Payments on a land contract that is not negotiable, assignable, enforceable, or marketable are considered income to the recipient. In this case, the petitioner held a life estate in her property while her nephew, the remainder holder, sold his interest on a land contract. Because there was no evidence that the life estate itself was sold, Hearing Examiner Sean Maloney concluded the agency was incorrect to count the land contract payments as the petitioner’s income.
This decision was published with support from the Elder Law & Special Needs Section of the State Bar of Wisconsin, the Wisconsin chapter of the National Academy of Elder Law Attorneys, and Krause Financial.
Preliminary Recitals
Pursuant to a petition filed February 27, 1997, under §§ 49.45(5) & 49.21(1)(b) Wis. Stats. to review a decision by the Burnett County Department of Social Services (County) to budget land contract income from property on which petitioner has a life estate toward petitioner’s nursing home care for purposes of Medical Assistance (MA), a Fair Hearing was held on April 28, 1997 in Siren, Wisconsin.
A Fair Hearing set for April 3, 1997 was rescheduled at petitioner’s request.
This matter concerns the same issue as a prior petition (MED-07/97455) dated August 22, 1996 and filed by petitioner’s nephew, —, on August 22, 1996. A Fair Hearing on that petition was set for September 17, 1997 in Siren, Wisconsin. Neither petitioner, —, or any other representative of petitioner appeared on September 17, 1996. Consequently, by a Decision dated September 25, 1996, petitioner’s petition MED-07/97455 was dismissed.
By Letters of Guardianship, signed by the Honorable James H. Taylor of the Burnett County Circuit Court on December 19, 1996 (File No. 96-GN-66), — of Grantsburg, Wisconsin was appointed guardian of the person and estate of petitioner because petitioner is incompetent. Exhibit #1. On February 27, 1997 petitioner’s guardian filed this petition (MRA-7/13241), dated February 26, 1997. The appointment of — as petitioner’s guardian because petitioner is incompetent is an altered condition that requires a Decision on the merits on the issue presented by petitioner’s petitions.
The issue for determination is whether the County was correct to budget land contract income from property on which petitioner has a life estate toward petitioner’s nursing home care for purposes of MA.
There appeared at that time and place the following persons:
PARTIES IN INTEREST:
Petitioner:
— (not present at Fair Hearing)
By:
—
Department of Health and Family Services
Bureau of Welfare Initiatives
1 West Wilson Street
Room 350
P.O. Box 7851
Madison, Wisconsin 53707-7851
By: Janice Wieser, ESS
Burnett County Department of Social Services
P.O. Box 300-130
Siren, Wisconsin 54872
Other Appearances: — petitioner’s nephew
EXAMINER:
Sean P. Maloney, Hearing Examiner
Division of Hearings and Appeals
Findings of Fact
- Petitioner (SSN: — CARES No. —) is a resident of Burnett county.
- In August 1991 petitioner transferred certain property (the Property) to her nephew, —, and retained a life estate for herself. Exhibits #2, #3 & #4.
- In August 1991 — sold the Property on land contract to — and —. Exhibits #2, #3 & #5.
- Petitioner retains her life estate in the Property. Exhibits #3 & #5.
- Petitioner has not sold or transferred her life estate in the Property.
Discussion
The County’s position is that part of the land contract income from the Property must be budgeted toward petitioner’s nursing home care for purposes of MA. Apparently, the County took this position based on petitioner’s ownership of a life estate in the Property. Exhibits #2 & #3. The county’s position is not correct.
In August 1991 petitioner transferred certain property (the Property) to her nephew, — and retained a life estate for herself. In August 1991 — sold the Property on land contract to — and —. Petitioner retains her life estate in the property.
A life estate is an unavailable asset. MA Handbook, Appendix 11.7.5. A recipient of MA may hold a life estate without affecting eligibility for MA. § HFS 103.06(6) Wis. Adm. Code; see also § 49.453(8) Wis. Stats.
Petitioner has not sold or transferred her life estate in the Property. See, § HFS 103.06(6) Wis. Adm. Code. There is no evidence in the record of this matter that petitioner is legally entitled to any portion of the land contract income. See, MA Handbook, Appendix 11.1.0 & 15.1.0.
Therefore, the County was not correct to budget land contract income from the Property toward petitioner’s nursing home care for purposes of MA.
Conclusions of Law
The County was not correct to budget land contract income from the Property toward petitioner’s nursing home care for purposes of MA.
THEREFORE, it is
Ordered
the County not budget land contract income from the Property toward petitioner’s nursing home care for purposes of MA and that, within ten days of the date of this Decision, the County issue to petitioner the MA benefits, if any, that petitioner is otherwise entitled to and that have not been issued to petitioner because of the budgeting of land contract income from the Property toward petitioner’s nursing home care.
[Request for a rehearing and appeal to court instructions omitted.]
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