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Title 8: Medicaid Page 50 Iowa Department of Health and Human Services Employees’ Manual Chapter E: Income Non-MAGI-Related In-Kind Income Revised May 22, 2026 In-Kind Support and Maintenance (ISM) Paying a Pro Rata Share Legal reference: 20 CFR 416.1132-416.1133 If the client pays a pro rata share of household operating expenses, consider the client to be living in his or her own home and not receiving in-kind support and maintenance from anyone else in the household. The pro rata share of household operating expenses is the average monthly household operating expenses (based on a reasonable estimate, if exact figures are not available) divided by the number of people in the household, regardless of age. The household operating expenses are the total monthly expenditures for rent, mortgage, property taxes, heating fuel, gas, electricity, water, sewage, and garbage collection service. When to Apply the Value of One-Third Reduction (VTR) Rule Legal reference: 20 CFR 416.1131 Apply the “value of one-third reduction” (VTR) rule to in-kind support and maintenance received when a client lives the whole month in another person’s household and others within the household pay for or provide them with all their meals. If the client is living in the client’s own household, use the “presumed maximum value rule.” Under the VTR rule, the value of in-kind support and maintenance is one-third of the SSI benefit rate (currently $331.33). If a married couple lives in another person’s household, use one-third of the SSI benefit rate for a couple ($497.00). The VTR amount always applies in full. Count this amount in the same way as if it were unearned income received in cash. Do not apply the $20 general income exclusion to in-kind support and maintenance valued according to the VTR rule. An SSI recipient who receives in-kind support and maintenance valued according to the VTR method will have that income reflected on the SDX as income type “J.”