29.12 Types of income

In general. This subsection describes the kinds of income considered when determining MABD eligibility. Earned income. Earned income includes the following: Gross salary, wages, commissions, bonuses, severance pay received as a result of employment. Income from self-employment (see (c) below for more information about self-employment income). Payments from Economic Opportunity Act of 1964 programs as recipients or employees, such as: (i) Youth Employment Demonstration Act Programs; (ii) Job Corps Program (Title I, Part A); (iii) Work Training Programs (Title I, Part B); (iv) Work Study Programs (Title I, Part C); (v) Community Action Programs (Title II); and (vi) Voluntary Assistance Program for Needy Children (Title II); and Income from: (i) Employment under Title I of the Elementary and Secondary Education Act (e.g., as a teacher’s aide, lunch room worker, etc.); (ii) Wages from participation in the Limited Work Experience Program under the Workforce Investment Act of 1998 (29 U. S. C. §794d); and (iii) Earnings from the Senior Community Service Employment (SCSE) program. Self-employment income Net earnings from self-employment are counted. Net earnings means gross income from any trade or business less the allowable deductions specified in § 29.15(a)(1). Tax forms are used to determine countable income from self-employment. An individual who states that the income on their tax forms is no longer reflective of their situation may submit alternate documentation. When the individual’s business has been the same for several years, income reported on tax forms from the last year is used. When the individual’s business was new in the previous or current year and the individual has business records, income reported on tax forms and other available business records is divided by the number of months the individual has had the business. When the individual’s business has no records, is seasonal or has unusual income peaks, income reported on the individual’s signed statement estimating annual income is included. Unearned income Any payment other than earned income from any source received by an individual or by a member of the individual’s financial responsibility group. It is the gross payment, less allowable deductions at § 29.15(b). Periodic benefits received by an individual as unearned income are counted. Unearned income includes income from capital investments in which the individual is not actively engaged in managerial effort. This includes rent received for the use of real or personal property unless the rent is income from self-employment (e.g., the individual is in the business of renting properties) in which case the self-employment income rule at § 29.12(c) applies. Ordinary and necessary expenses of rental property such as interest on debts, state and local taxes, the expenses of managing or maintaining the property, etc. are deducted in determining the countable unearned income from this source. The deduction is permitted as of the date the expense is paid. Depreciation or depletion of property is not a deductible expense. Unearned income also includes, but is not limited to, the following: (i) Social Security retirement, disability, SSI, or survivor benefits for surviving spouses, children of a decedent, and dependent parents; (ii) Railroad Retirement; (iii) Unemployment compensation; (iv) Private pension plans; (v) Annuities; (vi) Interest earned on life insurance dividends; (vii) Regular and predictable voluntary cash contributions received from friends or relatives; (viii) Cash prizes or awards; (ix) Withheld overpayments of unearned income, unless the overpayment was counted as income in determining Medicaid eligibility in the month received; (x) Royalty payments to holders of patents or copyrights for which no past or present work was or is involved; (xi) Retroactive Retirement, Survivors and Disability Insurance (RSDI) benefits for an individual with drug addiction or alcoholism (such benefits are treated as if they had all been received in a lump sum payment, even if paid in installments); (xii) Veteran’s Administration (VA) pension, compensation and educational payments that are not part of a VA program of vocational rehabilitation and do not include any funds which the veteran contributed; (xiii) Interest payments received by the individual on an income-producing promissory note or contract (such as a property agreement or loan agreement) when the individual is the lender and the note or contract is excluded as a resource under § 29.08(d)(2). (xiv) Alimony and support payments received; and (xv) Death benefits received by an individual to the extent the benefits exceed what was paid by the individual for the expenses of the deceased person’s last illness and burial.