Sole Benefit Requirements Related to Transfer of Assets

Assets that are part of the community spouse resource allowance (CSRA) do not have to meet the “sole benefit” requirement above.  Transfers of all assets, including excluded assets (such as the home or property that is listed for sale) must meet the “sole benefit” requirement, otherwise they are disqualifying transfers.  Even when the excluded home is transferred to the community spouse or child with a disability, it must be for the spouse’s/child’s “sole benefit” or it is a disqualifying transfer.  If the asset that is transferred is real property, the “sole benefit” requirement is met by having only the spouse’s or child who has a disability’s name on the deed.  If the asset is cash (such as the proceeds from the sale of real property or an inheritance) in order to meet the “sole benefit” requirement, there must be a transfer instrument, such as an annuity or irrevocable trust, that makes equal payments over the spouse’s/child’s expected lifetime with the client named as the first remainder beneficiary.  This will prevent the funds from later transferring to any other beneficiary in the future, if the spouse/child pre-deceases the client.  Contact the central office policy unit about a disqualifying transfer if:  1) a transfer is made to a spouse or child with a disability that is not structured in such a way as to be for their “sole benefit”, and 2) if a transfer is made that is for the “sole benefit” but you learn that it has changed later (for example, the spouse’s name was put on the deed to the home, and then the property was transferred to a trust that names other beneficiaries when the spouse dies).