TN 104 (06-09)

SI 00830.520 Gifts

Citations:

Soc. Sec. Act, as amended, sections 1612(a)(2)(D) and 1612(a)(2)(E), and 1612(b)(7);

P.L. 108-203, § 435; 20 CFR § 416.1121(g); 20 CFR § 416.1124(c)(3)

A. Policy for gifts

1. Definition of a gift

A gift is something a person receives which is not repayment for goods or services the person provided and is not given because of a legal obligation on the giver's part.

A gift is something that is given irrevocably (i.e., the giver relinquishes all control.)

“Donations” and “contributions” may meet the definition of a gift.

A gift received as the result of a death is a death benefit. For more information about death benefits, see SI 00830.545.

2. Gift as income

A gift is unearned income subject to the general rules pertaining to income and income exclusions.

REMINDER: The value of any non-cash item (other than food or shelter) is not income if the item would become a partially or totally excluded non-liquid resource if retained in the month after the month of receipt. For more information about this exception, see SI 00815.550.

3. Gifts used to pay tuition, fees, or other necessary educational expenses

For benefits payable on or after June 1, 2004:

  • Income - Gifts (or a portion of a gift) used to pay for tuition, fees, or other necessary educational expenses at any educational institution, including vocational and technical education, are excluded from income. For more information on the treatment of income used for educational expenses, see SI 00830.455.

  • Resources - Gifts (or a portion of a gift) used to pay for tuition, fees, or other necessary educational expenses at any educational institution, including vocational and technical education, are excluded from resources for the 9-month period beginning the month after the month the gift was received. For more information on this exclusion, see SI 01130.455.

B. Procedure for considering gifts

1. Tolerance for valuing

Accept an individual's statement, either signed or recorded on a DROC an estimating the value of the gift (or actual value if cash) unless you have reason to doubt the estimate. If you doubt the estimate, determine the item's current market value (CMV) with an independent source. For the definition of CMV, see SI 00835.020. For instructions on electronic evidence documentation and retention, see GN 00301.286.

2. Determine whether the gift is countable

Determine the nature of the gift and apply the appropriate operating instructions pertaining to income and income exclusions.

When developing the nature of the gift, be alert to situations where the gift is a loan. For more information on how to develop a loan, see SI 01120.220.

3. Gifts used to pay tuition, fees, or other necessary educational expenses

If gifts are used to pay for tuition, fees, or other necessary educational expenses at any educational institution, including vocational and technical education, follow the instructions in SI 00830.455 and SI 01130.455 for income and resources policy and procedures.

C. Examples

1. Gift of jewelry

If a gift of jewelry retained into the month after the month of receipt is excluded from resources as part of an individual's personal effects, it does not count as income. For more information on the personal effects exclusion, see SI 01130.430. If the jewelry is not an excluded resource, it is counted as unearned income at its CMV.

2. Gift of a car

A gift of a car that qualifies as a wholly or partially excluded resource if retained into the month after the month of receipt is not income. If the car does not qualify as a wholly or partially excluded resource (e.g., it is a second car), the car is counted as income in the month it is received. For information on how to determine the value of an automobile, see SI 01130.200.

3. Gift of a house

Even though a house that is used as shelter qualifies as an excluded resource, gifts of food and shelter items are treated differently than other gifts. A gift of a house that is used as the recipient's shelter is valued under the presumed maximum value (PMV) rule as described in SI 00835.300. A gift of a house that is not shelter is valued at its CMV. To determine the CMV of non-home real property, see SI 00835.020 and SI 00835.310C.