New Mexico Administrative Code
Title 8 - SOCIAL SERVICES
Chapter 281 - MEDICAID ELIGIBILITY - INSTITUTIONAL CARE (CATEGORIES 081, 083 AND 084)
Part 510 - TRUST STANDARDS
Section 8.281.510.14 - USE OF TRUST V. TRANSFER RULES FOR ASSETS PLACED IN TRUST

When a non-excluded asset is placed in a trust, a transfer of assets for less than fair market value generally takes place. An applicant/recipient (or someone acting on behalf of the applicant/recipient) placing an asset in a trust generally gives up ownership of the asset to the trust. If the applicant/recipient does not receive fair compensation in return, a penalty is imposed under the transfer of assets provisions. However, the trust provisions contain specific requirements for treatment of assets placed in trusts. These requirements indicate when assets are considered countable as income or resources, and as a transfer of assets depending on the specific circumstances of the particular trust. Application of the trust regulations, along with the imposition of a penalty for the transfer of the assets into the trust, could result in the applicant/recipient being penalized twice for actions involving the same asset. If an asset is subject to the trust regulations and a transfer of asset penalty, the requirements of the trust regulations take precedence over a transfer of assets penalty for the same asset.