[Code of Federal Regulations]
[Title 20, Volume 2]
[Revised as of April 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 20CFR418]

[Page 1188-1189]
 
                      TITLE 20--EMPLOYEES' BENEFITS
 
               CHAPTER III--SOCIAL SECURITY ADMINISTRATION
 
PART 418_MEDICARE SUBSIDIES--Table of Contents
 
                   Subpart D_Medicare Part D Subsidies
 
Sec.  418.3340  How do we count your unearned income?

    (a) When income is received. We count unearned income as available 
to you at the earliest of the following points: when you receive it, 
when it is credited to your account, or when it is set aside for your 
use.
    (b) When income is counted. For purposes of determining eligibility 
and whether you should receive a full or partial subsidy, we consider 
all of the countable unearned income you and your living-with spouse 
receive (or expect to receive) during the year for which we are 
determining your eligibility for this benefit. However, in the first 
year you or your spouse apply for the subsidy, we consider all of the 
countable unearned income both you and your living-with spouse receive 
(or expect to receive) starting in the month for which we determine 
eligibility for you or your living-with spouse based on an application 
for the subsidy. If we count your income for only a portion of the year, 
the income limits for subsidy eligibility will be adjusted accordingly. 
For example, if we count your income for 6 consecutive months of the 
year (July through December), the income limit for subsidy eligibility 
will be half of the income limit applicable for the full year.
    (c) Amount considered as income. We may include more or less of your 
income than you actually receive.
    (1) We include more than you actually receive where another benefit 
payment (such as a social security benefit) has been reduced to recover 
an overpayment. In such a situation, you are repaying a legal obligation 
through the withholding of portions of your benefit amount, and the 
amount of this withholding is part of your unearned income.
    (2) We also include more than you actually receive if amounts are 
withheld from unearned income because of a garnishment, or to pay a debt 
or other legal obligation, or to make any other payment such as payment 
of your Medicare premiums.
    (3) We include less than you actually receive if part of the payment 
is for an expense you had in getting the payment. For example, if you 
are paid for damages you receive in an accident, we subtract from the 
amount of the payment your medical, legal, or other expenses connected 
with the accident. If you receive a retroactive check from a benefit 
program, we subtract legal fees connected with the claim. We do not 
subtract from any taxable unearned income the part you have to use to 
pay personal income taxes. The payment of taxes is not an expense you 
have in getting income.
    (d) Retroactive benefits. We count retroactive monthly benefits such 
as social security benefits as unearned income in the year you receive 
the retroactive benefits.
    (e) Certain veterans benefits. If you receive a veterans benefit 
that includes

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an amount paid to you because of a dependent, we do not count as your 
unearned income the amount paid to you because of the dependent. If you 
are a dependent of an individual who receives a veterans benefit and a 
portion of the benefit is attributable to you as a dependent, we count 
the amount attributable to you as your unearned income if you reside 
with the veteran or you receive your own separate payment from the 
Department of Veterans Affairs.
    (f) Social Security cost-of-living adjustment. We will not count as 
income the amount of the cost-of-living adjustment for social security 
benefits for any month through the month following the month in which 
the annual revision of the Federal poverty guidelines is published.