009.09(F) DEPRIVATION OF RESOURCES.

Any action taken by the individual, or any other person or entity, that reduces or eliminates the individual’s, or spouse’s, recorded ownership or control of the asset for less than fair market value is a deprivation of resources. This includes: (1) Recorded transfer of ownership of real property; (2) Not receiving the spousal share of an augmented estate; (3) Purchase of a life estate in another individual’s home without meeting the 12-month requirement to reside there; (4) Promissory notes, loans, mortgages, and contract sales for less than fair market value and not enforced; (5) Purchase of an irrevocable, non-assignable annuity if State Disability Program is not the preferred beneficiary and the annuity is issued on February 8, 2006, or later; (6) Any transfer above the protected spousal reserved amount to a community spouse; and (7) Purchase of any contract or financial instrument, including an endowment or insurance, where the criteria for fair market value are not met. 009.09(F)(i) The criteria for fair market value are not met when: (1) The term of the instrument exceeds the life expectancy of the applicable individual; (2) The instrument does not provide for equal monthly or annual payments commencing immediately during the term of the contract; (3) The instrument does not provide for the recovery of assets in the event of default; or (4) The instrument contains exculpatory or cancellation terms of balance due. 009.09(F)(ii) A service given for free at the time cannot later be claimed as an amount owed. 009.09(F)(iii) When an asset is placed in an annuity on February 8, 2006 or later, the annuity regulations apply. 009.09(F)(iv) Trust regulations may take precedence over deprivation when an asset is placed in a trust. 009.09(F)(v) When real property in which the individual has a life estate is sold, the individual or spouse must receive, as a lump sum, their life estate interest from the net proceeds, or the entire net proceeds invested and the individual who has the life estate receives all the income.