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B. These payments are treated as follows:

1. When sick pay is received within 6 months after stopping work, and it is not attributable to the employee’s own contributions through payroll deduction to a sick pay plan, treat as earned income.

2. When sick pay is received within 6 months of stopping work, and it is attributable to the employee’s own contributions through payroll deduction to a sick pay plan, treat any portion of the sick pay received by the employee which, according to the employer is attributable to the employee’s own contributions, as unearned income.

3. When sick pay is received more than 6 months after stopping work, treat as unearned income.

a) To determine the 6-month period after stopping work:

1) Begin with the first day of non-work.

2) Include the remainder of the calendar month in which work stops.

3) Include the next 6 full calendar months.

b) Example: If an individual stops work on May 5, the 6-month periods ends November 30th.

Source: Social Security Act §1902 (r)(2); 42 CFR § 435.601(b) (Rev 1994).

Rule 9.2: Wages and Salaries.

A. These payments are defined as follows:

1. Wages are what an individual receives (before deductions) for working as someone else’s employee.

a) Under certain conditions, services performed as an employee are deemed self- employment rather than wages, e.g., ministers, real estate agents, share farmers, insurance salesmen, etc.

2. Wages may take the form of:

a) Salaries. Payments (fixed or hourly rate) received for work performed for an employer.

b) Commissions. Fees paid to an employee for performing a service, i.e., a percentage of sales.