits based on relationship.  If an adult child who is not entitled to benefits by relationship applies using either form, send the claimant VA Form 21P-601.

XI.ii.3.C.1.b.  Applications for a Request to Substitute
A standard application is not required to request to substitute.  A request to substitute, from an individual in the categories of eligible persons, is deemed to be included when VA receives a
  • claim for
    • accrued benefits
    • Survivors Pension, or
    • Dependency and Indemnity Compensation, or
  • a written request to substitute containing the
    • intent to substitute
    • name of the person requesting to substitute
    • name of the deceased claimant, and
    • deceased claimant’s
      • claim number
      • Social Security number, or
      • appeal number.
Exception:   When an accrued claim is received that does not indicate a request to substitute, and there is not a pending claim or appeal pending, do not address substitution.
References:  For more information on

XI.ii.3.C.1.c.  Action to Take When Accrued Benefits Exist but No Claim Is Filed
If an accrued claim is not filed and accrued benefits exist, or an initial claim, decision review request, or appeal is pending, VA has an obligation to notify those individuals who are potentially entitled to the benefits.  Send VA Form 21P-601 to the
  • surviving spouse, child or children, or parents of the Veteran, in the order named, if in existence, or
  • person(s) who paid for, or are responsible to pay, the expenses of last illness and/or burial of a beneficiary, if it appears that no person is entitled to benefits by relationship.
Note:  Send a VA Form 21P-601 even when there is no evidence of accrued benefits and an initial claim, request for decision review, or legacy appeal was pending at the time of the original claimant’s death.  For language to include in the letter when mailing out VA Form 21P-601 when there is no evidence of accrued, see M21-1, Part XI, Subpart ii, 3.C.1.g.
References:  For more information on

XI.ii.3.C.1.d.  Information to Include on Notification Letter With VA Form 21P-601
In the notification letter, refer the claimant to the attached VA Form 21P-601 and its instructions for information on the
  • time limits to apply for accrued benefits
  • time limits to request substitution, if applicable, and
  • evidence to submit with the claim.

XI.ii.3.C.1.e.  Application Filing Time Limits
Use the table below to determine the proper time limit for applying for accrued benefits.
If …
Then …
accrued benefits are payable other than
the claimant, within one year of the original claimant’s death, must submit the accrued application.
The one-year limitation for filing a claim for accrued benefits also applies to cases in which a
  • rating or authorization decision was made prior to the date of death, or
  • claim, higher-level review (HLR), or a legacy appeal was pending and evidence sufficient to allow that claim or legacy appeal was in file at the date of death.
an accrued lump sum is payable under 38 CFR 3.1001
the application must be filed within five years of the Veteran’s death.
only proceeds of returned and canceled checks are payable under 38 CFR 3.1003
there is no time limit for filing a claim.

XI.ii.3.C.1.f.  Request for Substitution Time Limits
A person may not substitute for a deceased claimant unless the person files a request to substitute no later than one year after the claimant’s death.

XI.ii.3.C.1.g.  Language to Include on Request for Substitution Letters When There Is No Evidence of Accrued
Use the following language when notifying a claimant of a pending claim, request for decision review or appeal and there is no evidence of accrued benefits:
[Insert original claimant’s name] had a claim higher-level review or appeal pending at the time of death.  A person eligible for accrued benefits may request to substitute for a deceased claimant who had a pending claim or appeal at the time of death.  Substitution may allow a person to submit evidence in support of the pending claim or appeal for potential accrued benefits. 
If you wish to file a request for substitution and have not already done so, please complete and return VA Form 21P-601 as indicated in the instructions under, “Where Do I Send My Completed Form?”.  We will make a determination at that time whether you are eligible to substitute.  The request to substitute must be received within one year of the deceased claimant’s death.  Filling out this form will also allow VA to make a determination on accrued benefits.

2.  Section 5103 Notices

Change Date
August 12, 2024

XI.ii.3.C.2.a.  When to Send a Section 5103 Notice
VA has a duty to assist claimants in obtaining evidence as required by the Veterans Claims Assistance Act of 2000, Public Law 106-475.  This includes sending the claimant a Section 5103 notice letter.
For accrued or substitution claims, a Section 5103 notice letter may be required for several reasons, including
  • if development is needed in support of a claim that was pending at the time of the original claimant’s death
  • a supplemental claim that originates from a Section 5103 error discovered upon an HLR
  • if development is needed in support of the accrued claim after eligibility is established for proof of death, and
  • if verification of reimbursable expenses is required.  Verification includes
    • a receipt bill
    • statement on the provider’s letterhead, and
    • bank statements showing payment.
References:  For more information on

3.  When Development for Eligibility of Accrued Benefits and the Right to Substitution Is Not Required

Introduction
This topic contains information on developing for eligibility of accrued benefits and the right to substitution, including

Change Date
August 12, 2024

XI.ii.3.C.3.a. Definition:  Evidence Needed to Complete the Application for Accrued Benefits
Evidence needed to complete the application for accrued benefits means information necessary to establish that
  • the claimant is within the category of eligible persons, and
  • circumstances exist which make the claimant the specific person entitled to the accrued benefit (to include proof payment was made if the claim is based on reimbursement).
Notes:
  • Proof payment was made, for purposes of deeming the application complete for accrued benefits based on reimbursement, may come from the claimant as a statement or an indication on the VA form that the expenses of last sickness or burial were paid.
  • Verification of paid expenses is required to grant accrued benefits based on reimbursement.  If verification is not of record, develop under M21-1, Part XI, Subpart ii, 3.C.2.a before deciding the claim.
Important:  If a potential surviving spouse is attempting to qualify for accrued benefits based on relationship status, and is using VA Form 21P-601 or VA Form 21P-0847, the application for accrued benefits is only complete if complete marital history is of record to satisfy the requirements of 38 CFR 3.1(j).

XI.ii.3.C.3.b.  Definition:  Evidence Needed to Complete the Request to Substitute
Evidence needed to complete the request to substitute means information necessary to establish
  • the claimant is
    • in the categories of eligible persons, and
    • first in priority order, and
  • proof payment was made, if the claim is based on reimbursement.
Notes:
  • Proof payment was made, when necessary to deem the request to substitute complete, may come from the claimant as a statement or an indication on the VA form that the expenses of last sickness or burial were paid.
  • If the claim is complete but verification of paid expenses is not of record, develop under M21-1, Part XI, Subpart ii, 3.C.2.a before deciding the claim.
Important:  If a potential surviving spouse is attempting to qualify as a substitute claimant based on relationship status, the request to substitute is only complete if complete marital history is of record to satisfy the requirements of 38 CFR 3.1(j).

XI.ii.3.C.3.c.  When to Deny Accrued or Substitution Claims Without Development
It is not required to issue development when
  • accrued benefits do not exist
  • there is a lack of legal eligibility
  • the claim lacks merit, or
  • the claimant is not entitled to the benefit as a matter of law.
Reference:  For more information on VA’s duty to assist, see M21-1, Part I, Subpart i, 1.A.

XI.ii.3.C.3.d.  Notification Requirements for Incomplete Accrued Claims
If the claimant did not provide evidence of eligibility for accrued benefits, the application is considered incomplete.  VA is not required to send a Section 5103 notice letter.  The examples below apply to standalone applications for accrued benefits (VA Form 21P-601 or VA Form 21P-0847).
Example 1:  A child between the ages of 18 to 23 submits VA Form 21P-601 for accrued based on relationship with a copy of their birth certificate, but does not submit proof they were enrolled in school at the time of the payee’s death.  The child is not an established dependent on the payee’s award.  There is also no evidence showing the claimant paid reimbursable expenses.  The application for accrued benefits is considered incomplete per 38 CFR 3.1000(c)(1) because the claimant has not provided evidence of eligibility showing they are a qualifying child.
Example 2:  A potential surviving spouse submits VA Form 21P-601 for accrued based on relationship but does not provide complete marital history information.  The claims file does not show evidence of a spouse prior to the Veteran’s death.  There is also no evidence showing the potential spouse paid reimbursable expenses.  The application for accrued benefits is considered incomplete per 38 CFR 3.1000(c)(1) because the claimant has not provided evidence of eligibility.
Follow the steps in the table below when the application for accrued benefits is considered incomplete.
Step
Action
1
Change the established end product (EP) 165 to an EP 400 with an Incomplete Application claim label.
2
Notify the claimant
  • of the type of information required to complete the application
  • that VA will take no further action on the claim unless VA receives the required information, and
  • that if VA does not receive the required information within one year of the date of the original VA notification of information required, no benefits will be awarded on the basis of that application.
3
Include the application form that does not provide evidence of eligibility for accrued benefits as an enclosure to the letter.
4
Add the letter to the claims folder.
5
Clear the EP 400.
Note:  If the steps in the table above were not followed and development was initiated in error, see M21-1, Part III, Subpart i, 2.D.2.g for guidance.
References:  For more information on

XI.ii.3.C.3.e.  Notification Requirements for Incomplete Requests for  Substitution 
If a person’s request to substitute does not include complete evidence of eligibility when it is originally submitted, the claim is considered incomplete.  VA is not required to send a Section 5103 notice letter.  The example below applies to standalone requests for substitution (VA Form 21P-601 or VA Form 21P-0847).
Example:  The Veteran’s descendant, who is over the age of 23, submits VA Form 21P-0847, but does not indicate that reimbursable expenses were paid.  The request for substitution is incomplete because the claimant has not provided evidence of eligibility demonstrating that they are among those listed in the categories of eligible persons according to 38 CFR 3.1000 (a)(1)-(5).
Follow the steps in the table below when a request for substitution is considered incomplete.
Step
Action
1
Change the established EP 165 or EP 290, as applicable to an EP 400 with an Incomplete Application claim label.
2
Notify the claimant
  • of the evidence of eligibility required to complete the request to substitute
  • that VA will take no further action on the request to substitute unless VA receives the evidence of eligibility, and
  • that VA must receive the evidence of eligibility no later than 60 days after the date of notification or one year after the claimant’s death, whichever is later, or VA will deny the request to substitute.
3
Include the application form (if applicable) that does not provide evidence of eligibility to substitute as an enclosure to the letter.
4
Add the letter to the claims folder.
5
Clear the EP 400.

XI.ii.3.C.3.f.  Time Limits for Evidence of Eligibility
Use the table below to determine the proper time limit for receiving evidence of eligibility after initial notification.
If the claim is …
Then VA must receive the evidence of eligibility …
accrued
within one year of the date of the original VA notification.
a request for substitution
the later date of the following:
  • 60 days after the date of the original VA notification, or
  • within one year of the claimants death.
Reference:  For more information on timelines and examples of timelines for substitute claimants to take action, see M21-1, Part XI, Subpart ii, 3.B.3.

XI.ii.3.C.3.g.  Example:  Denial of a Request for Substitution With a Response Not Timely Filed and an Accrued Claim With a Timely Response
Situation:
  • On 01/14/2022, the Veteran files a claim for coronary artery disease.
  • On 07/01/2022, VA issues the Veteran a notice granting the coronary artery disease at 50 percent.
  • On 08/13/2022, the Veteran dies.
  • On 06/01/2023, VA receives an accrued claim, however, evidence of eligibility was not of record.
  • On 09/01/2023, VA issues a notification to the claimant advising that evidence of eligibility is not of record.  The claimant is provided 60 days to submit the information for the request for substitution and 1 year from the date of the notification for the accrued claim.
  • On 12/22/2023, VA receives evidence of eligibility.
Result:
  • Deny the request for substitution as the evidence of eligibility was not timely filed, and
  • work the accrued claim based on the evidence of the file, as the evidence was received timely, granting or denying accrued based on evidence.

XI.ii.3.C.3.h.  Example:  Timely Filed Response for Substitution and Accrued Claim
Situation:
This situation is similar to Example 1, except VA receives the evidence of eligibility on 10/01/2023.
Result:
Take the following actions:
  • grant the substitution request and notify the substitute claimant
    • that the Veteran was granted 50 percent for coronary artery disease
    • of the date the decision was mailed to the Veteran, and
    • of the remaining time the Veteran has to appeal and provide the applicable appeal language and notifications, and
  • deny or grant the accrued benefits when all the information is available, providing the applicable appeal language and notifications.
Reference:  For more information on the applicable appeal language to provide, see M21-1, Part XI, Subpart ii, 3.C.5.c.

XI.ii.3.C.3.i.  Example:  Not Timely Filed Response in an Accrued Claim and Request for Substitution
Situation:
This situation is similar to Example 1, except VA receives the evidence of eligibility on 12/18/2024.
Result:
Deny the accrued claim and the request to substitute as the evidence of eligibility was not timely filed.

4.  Development of the Original Claimant’s Pending Claim

Introduction
This topic contains information on development for pending claims after a grant of substitution, including

Change Date
February 7, 2022

XI.ii.3.C.4.a.  When Development, Including the Section 5103 Notice, Is Required
Additional development is required if
  • a Section 5103 notice for the original claimant’s claim was
    • not sent, or
    • inadequate
    • original claimant requested assistance with obtaining, or
    • substitute claimant requested assistance with obtaining
  • a duty to assist error is discovered upon an HLR and the maximum benefit cannot be granted, or
  • sending a development letter for which a Section 5103 notice does not apply (for example, a pension income adjustment) if the development letter was
    • not sent, or
    • inadequate.
Important:  If a medical opinion is needed, include information in the development letter informing the recipient that VA is requesting a medical opinion.
Note:  If an adequate notice was sent to the original claimant and had not expired at the time of death, reissue the notice.  Provide only the amount of time that was remaining on the original claimant’s notice at the time of the payee’s death.

XI.ii.3.C.4.b.  When Development, Including the Section 5103 Notice, Is Not Required
Additional development is not required if it is determined all development actions have been completed during the original claimant’s lifetime and it is determined the original claimant
  • received an adequate Section 5103 notice and the pending claim(s) was/were
    • decided during their lifetime, but the claim(s) is/are not finally adjudicated, or
    • not decided during their lifetime
  • submitted the claim on an EZ form, or
  • submitted a claim in which
    • the Section 5103 notice does not apply (for example, a pension income adjustment, a request for an HLR, or a supplemental claim received within one year of the initial claim), and
    • adequate development was sent to the original claimant.
Reference:  For more information on finality of decisions, see M21-1, Part X, Subpart ii, 1.A.

XI.ii.3.C.4.c.  When the Development Control Period Has Expired or Necessary Evidence Is Received
If development was necessary, review the claim again when the development control period has expired, or the necessary evidence is received, whichever is earlier, and take the following actions:
  • if there is a rating issue, forward the claim to the rating activity before adjudicating the claim, or
  • if there is not a rating issue, adjudicate the claim.
References:  For more information on

XI.ii.3.C.4.d.  Considering FTI Income in Substitution and Accrued Claims
Federal tax information (FTI) should be considered in substitution and accrued claims that have a valid substitute claimant when a claim for pension was pending at the time of the original claimant’s death and the
  • FTI is available
  • sum of the total income reported by the Internal Revenue Service (IRS)/Social Security Administration (SSA) is higher than the sum of the total income reported on the original application, and
  • FTI income is considered countable for VA purposes.
In these cases, a valid substitute claimant has the same rights as would have applied to the original claimant as described in M21-1, Part XI, Subpart ii, 3.B.3.b.  However, development to a valid substitute claimant should not include specific information regarding FTI.  Use the following language when development is needed for verification of FTI:
We received information that [insert original claimant’s name] received income from other sources not listed on their original application for benefits.  Please submit all tax return or other evidence regarding all [insert original claimant’s name] sources of income.  The evidence should provide documentation of the actual income amounts the original claimant received from all these sources.  Failure to provide verification of income may result in a denial of your claim.  
Notes:
  • Evidence received from the valid substitute claimant is considered first-party evidence for VA purposes.  Do not disclose FTI itself to a substitute claimant unless financial information has been verified as first-party evidence from a claimant.
  • FTI made available to VA within matching programs with IRS or SSA should be considered in the net worth calculation as indicated within M21-1, Part IX, Subpart iii, 1.J.4 and 5.
Use the table below to determine action to take once the claimant responds or the time limit expires.
If the claimant …
Then …
provides substantiating evidence that verifies the actual income to be the same, more or less than reported by IRS/SSA
use the amounts verified by the valid substitute claimant.
  • does not provide substantiating evidence clarifying the actual income amounts in question
  • provides evidence, however the evidence appears to be incomplete (does not list all sources of income), or
  • does not respond
deny the claim for failure to prosecute.
Reference:  For more information on which sources of income are considered income for VA purposes and for upfront verification, see the FTI Income Reference Sheet located on the Pension and Fiduciary Service homepage.

XI.ii.3.C.4.e.  Language to Include in the Development Letter if the Applicant Did Not Specifically Request Substitution
Use the following language in the development letter if the applicant did not specifically request substitution and there was a pending claim or appeal at the time of the original claimant’s death.
VA has received your claim for accrued benefits and accepted this claim as a request for substitution for the purpose of completing [insert original claimant’s name] [insert claim or appeal] pending at the time of death.  The request for substitution allows you to submit additional evidence in support of the pending [insert claim or appeal].  As mentioned in a previous letter, we have granted the request for substitution. 

XI.ii.3.C.4.f.  Language to Include in the Development Letter if the Applicant Requested Substitution and It Is Granted
Use the following language if the applicant requested substitution and it is granted by VA:
As mentioned in a previous letter, we have granted the request for substitution.  The request for substitution allows you to submit additional evidence in support of the pending [insert claim or appeal] to determine your entitlement to [insert the word “additional” if some accrued benefits have been paid] accrued benefits.

XI.ii.3.C.4.g.  Language to Include in the Development Letter in the How Soon Should You Send What We Need Section
Use the table below to determine the appropriate language to include in the How Soon Should You Send What We Need section in the first development letter:
If the letter is …
Then insert the following language in the How Soon Should You Send What We Need section …
a new Section 5103 notice
We strongly encourage you to send any information or evidence as soon as you can.  As a substitute claimant for the deceased claimant’s claim, you must complete any action required within the time period remaining at the time of the payee’s death.  If we do not hear from you, we may make a decision on your claim after 30 days.  However, you have up to one year from [insert the date of the Section 5103 notice] to submit the information and evidence necessary to support your claim.  If we decide your claim before one year from the date of this letter, you will still have the remainder of the one-year period to submit a supplemental claim along with the additional information or evidence necessary to support your claim.
reissuing the Section 5103 notice when the notice to the original claimant had not yet expired
We strongly encourage you to send any information or evidence as soon as you can.  As a substitute claimant for the deceased claimant’s claim, you must complete any action required within the time period remaining at the time of the payee’s death.  If we do not hear from you, we may make a decision on your claim after [insert number of days remaining on the original claimant’s Section 5103 notice] days.  However, you have up to one year from [insert the number of days remaining in the 1 year time period after the date of the original Section 5103 notice] to submit the information and evidence necessary to support your claim.

XI.ii.3.C.4.h.  Substitution Waiver Language to Include in All Development Letters if Not Previously Included
Use the following substitution waiver language if not previously included:
The right to substitute may be waived by submitting the request in writing.  We have enclosed VA Form 21-10210, Lay/Witness Statement, for this purpose.  If the right to substitute is waived, VA will still render a decision on the accrued claim, if applicable, but based only on the evidence contained in the claims folder at the time of the original claimant’s death.

5.  Notification Requirements for Substitution Grants and Denials

Introduction

Change Date
 February 7, 2022

XI.ii.3.C.5.a.  Language to Use When Denying the Request to Substitute
When denying a request to substitute be sure to provide the specific reason for denial in the notification letter.
The letter should also include any of the three findings potentially relevant to a denial explained in M21-1, Part XI, Subpart ii, 3.C.5.b.
Reference:  For more information on what the substitution denial notification letter should include, see Substitution Denial Letter Template.

XI.ii.3.C.5.b.  Discussion of Findings When Denying the Request to Substitute
There are only three findings potentially relevant to a denial of a request to substitute.  The three potentially relevant findings are whether
  • there was a claim, request for decision review, or appeal pending at the time of the deceased claimant’s death
  • evidence of eligibility has been received, or
  • the request was submitted timely.
 Therefore, any findings listed on a decision to deny the request to substitute should be limited to these three findings.
Note:  38 CFR 3.1010 is the applicable regulation in this case.

XI.ii.3.C.5.c.  Right to Appeal the Request to Substitute Decision
38 CFR 3.1010(e)(1) states, the agency of original jurisdiction will provide written notification of the granting or denial of a request to substitute to the person who filed the request, together with notice in accordance with 38 CFR 3.103(b)(1).
38 CFR 3.1010(e)(2) states that, the denial of a request to substitute may be appealed to the Board of Veterans’ Appeals pursuant to 38 U.S.C. 7104(a) and 7105.
However, for decisions concerning the right to substitute made on or after February 19, 2019, claimants have the right to appeal to the Board of Veterans’ Appeals or to request a decision review.  Therefore, the decision notice should include VA Form 20-0998, Your Right to Seek Review of Our Decision.
Reference:  For more information on finality of decisions, see M21-1, Part X, Subpart ii, 1.A.

XI.ii.3.C.5.d.  Language to Use When Granting the Request to Substitute
See the Substitution Grant Letter Template for language to include in the notification letter when granting a substitution request.

XI.ii.3.C.5.e.  Language to Use When Granting Substitution and an HLR Was Pending
Use the table below to determine the appropriate language to include in the substitution decision notice when granting substitution and there was a pending HLR at the time of the original claimant’s death.
If the applicant …
Then insert the following language …
did not specifically request substitution
VA has received your claim for accrued benefits and accepted your claim as a request for substitution for the purposes of processing [insert original claimant’s name] higher-level review pending at the time of death.  Additional evidence cannot be considered in a higher-level review decision.  However, any additional evidence submitted will remain in the evidentiary record and be considered upon timely receipt of supplemental claim or appeal to the Board of Veterans’ Appeals after the higher-level review has been processed or withdrawn.  We have granted the request for substitution.
requested substitution and it is granted upon first review by VA
We have granted the request for substitution.  [insert original claimant’s name] had a higher-level review claim pending at the time of death.  Additional evidence cannot be considered in a higher-level review decision.  However, any additional evidence submitted will remain in the evidentiary record and be considered upon timely receipt of supplemental claim or appeal to the Board of Veterans’ Appeals after the higher-level review has been processed or withdrawn. 
Reference:  For more information on procedures regarding when substitution can be granted if an HLR was decided before Veteran’s death and the time period has not expired, see

6.  Updating Legacy Appeals After a Grant of Substitution

Change Date
February 19, 2019

XI.ii.3.C.6.a.  Updating the VACOLS Record for Legacy Appeals
Upon the grant of a request of substitution, update the Veterans Appeals Control and Locator System (VACOLS) record if the original claimant had a pending
  • legacy notice of disagreement (NOD), or
  • legacy appeal.
Note:  A substitute claimant may also file a legacy NOD following notice of the deceased claimant’s claim that was rendered prior to February 19, 2019.  In these cases, enter the legacy NOD as a substitute claimant.  For decisions made on or after February 19, 2019, substitute claimants may pursue a decision review option.
References:  For more information on