415.25 When a Penalty Period for Transferring Assets Is Not Assessed (AAM)

415.25 When a Penalty Period for Transferring Assets Is Not Assessed (AAM)

SR 98-09 Dated 02/98 Previous Policy

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A penalty is not assessed for transferring assets for less than fair market value when:

. The individual verifies in writing to the Division of Family Assistance (DFA) their intention and attempt to dispose of the asset either at fair market value, or for other valuable consideration, and a description of the circumstances that caused the transfer for less than fair market value supported by written evidence for the value at which the asset was disposed.

. The individual provides satisfactory evidence to DFA that assets were transferred exclusively for a purpose other than to qualify for medical assistance. The individual also provides evidence for the purpose for which the asset was transferred as well as the reason it was necessary to transfer the asset in question for less than fair market value. Assurance that the individual was not considering medical assistance when the asset was disposed of is not sufficient.

. The assets transferred for less than fair market value have been returned to the individual. When a penalty has been assessed and payment for services denied, a return of all assets or the fair market equivalent requires a retroactive adjustment back to the beginning of the penalty period if the individual met all other eligibility criteria.

If only a part of the asset or its equivalent value has been returned, the penalty period is adjusted according to the value of the assets returned. That is, if only half of the assets are returned, reduce the penalty period by one half.