Page 154

2. Divide the result in step 1 (the total annual expenses) by the total number of units to get the proportionate annual share of expenses. 3. Multiply the amount in step 2 (the proportionate annual share of expenses) by the number of rental units (rental units means the total number of units minus the unit the owner lives in) to get the member's total annual expenses. 4. Subtract the result in step 3 (the member’s total annual expenses) from the total annual rental income to get the member’s net annual rental income. 5. Divide the result of step 4 (the member’s net annual rental income) by 12 to get the member’s net monthly rental income. Budget this amount. Example 1 George owns a four-unit apartment building and lives in unit 1. His annual interest paid on his mortgage for the most recent tax year is $9,765. His operational expenses, including taxes on the building, from the most recent taxes is $12,359. This totals $22,124. This amount divided by four units equals a proportionate share of $5,531. $5,531 multiplied by three rental units equals $16,593. This represents his total budgetable annual expenses. His total annual rental income equals $28,800 ($800 per unit per month). $28,800 -$16,593 $12,207 $12,207 / 12 = $1,017.25 net monthly rental income 16.4.3.4 Calculating BadgerCare Plus Self-Employment Income BadgerCare Plus income is calculated in one of the following ways: • Using IRS tax forms (see SECTION 16.4.3.4.1 IRS TAX FORMS AND WORKSHEETS) completed for the previous year • Anticipating earnings (see SECTION 16.4.3.4.3 ANTICIPATED EARNINGS) 16.4.3.4.1 IRS Tax Forms and Worksheets IM workers do not fill out any IRS tax forms on an applicant’s or member’s behalf. It is the responsibility of the applicant or member to complete IRS tax forms. Workers should consult IRS tax forms only if all of the following conditions are met: • The business was in operation at least one full month during the previous tax year. • The business has been in operation six or more months at the time of the application. • The person does not claim a change in circumstances since the previous year. If all three conditions are not met or if IRS tax forms were not filed and are not available, use anticipated earnings (see SECTION 16.4.3.4.3 ANTICIPATED EARNINGS). If you decide to use IRS tax forms, use them together with the chart in Process Help, Section 11.2 Self- Employment Income or the self-employment income worksheets, which identify which income and expenses must be entered onto the Self-Employment page by line on the IRS tax forms. For each operation, select the worksheet you need (if applicable) and, using the provided tax forms and/or schedule, complete the worksheet (if applicable) and enter the income and expenses onto the Self-Employment page. 1. Sole Proprietor. There is no worksheet for Sole Proprietor. See Process Help, Section 11.2.2.3.2 Entering Information for a Sole Proprietorship to identify which lines must be entered in CWW for each of the following IRS tax forms: