After excluding the above allowable transfers and exceptions, apply transfer policy to all remaining transfers in the lookback period. Do not apply a sanction for transfers prior to 11/1/02. Some transfers have special rules based on the type of resource transferred. Apply the following rules:
A. Date of Transfer for Real Property
The date of transfer for real property is the day the deed is signed by the grantor, delivered, and accepted by the grantee. Unless fraud is suspected, it is presumed this is the date recorded on the front of the deed. The deed does not have to be notarized or registered in order to be a valid title transfer. It must be signed by the grantor, delivered, and accepted by the grantee. However, a deed of gift must be registered within two years of the date the deed is signed to remain valid.
B. Date of Transfer for Liquid Resources
The date of transfer for liquid resources is the date the owner gives or mails the cash, check, or other liquid resource to another person. This is the date the a/r no longer has access to or control of the resource.
Example: A/R withdraws writes and mails a check to his son on August 28 but it does not clear the bank account until September 12. The date of transfer is August 28.
C. Tenancy-in-Common Property Interest
1. Evaluate for transfer of resources when the a/r changes ownership interest in property from sole ownership or tenancy-by-the-entirety to tenancy-in-common interest.
a. The date of transfer is the date the ownership interest is changed to tenancy-in-common.
b. The uncompensated value is the equity value of the a/r’s percentage of the property that is changed to tenancy-in-common, less any compensation received.
Example: The a/r owns property with an equity value of $65,000. He gives his brother a 1% share (worth $650) and receives no compensation. The uncompensated value is the value of the 1% share changed to tenancy-in-common, $650.
2. If the a/r transfers an existing tenancy-in-common interest in property, the value transferred is the equity in his tenancy-in-common share. Refer to SA-3200, Resources, for instructions on determining the equity in the tenancy-in-common share.
Example: The a/r owns property with his three brothers, and each brother owns 25%. The tax value of the property is $100,000 and there are no liens. The value of the a/r’s share is $25,000. He transfers his share to his sister. The uncompensated value of the transfer is $25,000.
D. Life Estate
1. Evaluate for transfer of resources when the a/r transfers real property and retains a life estate.
a. The date of transfer is the date the remainder interest is granted.
b. The uncompensated value is the equity value of the remainder interest granted, less compensation received. Refer to SA-3200, Resources, for instructions on determining the equity in a remainder interest.
2. Evaluate for transfer of resources when the a/r transfers a life estate in real property.
a. The date of transfer is the date of the deed or agreement transferring ownership of the life estate.
b. The uncompensated value is the equity value of the life estate less any compensation received. Refer to SA-3200, Resources, for instructions on determining the equity value of a life estate. If the a/r has provided rebuttal evidence to establish that the life estate has no market value, the uncompensated value of the transfer is $0.
E. Joint Ownership of Liquid Resources
1. If the a/r has access to a joint bank account without the consent of the other account holder, the full amount of the account is a countable resource. Transfer of a countable resources is subject to a sanction if transferred by the a/r or by the other account owner (unless it is transferred by the a/r to the spouse).
NOTE: If it appears the a/r has been defrauded, refer to V.J. for referral to Adult Services.
2. Determine if a resulting trust exists. If a resulting trust is verified, there is no sanctionable transfer.
3. Determine the ownership of funds to determine if there has been a non-allowable transfer of resources. If both owners have deposited money into an account and both have equal access, either owner may spend the funds without a sanction period.
Example: Mr. Durham and his brother Mr. Greene live together and have had a joint bank account for a number of years. Both deposit their Social Security income into the account and they pay their shared household expenses from the account. The account balance is about $5,000. Mr. Durham applies for SA and the full balance of the account is a countable resource. To reduce resources, Mr. Durham uses money from the account to pay off some outstanding medical bills. Mr. Greene uses money from the account to pay off a credit card balance and to repair his car. This is not a transfer because the funds belong to both account holders and the money was spent down to meet their needs.
4. Evaluate for transfer of resources when the a/r takes any action that eliminates his
ownership or reduces his control of a liquid resource. Examples include when the a/r adds another individual to a bank account or certificate of deposit.
5. The date of transfer depends on the action:
a. The date of transfer for an "or" account is the date the resource is actually reduced.
Example: The a/r added his niece's name to his $30,000 savings account in January so either party could access the account independently. This is an "OR" account. (For SA purposes, the entire $30,000 would still be considered available to the a/r.) In April, the niece withdraws the $30,000 from the joint account and puts it into her own account. The date of transfer is the date the niece actually withdrew the funds. However, if the niece withdraws the money and uses it on behalf of the a/r, there is no transfer.
b. The date of transfer for an "and" account is the date the a/r reduces his control of the resource.
Example: The same situation as above, but the account is changed to an "AND" account. An "and" account requires the signature of both parties to access. The date of transfer is the date the niece's name was added to the account because that is the day the a/r reduced his control of the resource.
F. Transfers Involving Countable Trusts
Any time you learn the a/r created a trust or is the beneficiary of a trust, report it to DMA, Third Party Recovery Section. The telephone number is 919-647-8100.
1. Except for the specific trusts described in VI., evaluate trusts created by the a/r with his funds as either:
a. An available resource to the a/r, or
b. A transfer of resource.
2. Refer to SA-3200, Resources, to determine what portion of the trust is an available resource to the a/r. The amount that is unavailable to the a/r is subject to a transfer sanction.
3. Revocable Trust
a. The date of transfer for a revocable trust is the date a disbursement from the trust is made to someone other than the a/r.
b. The uncompensated value of the transfer is the actual amount paid to an individual other than a/r.
4. Irrevocable Trusts
If the a/r uses his own funds to establish an irrevocable trust, a portion of that trust may be countable. Refer to SA-3200, Resources to determine if an irrevocable trust is countable. The portion of the trust that is not countable is subject to a transfer sanction.
a. The date of transfer is the date the trust is established.
b. The uncompensated value is the portion of the trust that was made unavailable to the a/r on the date the trust is established. Do not subtract any payments made from the trust after the trust was established.
c. Treat additions to existing trusts as a new transfer based on the date of the addition. Additions include undistributed interest earned on the trust principal.
G. Stream of Income Or Income Diversionary Trusts
1. A stream of income is income received on regular basis such as a pension or rental income.
2. A diversionary trust is one in which the a/r diverts regular income into a trust. Refer to SA-3200, Resources, for rules regarding treatment of diversionary trusts.
3. When a stream of income is transferred or diverted, treat each payment as a separate transfer.
Evaluate for transfer of resources when an a/r gives cash or other resources to a family member, relative, or friend for care or services that were provided for free in the past. Unless there was a written agreement for compensation at the time the care or service was received, the transfer is uncompensated.
I. Transfer of Income Producing Property, Other than Income Producing Home sites
If non-home site income producing property is transferred, evaluate for transfer of resources.
The sanction is based on the full amount of the uncompensated value, regardless of whether the property met the 6% test. Do not deduct $6,000.
For questions or clarification on any of the policy contained in these manuals, please contact your local county office.