M E M O R A N D U M

IM-63  05/21/99  FOOD STAMP PREPAID BURIAL EXEMPTION


SUBJECT:
FOOD STAMP PREPAID BURIAL EXEMPTION

   FOOD STAMP MANUAL REVISION #13:

   Section 1110.020.15 page 1110-7
 
DISCUSSION:
The Food Stamp Regulations were changed to exempt up to $1,500 of the equity value of revocable prepaid burials.  Each household member receives the $1500 exemption for his or her burial.

The entire value of irrevocable prepaid burials continues to be excluded.

The $1,500 exemption is effective immediately.  Attached is revised Section 1110.020.15 of the Food Stamp Manual.
 
NECESSARY ACTION:
  • Review this memorandum with staff.

    •  
  • Begin immediately to exempt up to $1,500 of the equity value of revocable prepaid burials.

    •  
  • File the revised page in IMNL.
BH
Distribution #3
[ Memorandum Table of Contents ]

 
exemption as the family car.  Ms. Green's car should be exempted.  Neither car has a fair market value over $4,650, therefore, the only amount counted as a resource is the equity of Ms. White's vehicle ($1,000).

  In determining the vehicle on which to exempt the equity, apply the exemption to the household's advantage.

  EXAMPLE:  Mr. and Mrs. Jones own two vehicles.  Only one is equity exempt.  Car A has a fair market value of $5,500 and equity of $1,500.  Car B has a fair market value of $4,200 and equity of $2,000.  Compare the fair market value over $4,650 and equity for each vehicle to determine the greater amount.  Car A's considered fair market value of $850 ($5,500 less $4,650) is greater than Car B's considered fair market value of $0 ($4,200 less $4,650).  Because Car B has a greater equity value than Car A, exempt it.  Car A's equity is considered a resource.


1110.020.15      Burial Plots, Life Insurance, and Prepaid Burials
IM-#63  May 21, 1999

Do not count one burial plot per household member.

Life insurance and prepaid burials:

 1. Exempt CSV of life insurance policies.

 2. The CSV of exempt life insurance remains exempt when it is irrevocably assigned to partially or totally fund a burial contract.  The following conditions must be met:

  • a valid preneed burial contract exists, and
  • an agreement exists with the insurance company either transferring ownership of the policy to the funeral home or naming the funeral home as the irrevocable beneficiary.
 3. Exempt irrevocable preneed burial contracts as a resource.  Revocable and irrevocable preneed burial contracts funded by the assignment of life insurance are not an available resource because they have no value during the applicant's lifetime.

 4. Exclude up to $1,500 of each household member's equity value in revocable prepaid burials.  Count the equity value in excess of $1,500 as a resource to the household.

The following explains the types of prepaid burials authorized in state law and what amounts are recoverable.


1110-7