3200, Resource Eligibility Criteria

3210 Resource Limits

Revision 17-1; Effective March 15, 2017

40 Texas Administrative Code §48.2922. An individual applicant or client is not eligible for CCSE services if the value of nonexempt resources owned by him exceeds $5,000. A couple is not eligible for CCSE services if the value of nonexempt resources they own exceeds $6,000.

The individual limit applies to individuals who are single, even if they live with relatives. The individual limit also applies to individuals whose spouses live in different households. The couple limit applies to married individuals who live in the same household, even if the spouses are ineligible.

Include in the individual's resources those resources the individual owns even if the resources are managed and controlled by someone else acting on the individual's behalf. Also include funds that are not in the individual's name if those funds clearly belong to the individual and are available for use. Determine ownership based on the individual's statement unless contradictory evidence from another source exists.

3220 Types of Resources

Revision 17-1; Effective March 15, 2017

40 Texas Administrative Code §48.2923. In determining eligibility for CCSE services, the department considers the following to be resources:

(1) Liquid resources including cash on hand, CDs, checking or savings accounts, money market funds, revocable trust funds, saving certificates, stocks, or bonds. Liquid resources also include the individual's or couple's portion of money in a checking or savings account or a money market fund held jointly with another person.

(A) Jointly held liquid resources are the resources of the applicant/client if he has unrestricted access to the funds, regardless of the source. The applicant/client may move his portion of jointly held funds in a joint account to a new account. Although the new account may be jointly owned, all funds in the new account are considered to be his.
(B) Money received as a nonrecurring lump sum payment is not considered a resource until 30 days from the date of receipt. Lump sum payments include, but are not limited to, income tax refunds; earned income tax credits or rebates; one-time bonuses from mineral rights; retroactive lump sum Social Security, SSI, or railroad retirement benefits; lump sum insurance settlements; one time gifts, awards, or prizes; and refunds from rental or utility deposits. The applicant/client is responsible for reporting the receipt of a lump sum payment.

(2) Nonliquid resources including nonexempt licensed or unlicensed vehicles; buildings and land not designated as homestead that are not producing income, or are producing income less than 6% of the equity value; and any other property not specifically excluded.

Evaluate nonliquid resources according to the equity value. Equity value is the market value of the resource minus any recorded encumbrances.

Money received from the sale of a countable or excluded resource, other than a homestead, is not counted as a resource until the first day of the month following a full month after it was sold. Example: The resource is sold on June 15; proceeds are not counted until Aug. 1.

Annuities

A revocable annuity is a countable resource. If an individual has an annuity, the case worker must review the contract or agreement terms to determine if the principal is an available resource. Refer the annuity document to the regional attorney if there is a question as to whether or not the annuity is revocable.

Irrevocable annuities are not countable resources for Community Care for Aged and Disabled individuals. However, the purchase of an annuity may affect the individual's eligibility for institutional care or waiver services. If the individual is concerned about the effect the annuity may have on future eligibility for services, refer the individual to consult with a Medicaid for the Elderly and People with Disabilities specialist.

Guardianships and Power of Attorney

If the individual is a guardian for a person other than his spouse, do not include in his resources any separately identifiable funds belonging to the other person but accessible to the individual as that person's guardian.

A person who has a financial power of attorney for another is acting solely as a fiduciary agent. The fiduciary agent acts in a financial capacity, whether formal or informal, regardless of title (for example, representative payee, guardian or conservator); therefore, assets belonging to the other individual should not be considered as part of the individual's available assets.

Assets held by a fiduciary agent for an individual are considered available to the individual, unless otherwise excludable.

3230 Resource Exclusions

Revision 17-8; Effective September 1, 2017

In determining eligibility for CCSE services, the department does not consider the following to be resources. They are considered to be excluded for eligibility purposes. Any item not listed as an exclusion is considered a resource.

(1) Homestead — Any structure used by the client as a residence, including other buildings and contiguous land. Mobile homes, houseboats, and motor homes are considered structures. Vacant property is not a homestead. Contiguous land means land adjacent to the home, including any land separated only by roads, rivers, and streams. Land is contiguous as long as it is not separated by property owned by another person. The homestead is excluded as a resource regardless of its location, even if the client no longer lives there (unless he has purchased another residence). If he owns two houses, his homestead is the property that he uses as a residence. Only one homestead may be excluded for each client or couple.
If the individual lives in a house, but also has a mobile home, houseboat or motor home on the property, these are all excluded as part of the homestead.

(2) Personal property — Household goods and personal effects.
(3) Property essential to employment — Tools and equipment required for employment or self-employment.
(4) Prepaid burials — Prepaid burial arrangements, burial insurance, and burial plots.
(5) The cash surrender value of all life insurance.
(6) Vehicles — One passenger car or other vehicle, such as a van or truck, used for transportation; or one unlicensed vehicle.

(A) A second vehicle may be excluded if it is:

(I) specially equipped to enable a person with a disability to drive, or
(II) essential to the employment or self-employment of the family.

(B) Any additional vehicles, licensed or unlicensed, are considered resources.

An inoperable junk vehicle can be assigned a value of $100, if the individual's resources are less than:

  • $4,900 for a single person, or
  • $5,900 for a couple.

The case worker must verify the value of an inoperable vehicle when the individual's resources are within $100 of the CCSE resource limit ($5,000 for a single person or $6,000 for a couple).

(7) Income-producing property — Property that annually produces net income equal to or greater than 6% of the property's equity value. The equity value is the current market value of the property less any recorded encumbrances. (See Section 3231, Rate of Return on Income-Producing Property.)
(8) Installment contracts from mortgages, notes, or loans — The value of installment contracts for the sale of land, other property, or repayment of loans, if the contract or agreement is producing income according to the fair market value at the time of the agreement. An installment is a mortgage or similar contract in which the buyer promises to pay a fixed amount over a period of time until the principal of the note is paid. Even though the seller retains legal title, the property is not considered a countable resource as long as the buyer is fulfilling the contractual obligation. The payment is considered income.
(9) Disaster assistance — Government payments granted for the rebuilding of homes destroyed or damaged in a disaster.

Reverse mortgages are treated as loans. The money received is not considered to be income. However, it is a resource the month after receipt.

(10) Energy assistance — Payments or allowances for energy assistance made under any federal, state, or local law.
(11) Supplemental Nutrition Assistance Program (SNAP) allotments — The value of SNAP allotments and USDA-donated foods.
(12) Inaccessible resources — The cash value of resources that are inaccessible to the client. Examples are irrevocable trust funds, property in probate, and pension funds. Real property that the client or family is making a good faith effort to sell is exempt. The client or family must ask a fair price for the property, according to its current market value. Property is also exempt if it is jointly owned and the other co-owners refuse to sell.

  • If jointly owned property is not excluded, the market value of the individual's share of the property is countable. However, if the value will not affect eligibility, enter the full value of undivided property and document that the property is jointly owned.
  • An IRA should be treated as a pension fund, and therefore not considered as a resource for eligibility determination.

(13) Mineral rights — The value of mineral rights.
(14) Life estates and remainder interests — A life estate is the right an individual has to property during the individual's lifetime. A remainder interest is the right of ownership to the property when the life estate holder dies.
(15) Replacement value of excluded resources — The replacement value of an excluded resource if it is lost, damaged, or stolen. The cash received from an insurance company for replacing the resource is not considered for three months if the resource is personal property or six months if it is real property. Any cash not spent within the specified period is considered a resource.
(16) Monthly gross income — All income received monthly. Monthly gross income is counted as income in the month received and excluded as a resource in that month.

  • Do not deduct income from resources unless the countable resources exceed $5,000 ($6,000 for a couple).
  • If resources exceed the $5,000/$6,000 limit, determine whether the monthly income is actually included in the checking or savings account or cash on hand.
  • If cash on hand is money remaining from the current month's income, it may be deducted unless this would duplicate deduction of the same money as a checking or savings account deposit.
  • If resources exceed the $5,000/$6,000 limit, deduct the amount of income the individual may have received at the end of the month intended for the next month. Example: Next month's Social Security check arrives early (the last day(s) of the month) and is deposited into the individual's checking or savings account.
  • If income is deducted and the individual receives Veterans Affairs (VA) aid-and-attendance or homebound benefits, deduct the full amount of VA payment even though aid-and-attendance is excluded from income.

(17) Sale of a homestead — Proceeds from the sale of a homestead up to six months after they become available to the seller. The six months gives the client time to acquire another homestead. If he does so, any balance from the original sale must be considered as an available resource. If, before the end of the six-month period, the client declares that he has no intention of acquiring another homestead, the proceeds from the sale must be counted as an available resource.
(18) Agent Orange Settlement Payments — Payments from the Agent Orange Settlement Fund or any other fund established in settlement of the Agent Orange product liability litigation.
(19) Radiation exposure compensation — Payments received under the Radiation Exposure Compensation Act (P.L. 101-246).
(20) Funds from the Transition to Life in the Community Program.
(21) Livestock.
(22) Earned income tax credit (EITC) refunds from the Internal Revenue Service.

3231 Rate of Return on Income-Producing Property

Revision 17-1; Effective March 15, 2017

To determine whether the property is producing enough income to be excluded as a resource:

Step Procedure
1 Determine the current market value, or the amount the property would bring on the open market. The current market value may be based on an estimate by a knowledgeable source such as a realtor or bank official.
2 Determine the total amount owed on the property (encumbrances) by viewing a copy of the loan agreement, purchase contract, or contract with the creditor.
3 Calculate the equity value by subtracting the encumbrances from the current market value.
4 Multiply the equity value by 6% to determine the required gross yearly revenue that must be produced to exempt the property.
5 Calculate the net yearly income the property produces from rents, leases, etc. by subtracting from the gross yearly income any expenses such as taxes, insurance, costs of repairs and maintenance, and interest on the property's mortgage. (Expenses for capital improvement and depreciation are not deductible.)
6 Compare the required gross yearly revenue calculated in step 4 (yearly income that must be produced) with the net yearly income from step 5 (actual yearly income produced) to determine whether the net income equals or exceeds 6% of the equity value. If the property is not producing income equal to or greater than 6% of the equity value, consider the equity value of the property a resource.