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sell the property. They can, however, sell their interest in the property, unless the contract terms restrict the sale (life estate value is excluded if the sale is restricted), and they are entitled to any property income. NOTE: Mineral or oil rights cannot be sold or leased without the titleholder’s specific consent. Determine life estate value by multiplying the property FMV by the percentage listed on the “Life Estate Interest Table” (ABD 017 Life Estate Interest Table) for the life estate owner’s age. NOTE: When more than one person owns a life estate, base the value on youngest owner’s age. Exclude a life estate if it is the client’s principal place of residence. Life estate value may be excluded if the property is used to produce income, and the annual net income produced is at least 6% of the FMV. This exclusion can apply to a life estate on: · A private residence that the life estate owner or his/her dependents do not occupy, and that does not meet the principal place of residence definition; or · A business property, such as a ranch or commercial property. NOTE: If the life estate property is business property (such as a ranch or other business property) and is excluded as a home, if ANYONE is using the property as part of a business, the life estate owner must be receiving income for the property’s use (rental or lease income). If the life estate owner is not receiving income from the user, evaluate this as an uncompensated transfer of income, per CMA 404-1 Asset Transfers. An uncompensated asset transfer penalty is evaluated when the client purchases a life estate in another person’s home. See CMA 404-1 Asset Transfers. The client can overcome the penalty if they live on the property as their principal place of residence for at least one full year after the purchase date. If the individual lives on the property for one year after purchasing the life estate, the life estate is excluded as the individual’s and/or their spouse’s home. If they move from the property, the property must be generating income consistent with the property’s value to remain excluded. Conditional assistance may be used to exclude a life estate. Because conditional assistance rules consider life estates as personal property, the six-month conditional assistance period applies. LIFE INSURANCE: Exclude term life insurance policies. Family Medically Needy: Exclude the cash and face values of all ordinary (whole life or straight life) life insurance policies. ABD: Exclude the cash and face values only when face value of all insurance policies for an individual is $5000 or less. If the client cashes in or borrows against their whole life insurance policy, the proceeds are countable resources in the month of receipt.