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(2) Determine the sanction period based on the difference between the amount paid and the current market value of the life estate. See IX.C.5. below to determine the uncompensated value.

5. Evaluate the purchase of a life estate in any property that is not the home of another individual. a. Count any amount paid over current market value as a transfer. b. The value of the life estate at the time of purchase must at least equal the amount paid. The uncompensated value is the purchase price minus the value of the life estate at the time of purchase. 6. Ladybird Deed or Life Estate with Powers- The owner of the property creates a life estate for themself, retaining the power to sell the property, with a remainder interest to someone else, e.g., a child.

a. Since the life estate holder retains the power to sell the property, its value as a resource is its full equity value. In this situation, the individual has not transferred anything of value, because they can terminate the life estate at any time and restore full ownership to themselves.

b. Instead, the full value of the asset is considered as a countable resource to the individual (assuming, of course, that it is not an otherwise excluded resource).

D. Remainder Interest in Real Property

1. When the a/b, or the a/b’s spouse obtains a remainder interest in real property, determine if the value of the remainder interest is at least equal to the value of the compensation given in return.

a. Determine if current market value was received for the remainder interest.

b. Multiply the tax value at the time the remainder interest was obtained by the remainder decimal factor that corresponds to the age of the individual whose life determines the length of the life estate. Subtract any encumbrances applicable to the remainder interest. Refer to the Life Estate and Remainder Interest Tables website. The result is the equity value of the transferred remainder interest. c. Compare the equity value of the remainder interest to the value of the compensation received. If the compensation received is less than the equity value of the remainder interest received, this is an uncompensated transfer.

d. The date of transfer is the date the remainder interest is purchased.

2. When the a/b or the a/b’s spouse transfers a remainder interest in real property,