1 Tex. Admin. Code § 358.350 - Life Estates and Remainder Interest
The Texas Health and Human Services Commission (HHSC) counts both a life estate and a remainder interest in property as resources, except as described in paragraph (3) of this section.
(1) Life estates. A life estate provides a
person, for the person's lifetime, certain rights in a property, while
transferring ownership of the property to another person. The duration of a
life estate is measured by the lifetime of the owner of the life estate, or by
the occurrence of some event. The contract establishing a life estate, however,
may restrict one or more rights of the owner of the life estate. The owner of a
life estate does not have fee simple title to the property nor the right to
sell the entire property. In most situations, the owner of a life estate has
the right to:
(A) possess the
property;
(B) use the
property;
(C) get profits from the
property; and
(D) sell his or her
life estate interest.
(2) Remainder interest. A remainder interest,
which is created when a life estate is established, gives a person owning a
remainder interest the right to ownership of the property upon the death of the
owner of the life estate. A person owning a remainder interest in the property
has the right to sell his or her remainder interest unless the person is
prohibited from doing so by a legal restriction.
(3) Exclusion for life estates and remainder
interests. Life estates and remainder interests are not counted as resources
if:
(A) the property is the person's home and
can be excluded under §358.348 of this division (relating to Exclusion of
a Home);
(B) a contract restriction
prevents the person from disposing of the person's interest;
(C) the property is producing income and may
be excluded under
20 C.F.R.
416.1220,
20
C.F.R. 416.1222, and
20
C.F.R. 416.1224; or
(D) the property is placed for sale and the
person is in an institutional setting.
(4) Determination of value. If a person has a
life estate or remainder interest that is not excludable under paragraph (3) of
this section, HHSC determines the value of the resource according to the age of
the owner of the life estate and the equity value of the property. The person
has the right to rebut HHSC's determination of the value of the resource. To do
so, the person must present a statement from a knowledgeable source.
(5) A purchase of a life estate before April
1, 2006, is not considered a transfer of assets, unless the purchase price of
the life estate exceeds the fair market value (FMV) of the life estate. If the
purchase price of the life estate exceeds the FMV of the life estate, the
transfer-of-assets provisions in Division 4 of this subchapter (relating to
Transfer of Assets) apply.
(6) A
purchase of a life estate on or after April 1, 2006, is a transfer of assets,
subject to the transfer-of-assets provisions in Division 4 of this subchapter,
unless the person purchasing a life estate in another person's home resides in
the home and continues to reside in the home for at least one year after the
date of purchase.
Notes
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