Veterans can lose money by taking advantage of bonus program

By Dan Wells – bio | email
Posted by Trina Edwards - email

(FOX19) - Last year, Ohio residents voted to fund The Veterans Bonus Program, making nearly 200,000 veterans eligible for cash for each month of active service in the military.

The program, although good, has some problems. Veterans can actually lose money if they take advantage of it.

Ohio Issue 1 appeared on the Nov. 2009 ballot, and voters approved it.

The measure authorized the state of Ohio to borrow and spend $200 million dollars to "provide compensation to Ohio veterans of the Persian Gulf, Afghanistan, and Iraq conflicts."

"It's the state of Ohio's tradition to honor our veterans who are returning after every war with a war bonus if you will, and that is what we did through Ohio Issue 1, and so it's Ohio fulfilling that promise," said Congressman Steve Driehaus.

As it stands, veterans are eligible to receive a $100 cash bonus for each month they served, not to exceed a total of $1,000 per veteran.

Those who served in other locations are eligible to receive up to $500.

It sounds simple, but that hasn't been the case for veteran Eric Vogt.

"If you are a veteran and you are receiving a disability pension like a lot of veterans here in Ohio do, if they accept this $1000 bonus within a 12 to 15 month period, the Vets Administration will take the bonus right back from you," said Vogt.

That payment or bonus is considered a gift or income, according to the federal government.

"In my mind this is not income as a gift because it's not taxable," said Vogt. "It should not be considered income from the federal government."

The Ohio Department of Veterans Services says, "pension benefits, are based on the veteran's income so an increase or decrease in the vet's income will force an adjustment or cut in the pension benefit."

"We've gotten a couple of calls to our office," said Driehaus. "So we are looking into it at the federal level to see where those can be exempted and I think that is something that is something that we need to pursuit."

Now, the amount of money that's going to each veteran or being taken away is something some people say is hardly life-changing.

"I live on $1290 a month. That is all I get from the federal government to live on for me and my wife," said Vogt. "I'm not eligible for a lot of county programs because you have to make $980 or less to be eligible, so I'm just stuck in the middle."

"Clearly, it wasn't the intent of the taxpayers in the state of Ohio to have this treated like ordinary income but be treated like a bonus to veterans coming back so we are going to look at that to see what we can do," said Driehaus.

Driehaus introduced a new bill in the house after speaking with FOX19. As it stands, it would ensure that military bonuses are not counted as offsets for benefits like social security and pensions.

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