443-3        EXPENSES OF OBTAINING UNEARNED INCOME

443-3 A.   TREATMENT OF ESSENTIAL EXPENSES

Unearned income does not include that part of a payment which is for an essential expense incurred in getting the payment(s).  Amounts remaining after essential expenses have been subtracted are considered as unearned income.

• Legal, medical, or other expenses connected with an accident may be subtracted from any payment(s) received for damages in connection with the accident.

• Legal fees essential to obtaining benefits from a benefit program (such as Workmans' Compensation payments) other than SSISupplemental Security Income may be subtracted from a retroactive check issued by that program.

Verification.  

To be excluded from income, essential expenses of obtaining income must be verified.  Acceptable evidence includes bills, receipts, pay stubs, contact with the provider, etc.  If an expense has been incurred but not paid, assume that the individual will pay the expense unless there is reason to question the situation.

443-3 B.   HOW ESSENTIAL EXPENSES ARE DEDUCTED

Deduct expense money from the first and any subsequent amounts of related income until all expenses are completely eliminated.

443-3 C.   EXPENSE MONEY ASSUMPTIONS

Assume that the following payments for expenses do not exceed the expenses and thus do not result in income.  It is not necessary to verify the expenses listed below or follow up on how the money was spent.  Such payments are assumed to be used in their entirety to meet expenses.

• Payments by a government agency for expenses related to a service or participating in a program (for example, per diem expense money provided to jurors).

• Lump sum advances or reimbursements by employers to cover expenses of employment paid by the employee (for example, a per diem allowance paid to an employee, or a $100 allowance paid to a school bus driver to pay for gas and maintenance).