PM 07-04-05

Property Producing Income Consistent with Its Value

Property, other than property that is essential to employment or self-employment, must annually produce income consistent with its fair market value.

Determine if property is producing income consistent with its fair market value, by establishing the prevailing rate of return for similar property in the area. Determine the prevailing rate of return by contacting local realtors, local tax assessors, the Small Business Administration, the Farmers Home Administration, or other similar sources.

If property is not producing income consistent with its fair market value, the property is a nonexempt asset that affects eligibility.

Property Essential to Employment

Property that is exempt as essential to employment or self-employment of a unit member does not have to be producing income consistent with its fair market value.

Example: Farm land is essential to employment as a farmer, so a bad crop year would not affect the property's exempt status.

NOTE: A rental home is not essential to the employment or self-employment of a unit member if some or all of the unit members use the rental home for vacation purposes during the year. In this situation the home is only exempt if it is annually producing income consistent with its fair market value.

Property Used for an Exempt Vehicle

A portion of real property determined necessary for maintenance or use of a vehicle used to produce income, or needed to transport a disabled unit member, is exempt.

Example: A SNAP unit that owns a produce truck for selling fruit and vegetables is prohibited from parking the truck in a residential area. The unit owns a 90 acre field and uses a quarter acre of the field to park and service the truck. Exempt the value of the quarter acre.