N.M. Admin. Code § 8.215.500.20

Current through Register Vol. 35, No. 24, December 23, 2024

Section 8.215.500.20 - UNEARNED INCOME

A. Unearned income includes all income not earned in the course of employment or self-employment.

B. Income paid to one spouse is considered the income of that spouse. One-half the total income paid to a couple is considered available to each member of the couple.

(1) If payment is made in the name of either or both spouses and another party, only the applicant/recipient's proportionate share is considered available to him/her.

(2) If income is derived from property for which ownership is not established, such as unprobated property, one-half of the income is considered available to each member of a married couple.

C.Standards for unearned income: Unearned income is computed on a monthly basis. If there are no expenses incurred with the receipt of unearned income, such as annuities, pensions, retirement payments or disability benefits, the gross amount is considered countable unearned income.

(1)Social security overpayments: If the social security administration withholds an amount because of an overpayment, the gross social security payment amount is used to determine eligibility.

(2)Rental income: If an applicant/recipient has rental property, the ISD worker allows the cost of real estate taxes, maintenance and repairs, advertising, mortgage insurance and interest payments on the mortgage as deductions from the amount received as rent.

(3)Interest on promissory note or sales contract: The portion of the payment representing interest received from a promissory note or sales contract is considered unearned income. The market value of promissory notes or sales contracts and the portion of the payment representing payment of the principal are considered resources. See also Subsection L of Section 8.215.500.14 NMAC, home replacement exclusion.

D.Unearned income exclusions:

(1)Interest from an excluded burial fund: Interest from an excluded burial fund is not considered unearned income if the interest is applied toward the fund balance. If the interest is paid to the applicant/recipient, it is considered unearned income.

(2)Tax refunds and earned income tax credit: Tax refunds from any public agency for property taxes or taxes on food purchases are totally excluded. Any portion of a federal income tax return which constitutes an earned income tax credit is excluded.

(3)Grants, scholarships and fellowships: All grants, scholarships and fellowships used to pay tuition and fees at an educational institution, including vocational and technical schools, are totally excluded. Any portion of a grant, scholarship or fellowship used to pay any other expense, such as food, clothing or shelter, is not excluded.

(4)Veterans payments: Veterans aid and attendance (A&A) payments are excluded from unearned income for determination of eligibility.

(a) If an applicant/recipient receives an augmented VA payment as a veteran or veteran's widow or widower, the payment amount may include an increment for a dependent. If so, the VA must be contacted to provide documentation of the portion of the payment which represents the dependent's increment. When verified, this amount of the VA payment is considered the dependent's income.

(b) The portion of a veterans administration improved pension (VAIP) benefit intended for unreimbursed medical expenses is excluded for purposes of eligibility determination.

(5)Payments by a third party: Third party payments are excluded as income if made directly to the applicant/recipient's creditor.

(a) Third party payments may include mortgage payments by credit life or credit disability insurance and installment payments by a family member on a burial plot or prepaid burial contract.

(b) Interest from a burial contract that is automatically applied to the outstanding balance is excluded from unearned income. If the payment or interest is sent to the individual, it is counted as unearned income regardless of the sender's (third party's) intentions. This applies even if the sender specifies the purpose of the payment on the check.

(c) This provision does not apply if the signature of the creditor and the individual must both be present in order to negotiate the check (two-party check).

(6)Indian tribe per capita payments: Certain per capita payments are excluded from income and resources.

(a) Up to two thousand dollars two thousand dollars ($2,000) of per capita distributions of judgment funds to members of the confederated tribes of the Warm Springs Reservation are excluded except for funds held by Alaska native regional and village corporations (ANRVC) that are not held in trust by the secretary of the interior. ANRVC dividend distributions are not excluded from countable income under this exclusion (per Public Law 97-436 section 4, 98-64, and 100-580).

(b) All distributions to heirs of certain deceased Indians under the Old Age Assistance Claims Settlement Act except for per capita shares in excess of two thousand dollars ($2,000) (per Public Law 98-500 section 8).

(c) Up to two thousand dollars ($2,000) per year received by Indians that is derived from individual interests in trust or restricted lands (per Public Law 103-66 section 13736, 92-203, and 100-241).

(d) Up to two thousand dollars ($2,000) per year received by Indians that is derived from individual interests in trust or restricted lands (per Public Law 111-291).

(e) Amounts received by an individual as a lump sum or a periodic payment via the Cobell settlement cannot be counted as income in the month received or as a resource for a one year period beginning with the date of receipt (per Public Law 111-291 section 101).

(7)Plans for achieving self-support: Income derived from, or necessary to, an approved plan for achieving self-support for a blind or disabled applicant/recipient under 65 years of age is excluded.

(a) For an applicant/recipient who is blind or disabled and over 65 years of age, this exclusion applies only if he/she received medicaid for the month preceding his/her 65th birthday.

(b) The self-support plan must be in writing and contain the following:

(i) designated occupational objective;

(ii) specification of any savings (resource) or earnings needed to complete the plan, such as amounts needed for purchase of equipment or for financial independence;

(iii) identification and segregation of any income saved to meet the occupational goal; and

(iv) designation of a time period for completing the plan and achieving the occupational goal.

(c) Plans for achieving self-support are developed by vocational rehabilitation counselors. If a self-support plan is not in place, the ISD worker makes a referral to the division of vocational rehabilitation (DVR).

(d) The ISD worker forwards the written plan and documentation to the MAD eligibility unit. The plan must be approved by that unit.

(e) An approved plan is valid for the following specified time periods:

(i) initial period of no more than 18 months;

(ii) extension period of no more than 18 months;

(iii) final period of no more than 12 months; and

(iv) total period of no more than 48 months.

(8)Agent orange settlement payments: Agent orange settlement payments made to veterans or their survivors are excluded from consideration as income in determining eligibility.

(9)Radiation Exposure Compensation Act payments: Payments made under the Radiation Exposure Compensation Act are excluded from consideration as income in determining eligibility.

(10)Remembrance, responsibility and the future foundation: Payments to individual survivors forced into slave labor by the Nazis are excluded.

(11)Victims compensation payments: Payments made by a state-administered fund established to aid victims of crime are excluded from consideration as income in determining eligibility.

(12)SSI lump sums for retroactive periods: Supplemental security income (SSI) lump sum payments for retroactive periods are excluded from consideration as countable income in the month received.

(13)Life insurance and other burial benefits: Life insurance and other burial benefits are unearned income to the beneficiary (not the owner). The ISD worker must subtract the amount spent on the insured individual's last illness or burial up to one thousand five hundred dollars ($1,500). Any excess is counted as unearned income.

(14)One hundred percent state-funded assistance payment: Any one hundred percent state-funded assistance payment based on need, such as general assistance (GA), is excluded. Any interim payments made by a state or municipality from all state or local funds while an SSI application is pending are excluded.

(15)ABLE ACT distributions: Distributions from an ABLE account are excluded as income of the designated beneficiary. Qualified disability expenses (QDEs) are expenses related to the blindness or disability of the designated beneficiary and for the benefit of the designated beneficiary. The following (QDEs) are excluded:

(a)Housing related QDEs: mortgages (including house insurance), real property taxes, rent, heating fuel, gas, electricity, water, sewer, and garbage removal.

(b)Non-housing related QDEs: education, transportation, employment training and support, assistive technology and related services, health, prevention and wellness, financial management and administrative services, legal fees, expenses for ABLE account oversight and monitoring, funeral and burial, and basic living expenses.

(c)Non-qualified expenses.

(d)QDEs for non-housing: Distributions for other non-housing expenses are excluded if retained beyond the month received in their current ABLE account if the distribution is identifiable and is intended to eventually be expended for non-housing costs.

(e)Non-qualified expenses: Not excluded under the ABLE Act are housing-related or other QDEs if retained by the beneficiary for two months.

N.M. Admin. Code § 8.215.500.20

2-1-95, 7-31-97; 8.215.500.20 NMAC - Rn, 8 NMAC 4.SSI.522, 3-1-01; A, 4-1-09, Adopted by New Mexico Register, Volume XXIX, Issue 04, February 27, 2018, eff. 3/1/2018