Revision 14-4; Effective December 1, 2014
If a person is purchasing a replacement home, the proceeds of the sale of the original home are not countable resources for three full months following the month of receipt. For example, if the person received the proceeds on Jan. 13, the exclusion period ends April 30. There are no extensions.
Expenses related to selling the original home and purchasing and occupying the replacement home are deducted from the proceeds. Allowable costs for selling the home include broker fees; commissions; legal fees; mortgage-related fees, such as "points" paid by the seller; inspection and settlement fees; and transfer and other accrued taxes paid by the seller. The person does not have to have paid allowable costs for purchasing and occupying the replacement home by the end of the exclusion period, but the person must have obligated himself to pay them. Allowable costs include down payments; settlement costs; loan processing fees and points; moving expenses; costs of necessary repairs or replacements to the replacement home's existing structure or fixtures, such as furnace, plumbing and built-in appliances; and mortgage payments on the replacement home for periods before occupancy.
Any proceeds in excess of the cost of replacing and occupying the home are countable resources.
If the original home was excluded for intent to return, the replacement home retains that exclusion even if the individual has not physically occupied the new home.
See Section F-3121, Intent to Return Policy.