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Chapter: 1600 Assets Program: MSSI, SFP 24

In order to qualify for the exclusion, the individual must replace the excluded home with another excluded home or property within the three month time limit. Otherwise, the proceeds from the sale will be an included asset beginning the month after the three-month period ends, allowing for ten days advance notice of adverse action.

If a home is being replaced due to loss or damage resulting from a disaster or accident, the in- kind replacement (temporary housing or support) is excluded for nine months from the date received.

This policy also applies if the individual applies for benefits after selling a home that would have been excluded as an asset under current policy. In this case the three-month exclusion period begins the day the individual applies. 1640.0543.04 Home Replacement Period (MSSI, SFP) An excluded home that has been sold must be replaced within three months in order for the individual to continue excluding home property as an asset. Replacement occurs when the individual pays for the replacement home or signs a written contract to pay for the home.

The three month requirement starts on the date proceeds from the sale are received and ends three months later on the same day of the month that the proceeds were received. The three- month replacement period cannot be extended.

If the individual has already received proceeds of a home sale before he applies, the replacement period begins on the date of application.

If the replacement is not completed within the three-month limit, all proceeds of the sale are included as assets the day the three-month limit ends and becomes a countable asset the next month. Replacement can be verified by evidence such as a contract, canceled check and bill of sale.

If a replacement home is purchased within the time limit, any proceeds remaining after replacement costs are included as assets starting the month after the three-month period ends, allowing for ten days advance notice of adverse action. Replacement costs include moving expenses and other expenses such as the property taxes needed to complete the replacement. 1640.0543.05 Verification (MSSI, SFP) Verification information is found in passages 1640.0537 and 1640.0542. 1640.0544 Income Producing Property (MSSI, SFP) An individual can exclude the fair market value of any income producing property he owns that is essential to self-support. 1640.0548 Income Producing Property (MSSI, SFP) Any income producing property (including equipment) may be excluded from assets if it annually produces income consistent with its fair market value. The individual's statement that the property produces a reasonable return may be accepted. If the rate of return is questionable, the eligibility specialist must require verification from a knowledgeable source. The following types of income producing property may be excluded:

1. Property that annually produces income consistent with its fair market value, even if used only on a seasonal basis. Such property shall include rental and vacation homes.

2. Property such as farmland, or work related equipment that is essential to the applicant/recipient's employment or self-employment.