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repayments toward the principal of the loan as income. Deduct from the gross amount any expenses the person is required to pay by the terms of the contract. If the income is received less often than monthly, prorate the income to a monthly amount. Do not begin budgeting this monthly amount until the person first receives a payment after becoming eligible. Example 2 Bob receives land contract payments from Farmer Brown twice a year: one $5,000 payment in March and another $5,000 payment in September. Ten percent of that payment is interest. If Bob is applying in February, prorate the land contract payments Bob receives after he becomes eligible. In March when Bob receives a $5,000 land contract payment, divide the total countable income ($5,000 times 10 percent equals $500) by the frequency of the payments (six months) to get the budgeted income amount of $83.33 per month ($500 divided by six months equals $83.33). Begin budgeting this amount in March. 15.4.8 Loans, Promissory Notes, and Mortgages If an AG member makes a loan, promissory note, or mortgage (including a land contract), treat the repayments as follows: 1. Count the interest as unearned income in the month received. 2. Count any repayments toward the principal of the loan, regardless of whether it is a full payment, a partial payment, or an installment payment, as an asset but only if the promissory note itself is an available counted asset. 3. When the promissory note cannot be sold because it is not considered to be negotiable, assignable, enforceable, and marketable, it cannot be considered an available asset. Count any repayments toward the principal of the loan as income. 4. If an AG member receives a loan and it is available for current living expenses, count it as an asset. Do this even if there is a repayment agreement. If it is not available for current living expenses, disregard it. 15.4.9 Interest and Dividend Income 15.4.9.1 Elderly, Blind, or Disabled Interest and Dividend Income Most interest and dividend earnings are excluded income so are not counted when determining Medicaid eligibility. See SECTION 15.4.9.1.1 EXCLUDED SOURCES OF INTEREST OR DIVIDEND INCOME for excluded sources of interest or dividend income and SECTION 15.4.9.1.2 INTEREST AND DIVIDENDS INCOME NOT EXCLUDED FOR ELDERLY, BLIND, OR DISABLED MEDICAID for interest and dividend income not excluded for EBD. Most interest and dividend income from a resource excluded under SSI rules will be an excluded source of income for all Medicaid eligibility and post-eligibility determinations. The are, however, some exceptions (see SECTION 15.4.9.1.2 INTEREST AND DIVIDENDS INCOME NOT EXCLUDED FOR ELDERLY, BLIND, OR DISABLED MEDICAID). 15.4.9.1.1 Excluded Sources of Interest or Dividend Income Do not count the following sources of interest or dividend payments: • Interest or dividend income from a non-exempt resource, such as savings accounts, checking accounts, stocks, or bonds • Medicaid resources that are exempt by federal statute other than the Social Security Act: ◦ Agent Orange Settlement Payments