Disqualifying Transfers 510-05-80

 

Definitions 510-05-80-05

(Revised 10/01 ML #2716)

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(N.D.A.C. Section 75-02-02.1-33.1)

 

For purposes of this section:

  1. Assets or income an individual disposes of means assets or income to which the individual is entitled, or would be entitled if action had not been taken to avoid receiving the asset or income. Examples of actions which would cause assets or income not to be received are:

  1. Irrevocably waiving pension income;
  2. Waiving an inheritance; or
  3. Not accepting or accessing injury settlements.

  1. Market value means:

  1. In the case of a liquid asset such as cash, bank deposits, stocks, and commodities, one hundred percent of apparent market value;
  2. In the case of real or personal property:
  1. If transferred to someone who does not have a confidential relationship with the individual, 75% of estimated market value; or
  2. If transferred to someone who has a confidential relationship with the individual, 100% of estimated market value; and
  3. In the case of income, one hundred percent of apparent market value.

  1. "Relative" means child, stepchild, grandchild, parent, stepparent, grandparent, aunt, uncle, niece, nephew, brother, sister, stepbrother, stepsister, half-brother, half-sister, first cousin, or in-law.

  2. "Someone who has a confidential relationship" means an applicant or recipient’s power of attorney, guardian, legal caretaker, trustee, attorney, or accountant, and may include children or others with a close and trusting relationship.

State law prohibits individuals with a confidential relationship from personally benefiting from transactions involving the applicant or recipient’s income or assets. Accordingly, transfers of property from the applicant or recipient to the person with the confidential relationship must be at 100% of apparent or estimated market value. Transfers for less than 100% may be subject to the disqualifying transfer provisions.

  1. "Uncompensated value" means the difference between 100% of apparent or estimated market value as of the date of transfer and the value of any consideration received.

Example: Mr. Brown owns property with an estimated value of $100,000. If Mr. Brown sells the property, he must receive at least $75,000 to avoid a transfer penalty. If he receives less than $75,000, the uncompensated value is the difference between the amount received and $100,000 (100% of estimated market value).

 

When the party that receives the transferred property also assumes any outstanding loan(s) on the property, the amount of the outstanding loan(s) is consideration received.

 

Example: Mr. Green owns property with an estimated value of $80,000. He has a mortgage for $40,000 on the property. If Mr. Green sells the property for $20,000 and the purchaser assumes the mortgage, Mr. Green is actually receiving $60,000 in compensation (which is at least 75% of estimated value) and there is no disqualifying transfer. If the purchaser does not assume the mortgage, the uncompensated value is $60,000 (the difference between $20,000 and the estimated market value of $80,000).

  1. The average cost of nursing facility care is:

     

Year

Daily Rate

Monthly Rate

2003

129.71

3945

2002

127.05

3864

July-Dec 2001

120.08

3652

Jan-June 2001

109.98

3345

2000

104.94

3192

1999

97.68

2971

1998

94.31

2869

1997

89.00

2713

1996

85.00

2562

1995

80.00

2419

1994

74.00

2339

1993

73.00

2216