1003 Determining Deductions for All Households

Deductible deductions include only certain dependent care, shelter, and medical expenses as described in Chapter 9. A. Disallowed Expenses An expense covered by an excluded reimbursement or vendor payment, except an energy assistance vendor payment made under the Low Income Home Energy Assistance Program (LIHEAP) shall not be deductible. For example, the portion of rent covered by excluded vendor payments shall not be calculated as part of the household’s shelter cost. Utility expenses which are reimbursed or paid by an excluded payment, including HUD and FmHA utility payments shall not be deductible. Households are entitled to use either the SUA or BUA (as appropriate) or actual costs in excess of the excluded payments. That portion of an allowable medical expense which is not reimbursable shall be included as part of the household’s medical expenses. Households entitled to the medical deduction shall have the non-reimbursable portion considered at the time the amount of reimbursement is received or can otherwise be verified. Expenses shall only be deductible if the service is provided by someone outside of the household and the household makes a money payment for the service. For example, dependent care deduction shall not be allowed if another household member provides the care, or compensation for the care that is provided in the form of an in-kind benefit such as food. B. Billed Expenses Except as provided in Section 1003 D; a deduction shall be allowed only in the month the expense is billed or otherwise becomes due, regardless of when the household intends to pay the expense. 1. A particular expense may only be deducted once in prospectively budgeted households. Amounts carried forward from past billing periods are not deductible, even if included with the most recent billing and paid by the household. For example, rent which is due each month shall be included in the household’s shelter costs, even if the household has not yet paid the expense. 2. An on-going medical expense, such as prescription drugs or attendant care, is to be budgeted at the point it is reported and verified. A deduction cannot be given for any ongoing medical expense incurred in a prior billing period. When an ongoing medical expense is reported and verified the medical deduction will be recalculated to include this expense. 3. Medical expenses billed on a monthly basis because of contract or agreement shall have only the monthly payment bill budgeted as a medical deduction rather than averaging the entire non-reimbursed expense. C. Averaging Expenses Households may elect to have fluctuating expenses averaged. Using the procedures for averaging fluctuating income, a minimum of two months expenses shall be used to determine a monthly average. Households may also elect to have expenses which are billed less often than monthly averaged forward over the interval between scheduled billings, or, if there is no scheduled interval, averaged forward over the period the expense is intended to cover. For example, a household receives a single bill in February which covers a 3-month supply of fuel oil. The bill may be averaged over February, March and April. The household may also elect to have one-time only expenses averaged over the entire certification period in which they are billed. Households reporting one-time only medical expenses during their certification period may elect to have a one-time deduction or to have the expense averaged over the remaining months of their certification period. Averaging would begin the month the change would become effective. D. Anticipating Expenses The county department shall calculate a household’s expenses based on the expenses the household expects to be billed for during the certification period. Anticipation of the expense shall be based on the most recent month’s bills, unless the household is reasonably certain a change will occur. The exception is that a household’s monthly medical deduction for the certification period shall be based on the information reported and verified by the household, and any anticipated changes in the medical expenses that can be reasonably expected to occur during the certification period based on the available information about the recipient’s medical condition, public or private insurance coverage and current verified medical expenses. If a household reports an allowable one time medical expense at the time of certification, but cannot provide verification at that time, and the amount cannot be reasonably anticipated, the household shall have the non-reimbursable portion of the expense considered at the time the expense or the reimbursement is reported and verified. E. Conversion of Deductions Deductions which are billed weekly or biweekly may be converted to a monthly amount by multiplying an average weekly amount by 4.3 or an average biweekly amount by 2.15. F. Energy Assistance Payments Except for payments made under the Low Income Energy Assistance Act (LIHEAA) and other Federal energy assistance payments excluded in Section 902.2, the county department shall prorate energy assistance payments provided over the entire heating or cooling season the payment is intended to cover. G. Entitlement to Medical Deductions and Uncapped Shelter Expenses Individuals entitled to the excess medical deduction and the uncapped shelter expense shall receive such deductions, if they incur such expenses, for the period for which they are determined to be elderly or disabled. 1. Such individuals who are entitled to restored benefits shall have their benefits restored using these special deductions if they have such expenses. 2. Medical expenses incurred prior to the month in which the individual turned 60 or began receiving qualifying disability benefits shall not be considered as allowable medical costs. 3. A deduction may be allowed for paid or unpaid medical expenses provided such expenses are reported within the certification period in which they are incurred. One time medical expenses incurred or reported too late to be budgeted in the current certification period shall be allowed in the new certification period either as a one-time deduction in the first month of the new certification period or prorated over the entire certification period. This includes such expenses previously incurred and reported at the recertification interview or expenses incurred after the recertification interview and reported sometime during the new certification period.