TN 32 (07-90)

SI 01110.600 First-of-the-Month (FOM) Rule for Making Resource Determinations

A. Policy Principle — The FOM Rule

We make all resources determinations as of the first moment of a calendar month.

B. Policy Principle — Significance of the FOM Rule

1. INCREASE IN VALUE OF RESOURCES

We consider any increase in the value of an individual's resources in the resources determination as of the first moment of the month following the month in which:

  • the value of an existing resource increases (e.g., the value of a share of stock goes up or installment payments increase a property's equity value);

  • an individual acquires an additional resource (e.g., inherits property); or

  • an individual replaces an excluded resource with one that is not excluded (e.g., sells an excluded automobile for nonexcluded cash).

2. DECREASE IN VALUE OF RESOURCES

We consider any decrease in the value of an individual's resources in the resources determination as of the first moment of the month following the month in which:

  • the value of an existing resource decreases (e.g., the value of a share of stock goes down);

  • an individual spends a resource (e.g., withdraws $150 from a savings account to pay bills); or

  • an individual replaces a countable resource with one that is not countable (e.g., trades a countable piece of real property for an excluded automobile).

3. TREATMENT OF ASSETS UNDER INCOME AND RESOURCES COUNTING RULES

When an individual receives something in cash or in kind during a month, we evaluate it under the appropriate income- counting rules in that month. If the individual retains the item into the month following that of receipt, we evaluate it under the resource-counting rules. Thus, we do not evaluate the same asset under two sets of counting rules for the same month.

4. RECEIPTS FROM THE SALE, EXCHANGE, OR REPLACEMENT OF A RESOURCE

If an individual sells, exchanges, or replaces a resource, what he/she receives in return is not income. It is a different form of resource. This includes assets which have never been subject to resources counting because the owner sold, exchanged, or replaced them in the same month in which he/ she received them.

SI 00830.510 contains instructions on the income/resources treatment of proceeds received for timber, gravel, and other natural resources.

C. Example — Receipt of a Resource Considered as Income and Exchanged in Same Month

Miss Laramie, a disabled individual,received a $350 unemployment insurance benefit on January 10 at which time it was unearned income. On January 18, she used the $350 to purchase several shares of stock; i.e., she exchanged one resource (cash) for another resource (stock). We never counted the $350 cash payment as a resource because Miss Laramie exchanged it for stock in the month of receipt. The stock is not income; it is a different form of resource. Since a resource is not countable until the first moment of the month following its receipt, we first count the stock in the resources determination made as of
February 1.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0501110600
SI 01110.600 - First-of-the-Month (FOM) Rule for Making Resource Determinations - 10/26/1995
Batch run: 01/27/2009
Rev:10/26/1995