E-3200, Types of Unearned Income

Revision 16-2; Effective June 1, 2016

Unearned income is any income that is not earned. Unearned income may be in cash or in-kind. Unearned income includes these types of income:

  • In-kind
  • Fixed
  • Other

Income tax refunds are subject to restitution policy (in the month of receipt) for co-payment purposes, to the extent that withholding tax was not included in the co-payment budget.

To determine the amount of unearned income, consider the amount actually available to the person. Reduce the gross amount by any ordinary or necessary expenses incurred in receiving the unearned income. For example, compensation for damages incurred in an accident would be the settlement amount less any legal, medical or other expenses. Medicare premiums, other health insurance premiums and income tax withheld from unearned income are not deductible expenses for eligibility determination. Income tax withheld from unearned income is also not a deductible expense for the co-payment calculation.