5156-3        CONVERSION OR SALE OF A RESOURCE

Conversion or sale of a resource occurs when a resource of any form is exchanged for a resource of another form (i.e., a liquid resource exchanged for a non-liquid resource or vice versa).  Conversion would also occur by exchanging a non-liquid resource for another non-liquid resource (e.g., an individual may trade an automobile for a pickup truck).  Any conversion or sale of a resource does not represent income to the recipient.  For example, an individual may have an automobile (non-liquid resource) which he sells for $300 (liquid resource), or he may have $300 that he uses to purchase an automobile.  In either case, the conversion or sale does not result in income to the recipient.  The newly acquired item (whether liquid or non-liquid in nature) is a resource subject to all the resource criteria for continuing eligibility.

Refunds or reimbursements often appear to produce countable income.  However, they may in fact be conversion of resources, and the resulting production of cash should be counted only as liquid resources, not as income.  This is true whether or not the resource being converted was available and not exempt.  Examples of this kind of conversion include:

• Refund of a rent deposit or rental cleaning deposit.  This is an unavailable, uncounted liquid resource that is converted to an available liquid resource when the individual moves.
   

• A piece of merchandise is returned in exchange for refund of the purchase price.
   

• Money paid out for a repair is later refunded by the manufacturer under product warranty provisions.
   

• A person receives a federal or state income tax refund.
   

• An employer reimburses an employee for out-of-pocket expenses related to work.
   

• A person not of retirement age cashes in their paid-up entitlement to a past employer's retirement fund.