Burial resources include both burial spaces and burial reserves.
NOTE: If excess resources are used to set up a burial reserve (revocable or irrevocable), an overpayment still occurs in the calendar month that the total resources were more than the resource limit.
The recipient is required to repay the benefit received in the calendar month when their total resources exceeded the resource limit.
Example: Mrs. Armstrong and her two children receive TANF. On January 2, Mrs. Armstrong receives 100 shares of common stock, valued at $2,000, as a gift from a relative. She also has $300 in her savings account.
The budget group's total resources, $2,300, exceed the resource limit.
On January 3, Mrs. Armstrong sells the stock and, after paying a $200 brokerage fee, receives $1,800. The budget group's countable resources from the sale of stock in addition to the savings account are now $2,100.
On January 5, Mrs. Armstrong sets up an irrevocable burial reserve at a bank with $1,300 from the proceeds of the stock sale and puts the remaining $500 in the savings account.
The budget group's $800 countable resources are now below the resource limit.
However, the budget group cannot use the exempt burial reserve to reduce her excess countable resources for the period January 2 through January 4.
Therefore, the budget group is ineligible for and must repay the benefit received in January. The CAO processes an overpayment.
The budget group will be eligible beginning in February since the countable resources, $800, are below the resource limit and there are no other changes.
Reminder: Any interest earned on the savings account must be treated as income. See Chapter 150.
One burial space per budget group member is exempt as a resource. Each legally responsible relative (LRR) and noncitizen sponsor may own one burial space.
A burial space is a conventional grave site, crypt, burial drawer, mausoleum, urn, or other repository used to inter the remains of a deceased person.
Any additional burial spaces owned by the budget group are considered nonresident real property. The requirements and procedures in Section 140.63 apply.
The CAO must count the equity value of the number of burial spaces exceeding one burial space for each budget group member. The equity value of burial spaces owned by the budget group for common residence members who are not members of the budget group are counted as a resource if they are legally available to the budget group.
Burial space information can be obtained from the cemetery where the burial spaces are located. The CAO must verify ownership, conditions of possible resale, and equity value.
NOTE: If a cemetery will not allow the resale of additional burial spaces, they are considered legally unavailable and their equity value is not counted as a resource.
Burial reserves are funds that are set aside for the burial of a person. These funds are usually held in an account or trust that is either revocable or irrevocable. These burial reserves must be bona fide funeral agreements that are held in trust or under contract with a financial institution or a funeral director. Bona fide burial reserves or funeral agreements do not include set-aside savings.
NOTE: The cash value of a life insurance policy, subject to the limit noted in Section 140.721, may be exempted as a bona fide burial reserve if it has been committed by the client for burial through a contract with a funeral director or a financial institution. The worker must verify the existence of the contract.
A prepaid funeral is an agreement between a person and a funeral home for a funeral that is paid for in advance and specifies the services to be provided at the time of the person’s death. The agreement may include such items and services as, a casket, flowers, a cemetery plot, and an obituary.
The CAO must review a prepaid funeral in the same way as any other burial reserve.
The CAO must exempt up to $1,500 in a bona fide revocable burial reserve for each budget group member. The budget group must provide written verification that the funds are for burial. Since the budget group member has access to these funds, any amount over $1,500 is counted toward the budget group’s resource limit.
Example: Mrs. McDowell is applying for TANF for herself and one daughter. During the application interview, Mrs. McDowell produces a bona fide burial reserve contract with a funeral director with a balance of $1,900. There are no restrictions on the account.
The CAO exempts $1,500 of the account balance as a burial reserve. The remaining $400, is counted toward the budget group's resource limit.
Reminder: Since there are no restrictions on a revocable burial reserve, the interest earned on the account is available and is counted as income to the budget group. See Chapter 150.
Interest earned on irrevocable burial reserves may also be counted, unless verification is provided indicating that the interest is placed back into the reserve.
Exception: If a burial reserve in excess of $1,500 is found to be revocable but the financial institution or funeral director refuses to release the excess, the CAO must consider the excess funds unavailable to the budget group. However, in this situation, the budget group must do the following:
Pursue the release of the excess funds; and
Report to the CAO if the funds are released by the funeral director.
Funds held in an irrevocable burial reserve are excluded as a resource to the budget group.
55 Pa. Code § 177.24(1)(i) 55 Pa. Code § 177.24(1)(ii)
If the CAO cannot determine if a burial reserve is irrevocable, all documentation obtained is sent through the area manager for review by DHS's Office of Legal Counsel.
Reminder: If the interest on an irrevocable trust can be withdrawn, the interest is counted as income to the budget group, whether or not it is actually withdrawn. See Chapter 150.
NOTE: Personal property, such as stock, is considered an irrevocable burial reserve if:
the budget group does not have access to the resource; and
the beneficiary or co-owner is a financial institution or funeral director.
The CAO must verify the following:
The revocable or irrevocable status of each burial reserve
The amount and availability of interest earned on all burial reserves
The balance of each revocable burial reserve
Burial reserves may be verified by a statement from the financial institution or funeral director holding the funds.
The CAO must examine the case record for PA 44s also known as a Burial Reserve Agreement. These forms are obsolete prior to 2007 but if one exists in the case record it must be retained.
If a case record is to be destroyed, the CAO must retain these documents. The CAO must write to the person covered by the reserve as a reminder of the reserve’s existence.
If a person wishes to dissolve a burial reserve set up with a PA 44 or another similar document, the CAO must forward the request to OSIG. The reserve may not be dissolved until the claim for reimbursement of assistance received is satisfied.
Revised August 28, 2020, replacing September 20, 2012.