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Title 8: Medicaid Page 115 Iowa Department of Health and Human Services Employees’ Manual Chapter D: Resources Specific Non-MAGI-Related Resources September 13, 2024 Life Estates or Remainderman Interest Life Estates or Remainderman Interest (Cont.) To determine the value of the remainder interest when the client is the remainderman of a life estate:

1. Determine the fair market value the entire underlying property (as if it was not divided into a life estate and a remainder interest).

2. Find the line on the remainder column corresponding with age of the person whose life controls the life estate (the original holder of the life estate) as of the date for which a value is being determined.

3. Multiply the fair market value by the figure in the remainder column.

If the client maintains that the life estate or remainder interest cannot be sold for the amount determined using the table, the client must present other evidence to support this claim.

You may also use the table for mortality, life estates, and remainder published by the Iowa Department of Revenue at http://www.iowa.gov/tax/forms/60059.pdf. This table may be used as a second source in determining the fair market value of a life estate, along with the table in this chapter.

The client must obtain a statement from a disinterested, knowledgeable third party stating the value of the life estate or remainder interest.

A disinterested third party is someone who is free of bias and self-interest that can determine the value of the property. Use the “prudent person” concept in determining whether the party stating the value of the life estate has anything to gain by making the offer.

A disinterested, knowledgeable source may establish that a life estate or remainder interest has no value if it could not be sold at any price.