5000 Resources

5632 Reserved

5633 Reserved

5634 Annuities for TANF, Child Care, and Food Assistance - Each annuity must be evaluated to determine the terms of the contract. Those terms will determine if the annuity is an available resource and the potential fair market value of the annuity. Any annuity has the potential to be counted as a resource or income.

5634.1 Evaluation of the Contract Terms- The specific terms of the annuity contract shall determine whether the annuity is treated as a resource or as income.

Retirement Annuities - Retirement Annuities (e.g., Civil Service Annuities and Railroad Retirement Annuities) are exempt as a resource, but the income received is countable unearned income. A retirement annuity is one which meets the qualification tests of the Internal Revenue Code for tax purposes. A qualifying retirement annuity shall be one which receives favorable tax treatment and is non-transferrable. These annuities are also known as qualifying annuities.

Revocable Annuities - If the terms of the contract allow for the annuity to be surrendered or cashed-in with the issuing company, the annuity is considered revocable. An annuity which is in the accumulation phase is presumed to be revocable. The fair market value of a revocable annuity is considered an available resource because the contract can be cancelled in return for a cash payment. The fair market value is the cash value.

Irrevocable Annuities - If the terms of the contract do not allow the annuity to be surrendered or cashed-in with the issuing company, it is considered irrevocable. An annuity which is in the payout phase is presumed to be irrevocable. The payments received from an irrevocable annuity are counted as unearned income per 6220(2) and are exempt as a resource.