Introduction 5 402. 02 Resource Limit 5

402.04 Resources vs. Income

It is important to distinguish between resources and income to know which rules to use for any given month. An item is not subject to both income and resource rules in the same month.

Items received in cash or in-kind during a month are evaluated under the income rules.

Items evaluated under the resource rules include any income retained for use in the month after it is received and all other items not defined as income.

If an individual sells, exchanges, or replaces a resource, what he/she receives in return is a resource that has been converted from one type of resource to another.

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  A lot with equity value of $5,000 is sold, and the money is deposited into a money market account.
  
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  A life insurance policy is cashed in, and the proceeds are used to purchase a pre-need burial contract.
  
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  An individual sells a piece of property for $25,000. The $25,000 is a resource.
  

402.05 Strict Resource Policy

(Rev.08/01/07)

In the strict policy SSI programs, exclusions or exclusion amounts that are more restrictive are used. Some of the most commonly encountered resources and the general policy regarding each are listed below. Information that is more specific to each is given later in this chapter.

Strict policies include the following:

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  Eligibility is based on the individual’s countable resources as of the first moment of the first day of the month.
  
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  One automobile is not automatically excluded regardless of value. (Refer to MPPM 402.17)
  
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  The value of life estate and remainder interest in real property is a countable resource.
  
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  The cash value of life insurance is excluded, if the combined face value of all policies is $1,500 or less. The combined face value of these excluded policies is used as an offset in determining a burial fund exclusion.
  

402.06 First-of-the-Month (FOM) Rule for Making Resource Determinations

(Eff.10/01/05)

In all programs using strict SSI policy, all resource determinations are made as of the first moment of a calendar month. Any increase or decrease in the value of resources is considered as of the first moment of the month following the month the change occurred.

Example #1: Tom Craft applies for assistance on March 30. His only resource is 20 shares of XYZ stock that were worth $800 on the date he applied. On April 30, the value increased to $1,000. His countable resource amount for April is $800 (the value on April 1). The countable value for May is $1,000. Example #2: Rhonda Lee applies for assistance on April 5. On April 1, her resources were $500 in checking and $400 in savings. Her son gave her a CD worth $1,800 on April 25. Her savings balance increased to $450 on April 30, but her checking balance dropped to $150. Those balances remained the same until May 10. Her countable resources for April are $900 ($500 + $400). For May, they are $2,400 ($1,800 + $450 + $150). The CD is not considered until May since it was acquired in the middle of the month. Example #3: At the time of her June 10 application for assistance, Dolly McGuire had a checking account ($400 on June 1), a life insurance policy (FV $2,000; CV $250 on June 1), and a car valued at $2,000. She sold her car on June 25 for $1,800 using it to open a savings account. On July 1, her savings balance was the same, as was the value of her life insurance. Her checking account balance was $100. Her countable resources for June were $650 ($400 + $250). For July, they were $2,150 ($1,800 + $100 + $250).

402.07 Whose Resources to Count

(Eff.10/01/05)

POMS SI 01110.530

When eligibility is determined or re-determined, the resources of the following must be considered:

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  Applicant/beneficiary
  
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  Spouse (legal or common law) of the applicant/beneficiary
  
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    If they live in the same household
    
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    Even if they are not applying or are ineligible (Exception: Institutionalized individuals discussed in MPPM Chapter 304.)
    
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  Parent(s) of an applicant/beneficiary who is a child under age 18 if living in the same household.
  

402.08 Unknown Assets

(Eff.10/01/05)

POMS SI 01110.117

An individual may be unaware of his/her ownership of an asset. The asset is not a resource for the period during which the individual is unaware of his/her ownership.
Once discovered, the value, including any monies accumulated on it through the month of discovery, must be treated as follows:

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  Month of discovery – treated as income
  
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  Month after the month of discovery – any remaining value is a resource
  

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