Introduction 5 402. 02 Resource Limit 5
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- 402.12 Retirement Funds
- 402.13 Loans, Promissory Notes and Property Agreements
- Non-Bona Fide, Non-Negotiable Agreement
402.11.02 Types of Access(Eff.10/01/05) Resources are accessible through an agent, litigation, or a petition-conservatorship account. Listed below is more information on these three types of access to resources. Access Via an Agent POMS SI 01120.020 An individual is considered to have free access to, and unrestricted use of, property even when he/she can take those actions only through an agent (such as a representative payee or guardian.)
Access Only Via Litigation If there is a legal restriction, or a bar, to the sale or use of property (such as a co-owner legally blocks the sale of jointly-owned property), an individual is not required to undertake litigation in order to accomplish the sale or access. The property is not a resource under such circumstances in a month if a legal bar exists as of the first moment of that month.
Access Via Petition-Conservatorship Account POMS SI 01140.215 Petitioning a court is different from undergoing litigation. Seeking court approval is not a legal restriction against use. Although the individual does not have access to the asset, the conservator does. Therefore, it is available for the individual's support and maintenance and is, therefore, that individual's resource. This is true despite the fact that the individual or his/her agent is required to petition the court to withdraw funds for the individual's support and maintenance. Table of Contents
POMS SI 01120.210 Retirement funds are annuities or work-related plans that are designed to provide income when work ends. Listed below are some examples:
Pensions, disability, or retirement plans administered by an employer or union 401K IRA Keogh or Roth plans Some profit sharing plans Table of Contents
Table of Contents 402.13 Loans, Promissory Notes and Property Agreements(Eff.10/01/05) POMS SI 01120.220 This section involves the principal amounts of these items. The interest paid is ALWAYS considered unearned income. All promissory notes must be sent to the Bureau of Eligibility Administration for evaluation and approval.
May be written or oral Oral agreement is bona fide if it is legally binding and includes: Borrower’s acknowledgement of his/her obligation to repay A schedule and plan for repayment Borrower’s intent to repay from income or property Negotiable Agreement—legal title to the agreement or the amount of the agreement can be transferred to another party Loan—One party gives money to another party who promises to repay it in full. It may or may not include paying interest. It must be written (promissory note) and enforceable under State law. Promissory Note—Written agreement where one person promises to pay another party a specific amount at a specific time. It can be repayment of money or a payment for services or goods. Property Agreement—a piece of property is used to secure payment of a debt or performance of services. Other names for property agreements include: Mortgage Land contract Contract for deed A person holding a contract for the sale of real estate owns two things until the agreement is settled: (1) the real estate and (2) the value of the agreement. (Note: The real estate is not a resource because it cannot be sold.) A contract must be evaluated to determine if it is a resource and, if so, how it should be treated. If the contract is a non-bona fide agreement, goods or money may be “income” when received or “a resource” if retained. In a bona fide agreement, the contract to pay cannot be “income” but may be “a resource” if retained.
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