Net income from rental property owned by a client is considered unearned income if the client has no specific responsibility for management of the property or capital investment. For example, when a rental agency or trustee handles all of the
management duties relating to the property and forwards the money to the client, the rental income is unearned. Reasonable and necessary rental expenses that are incurred in the production of income are allowed when determining net income
(see PM 08-01-02-a).