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Wisconsin Department of Health and Family Services Obsolete Medicaid Eligibility Handbook For the current MEH, see http://www.emhandbooks.wi.gov/meh-ebd/ For the current BC Plus Handbook, see http://www.emhandbooks.wi.gov/bcplus/ |
4.5.8.1 Home/Homestead Property
4.5.8.1.2 Non-Motorized Trailer Homes
4.5.8.1.3 Exempt Home Property
4.5.8.1.4 Sale of Home Property
Real property means land and most things attached to the land, such as buildings and vegetation.
A home is a place of abode and lands used or operated in connection with it. In urban situations the home usually consists of a house and lot. A home can consist of a house and more than one lot. As long as the lots adjoin one another, they are considered part of the home.
Homestead property may have more than one building or house on it. This applies to urban home owners as well as farm families. In farm situations the home consists of the house and buildings together with the total acreage property upon which they are located that is considered a part of the farm. There will be farms where the land is on both sides of a road and considered a part of the home.
Land should be considered part of the home property if it is not completely separated from the home property by land in which neither the individual nor his/her spouse has an ownership interest.
Easements and public rights of way (utility lines, roads, etc.) do not separate other land from the home plot.
If land is completely separated from the home property by land in which neither the individual nor his/her spouse has ownership interest it should not be considered part of the homestead property.
When a MA fiscal group member lives in one unit of a multi-
unit dwelling and owns all of the units, exempt all of the units and the property they are on. Consider the whole multiunit dwelling as the group member's home.
A non-motorized trailer home is considered real property (4.5.8), regardless of whether or not the client owns the land that it is on. Consider the non-motorized trailer home:
Home property (4.5.8.1) if the client currently lives in it or had lived in it before entering an institution, or
If the client owns the land that the non-motorized home is sitting on, consider it and any other buildings on that land as part of the homestead.
Non-home property if the client does not live in it or had not lived in it prior to entering an institution.
If the non-motorized trailer home is listed for sale, it is considered unavailable (4.5.2)
Although home property is an exempt asset under the conditions described in this subsection, there are limits on divesting home property (4.7.2.3.1).
Non-Institutionalized Person. For a person who is not
residing in an institution, the home is exempt as long as the person resides in it, or intends to return to it. There is no time limit for an intended return. The home remains exempt even if the person rents out part of it while s/he continues to reside there.
Institutionalized Person . When a person resides in an institution, the home is exempt if one of the following conditions is met:
His/her spouse or dependent relative resides in the home.
The dependency of the relative may be of any kind, such as financial or medical.
The relative may be father, mother, daughter, son, grandson, granddaughter, in-laws, stepmother, stepfather, stepson, stepdaughter, grandmother, grandfather, aunt, uncle, sister, brother, stepbrother, stepsister, half-sister, half-brother, niece, nephew, or cousin.
The institutionalized person expresses his/her intent to return to the home. If s/he is able to form an intent but unable to express it, determine his/her intent through other available evidence. Other evidence includes:
His/her written statements.
His/her oral statements made before incapacitation. Accept reports of these statements made by family members.
Accept reports of his/her intent made by an authorized representative (IMM, Ch. I, Part A, 18.3.0). If there is no evidence s/he disagrees with the statement, accept the authorized representative's statement.
If s/he appears unable to form an intent but has not been judged incompetent by a court, accept a family member's statement as evidence of his/her intent.
If s/he has been judged incompetent, accept the intent statement of his/her guardian. Use the guardian's intent statement even if it differs from the client’s.
If neither condition #1 nor #2 is met, the property is no longer the principal residence and becomes non-home property.
Money from the sale of real property is an asset. When the property that is sold is a homestead, disregarded the proceeds if they are placed in an escrow account and used to purchase another home within three months.
A life estate allows an individual to gift a home or other possession but retain certain property rights for his/her lifetime. Generally a life estate provides an individual the right to possess and use a gifted property, and to make money from it. The person does not have the title to or the right to sell the property. S/he usually may not pass it on to his/her heirs as an inheritance. S/he also has the right to sell his/her interest in it. S/he is liable for all costs of the property such as taxes and repairs, unless s/he moves off the property or the will (or deed) states otherwise.
When property is conveyed to one person for life (life estate holder) and to another person (the remainder man), both a life estate interest and remainder interest are created. When the life estate holder dies, the remainder man holds full and unconditional title to the property and can dispose of it as s/he wishes ( fee simple ). Life estate values need to be determined for divestment calculation.
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Example: Sidney gifted away his $100,000.00 home to his nephew Frank, but retained a $30,000.00 life estate, the divested amount is $70,000.00. The life estate interest is an unavailable asset when determining Medicaid asset eligibility for Sidney. However, the remainder interest is an available non-exempt asset for Frank, the remainder person, for Medicaid eligibility determinations. |
Determine the value of the remainder interest for the date you are determining Medicaid eligibility. To do this you need to use the age of the life estate holder on the date that you are determining eligibility for the remainder person. Also use the property's FMV as of that same date. Then select the remainder multiplier (the one that corresponds to the age of the life estate holder) from the life estate table and multiply the FMV by that number. Your result should be the value of the property's remainder interest for the remainder person as of the date that you are determining that person's Medicaid eligibility.
To determine the value of a life estate or remainder interest:
In the Life Estate and Remainder Interest Table (8.1.2) find the line for the person's age as of the transaction date.
Multiply the figure on that line in the Life Estate or Remainder column times the fair market value to determine the value of the life estate or remainder interest.
When a life estate holder moves off the property and the property is rented, follow the instructions in 4.1.5.3 for counting the rental income Income is anything you receive in cash or in kind that you can use to meet your needs for food, clothing, and shelter..
If a remainder person sells the property for which a life estate is retained, the life estate holder is not entitled to any of the payments.
However, if the life estate holder gives up his/her life estate to secure the sale of the property, then the life estate holder would be entitled to some portion of the proceeds from the sale of the property. Treat money received as a result of property settlement as an asset (4.5.7.10).
This page last updated in Release Number : 05-01
Release Date: 01/11/05
Effective Date: 01/11/05
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