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Aged, Blind and Disabled Manual Policy Manual Number: 110.005 Section: Financial Eligibility Requirements Chapter: ABD Income Overview

November 01, 2021 Division of TennCare 5

x. Legally obligated alimony; xi. Court ordered bankruptcy; xii. Mandatory taxes; xiii. Service fees charged on interest-bearing checking accounts; xiv. Inheritance taxes; or xv. Guardianship fees if presence of a guardian is not a requirement for receiving the income. Note: Mandatory deductions such as FICA and withholding tax on pensions and other unearned income are not included in gross income for Institutional Medicaid and the Medicare Savings Programs (MSPs).

b. Expenses of Obtaining Income Unearned income does not include any portion of a payment used for expenses incurred in receiving the income. The expense must have been an essential factor in obtaining the income. For example, if an individual is paid for damages he received in an accident, the individual’s medical, legal, or other expenses connected with the accident may be deducted from the payment, as long as the expenses are verified. The payment of personal income taxes is not an expense and should not be deducted from unearned income. 6. Counting Income Eligibility is determined based on monthly income. All income must be converted to a monthly figure. The following formulas are used to convert income to a monthly amount. a. Hourly Work: Multiply the hourly wage by the number of hours the individual worked or is expected to work in a week to determine the weekly earnings figure.

b. Weekly Income: Multiply weekly income by 4.3333 to determine monthly income.

c. Bi-Weekly Income: Multiply the amount received every two weeks by 2.1666 to determine the monthly amount.

d. Semi-Monthly Income: Add the two semi-monthly amounts together to determine the monthly amount.

e. Annual Income: Divide the full amount of annual income by 12 to determine the average monthly amount.