This may be a question you need to speak with an Elder Law Attorney about due to the legal issue; however see the listing below to help you arrive at what her countable income is.
I hope this helps.
The VA suggests that its adjudicators use a certain amount of personal
judgment on this issue. But the bottom line is: does it realistically appear
that the veteran or surviving spouse may outlive their assets? If so, they
are likely eligible.
Do NOT count their residence or vehicle when estimating net worth.
Do NOT count a life insurance policy (because the policy holder must be
deceased in order to benefit from it).
DO count CDs, annuities, stocks, bonds, savings, checking, IRAs, Keogh, etc.
DO count any assets owned by the spouse as well.
As a rule of thumb, assets should not exceed $80,000. That amount drops
depending on the age of claimant.
List below the estimated ANNUAL income of the veteran or surviving spouse:
Estimate total income (If married include spousal income): ______
All income must be included. This includes social security, pension,
interest income, dividends, income from rental property, etc.
If the veteran is married, then any spousal income must also be included.
List all unreimbursed, recurring health care expenses:
Assisted Living costs (per month): _________________
Nursing Home costs (per month):________________
Home Care service (per month):_______________
Health Insurance premium (per month):_______________
Medicare premium (per month):_________________
Regular (unreimbursed) prescriptions
(per month & verifiable through a pharmacy print-out): _____________
TOTAL Expenses per month: __________
(multiply x 12 to get total annual expenses)
Subtract your total annual health care expenses from your total annual
income and write the amount here: _____________. This is your "countable"