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Iowa LIHEAP Policy and Procedures Manual Appendix C – Income Source Guide

Effective 09/01/2023

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Note - A Long-Term Disability (LTD) insurance carrier will likely require the person to file for Social Security Disability benefits because most insurance policies allow the insurance company to reduce the LTD payment dollar-for- dollar by the amount the person receives from Social Security. For example, when a person who receives $1,500 in LTD benefits per month is approved for $1,000 in Social Security Disability, that person will still collect a total of $1,500 with $1,000 of the amount coming from Social Security and the remaining $500 from the LTD insurance carrier. The amount by which the LTD payment is reduced is called an offset. Lump-Sum* (Non-Recurring) If it is a lump-sum retroactive payment, received during the verification period, count only the payment that would apply to the verification period.

Was the non-recurring lump-sum (unlikely to occur again) received during the verification period?

No – not counted as income

Yes – counted as income and pro-rated for the verification period (see below)

Example #1 Aaron Aardvark has been trying to obtain disability approval for two years (24 months) and finally received a lump-sum payment of $10,000 during the 30-day verification period. The payment covered 24 months; therefore, it is to be divided by 24,

X

X Official documents, check stubs, bank statement, or check copy can be used as documentation.