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Administrative Plan 7/1/2025 Page 6-78 <br />EXHIBIT 6-2: TREATMENT OF FAMILY ASSETS <br />24 CFR 5.603(b) Net Family Assets <br />(1) Net family assets is the net cash value of <br />all assets owned by the family, after <br />deducting reasonable costs that would be <br />incurred in disposing real property, savings, <br />stocks, bonds, and other forms of capital <br />investment. <br />(2) In determining net family assets, PHAs <br />or owners, as applicable, must include the <br />value of any business or family assets <br />disposed of by an applicant or tenant for less <br />than fair market value (including a <br />disposition in trust, but not in a foreclosure <br />or bankruptcy sale) during the two years <br />preceding the date of application for the <br />program or reexamination, as applicable, in <br />excess of the consideration received <br />therefor. In the case of a disposition as part <br />of a separation or divorce settlement, the <br />disposition will not be considered to be for <br />less than fair market value if the applicant or <br />tenant receives consideration not measurable <br />in dollar terms. Negative equity in real <br />property or other investments does not <br />prohibit the owner from selling the property <br />or other investments, so negative equity <br />alone would not justify excluding the <br />property or other investments from family <br />assets. <br />(3) Excluded from the calculation of net <br />family assets are: (i) The value of necessary <br />items of personal property; (ii) The <br />combined value of all nonnecessary items of <br />personal property if the combined total value <br />does not exceed the HUD-published <br />threshold amount (which amount will be <br />adjusted by HUD in accordance with the <br />Consumer Price Index for Urban Wage <br />Earners and Clerical Workers); (iii) The <br />value of any account under a retirement plan <br />recognized as such by the Internal Revenue <br />Service, including individual retirement <br />arrangements (IRAs), employer retirement <br />plans, and retirement plans for self- <br />employed individuals; (iv) The value of real <br />property that the family does not have the <br />effective legal authority to sell in the <br />jurisdiction in which the property is located; <br />(v) Any amounts recovered in any civil <br />action or settlement based on a claim of <br />malpractice, negligence, or other breach of <br />duty owed to a family member arising out of <br />law, that resulted in a family member being <br />a person with a disability; (vi) The value of <br />any Coverdell education savings account <br />under section 530 of the Internal Revenue <br />Code of 1986, the value of any qualified <br />tuition program under section 529 of such <br />Code, the value of any Achieving a Better <br />Life Experience (ABLE) account authorized <br />under Section 529A of such Code, and the <br />value of any “baby bond” account created, <br />authorized, or funded by Federal, State, or <br />local government. (vii) Interests in Indian <br />trust land; (viii) Equity in a manufactured <br />home where the family receives assistance <br />under 24 CFR part 982; (ix) Equity in <br />property under the Homeownership Option <br />for which a family receives assistance under <br />24 CFR part 982; (x) Family Self- <br />Sufficiency Accounts; and (xi) Federal tax <br />refunds or refundable tax credits for a period <br />of 12 months after receipt by the family. <br /> (4) In cases where a trust fund has been <br />established and the trust is not revocable by, <br />or under the control of, any member of the <br />family or household, the trust fund is not a <br />family asset and the value of the trust is not <br />included in the calculation of net family <br />assets, so long as the fund continues to be <br />held in a trust that is not revocable by, or <br />under the control of, any member of the <br />family or household. <br />EXHIBIT 1