Net countable income is determined by applying the following disregards to countable income: A disregard of $85 plus 1/2 of the remaining earned income in any month is deducted from the total earned income as described in Regulation .07B(1) and (2) of this chapter of an individual who has no unearned income; A disregard of $20 is applied to the unearned income of an individual who has only unearned income; or A disregard of $20 in addition to a disregard of $65 plus 1/2 of the remaining earned income in any month is deducted from the total earned income of a person who has both earned and unearned income. A disregard equal to the cost of care is applied to the income of residents of MDH rehabilitative residences.