Prior to receiving Program benefits, each recipient whose family income exceeds 175 percent of the federal poverty income guidelines shall be required to pay an annual fee equal to the sum of: 5 percent of the amount by which the sum of the recipient’s adjusted gross income as defined in the Internal Revenue Code for federal income tax purposes plus Social Security benefits and tier 1 railroad retirement benefits not otherwise included in the recipient’s gross income under § 86 of the Internal Revenue Code exceeds 175 percent of the federal poverty guidelines adjusted for family size; and 5 percent of the value of the recipient’s liquid assets above 200 percent of the federal poverty guidelines adjusted for family size. The annual fee required under paragraph (1) of this subsection shall be collected quarterly by the Department. A recipient is required to submit copies of the most recent tax returns of the recipient and of persons in the recipient’s family. The Department shall provide recipients with a grace period after the deadline for a fee payment. A recipient who has not paid overdue fees by the end of the grace period shall be terminated from the Program. The Department shall extend the grace period in an appropriate hardship case.