§ 4310.13. Determining legally liable relative monthly liability.
The extent of a LLR’s liability for costs of services provided to clients over and above that paid by third-party payors, other agencies, or the client is based on discretionary income and determined from the table in Appendix A. The monthly LLR liability is determined by the following assessment method. The assessment must be completed on the PW-833.
(1) Determining gross income.
(i) Income must be verified using the most recent Federal tax 1040 forms. If Federal tax forms are not available, the W-2 or three recent pay stubs may be used. However, LLR’s are required to present their Federal Income 1040 tax forms at the next Federal income tax filing period.
(ii) Determine the total annual earned income of the household. To the earned income figures, add any interest, dividends, benefits, alimony, or child support payments received by the LLR during the preceding 12 months. The sum of all earned and nonearned income is the gross annual income. The following policies apply to the determination of gross income:
(A) Earned income is the sum of all wages, salaries, fees, commissions, tips, bonuses, net rental income before deductions for taxes, insurance, tax sheltered annuities or other income.
(B) Interest income includes interest received from accounts with banks, money market funds, credit unions or bonds that are paid to the LLR.
(C) Dividends received from corporate stock holdings or life insurance policies are counted as income.
(D) Capital gains from any source.
(E) Benefits including, but not limited to, unemployment compensation, OASDI payments, pensions, black lung benefits, railroad retirement, and the like, are counted as income.
(F) Benefits of a LLR that are specifically restricted to his own personal use, such as veteran’s pensions or Social Security benefits shall be considered only for his own support and must be disregarded for the purpose of supporting the client.
(iii) Alimony and support payments are counted as income when determining gross income.
(A) If there is a court-supervised settlement or agreement regarding payment for medical care costs for the client, liability is only assessed against the spouse or parent having responsibility for these costs.
(B) If the court order specified that the first spouse or parent is liable for medical costs up to a given dollar amount, the second spouse or parent remains liable up to the second spouse’s or parent’s maximum liability, but liability may not exceed the amount assessed the first spouse or parent under court order.
(C) If there is no court-supervised separation or divorce agreement, the income of both spouses or parents is considered assessable up to the maximum liability. If a child is a client and if the parent with whom the child is not residing refuses to provide information or income amounts, liability of the parent with whom the child resides is limited to the maximum liability based on the one parent’s income. The other parent refusing to provide information or income amounts is liable for the full cost of care up to the maximum liability over and above the charges paid by the parent with whom the child resides.
(D) Services may not be discontinued to a child because of nonpayment by the noncustodial parent.
(2) Determining discretionary income.
(i) Discretionary income is the amount of monies available to the household after all deductions permitted by this chapter have been computed. To determine the amount of discretionary income available, deduct:
(A) State and Federal income taxes actually paid, mandatory payroll deductions including Social Security, local taxes, wage and work privilege taxes, union dues and contributions to mandatory retirement plans.
(B) Health insurance premiums not included in clause (D). Life insurance premiums are not deductible.
(C) Reasonable and verified child care costs.
(D) Verified medical expenses, including health insurance premiums, not included in clause (B), exceeding 5% of gross annual income.
(E) A living allowance of $6,000 per household, plus an additional $1,000 per dependent. Real estate taxes on the home residence are deductible if paid currently.
(ii) When all deductions have been subtracted from the gross annual income, the remainder is discretionary income.
(3) Monthly LLR liability assessment.
(i) After the discretionary annual income amount has been determined, turn to Appendix A to determine the appropriate liability assessment.
(ii) Compare the annual discretionary income amount to Appendix A. The amount of monthly liability is charted beside the annual discretionary income level.
(4) Determining the size of the household.
(i) A household consists of the head of household, and other household members including:
(A) The spouse of the head of household, unless the spouse is separated or divorced from the head of household and the head of household is paying less than 50% of the cost of support of that spouse.
(B) Any children under 18 years of age related by blood, marriage, or adoption whom the head of the household has a legal duty to support, or other dependents as defined by the IRS dependency criteria.
(C) A child under 22 years of age who is a student regularly attending school, college, or university, or a course of vocational or technical training designed to prepare him for gainful employment, is counted as a household member if the head of household is responsible for at least 50% of his support.
(ii) When the size of the household is determined, that information is used to determine the dependency allowance under paragraph (2)(i)(E).
Source The provisions of this § 4310.13 adopted December 3, 1982, effective December 4, 1982, 12 Pa.B. 4149; corrected January 21, 1983, effective December 4, 1982, 13 Pa.B. 523.
Cross References This section cited in 55 Pa. Code § 4310.18 (relating to debt payments not included when considering liability abatement/modification requests).
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