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DETERMINING NET INCOME

ISSUE DATE: 11/2016

Determine a client's net income by subtracting deductions and disregards from gross income. See 0017 (Determining Gross Income).

Use net income to determine a client's eligibility and level of benefits. See 0022.12 (How to Calc. Benefit Level - MFIP/DWP/GA), 0022.12.01 (How to Calculate Benefit Level - SNAP/MSA/GRH), 0020 (Net Income Limits).

Subtract disregards and deductions in the specific order below to determine net income.


MFIP:

Apply an initial income test as noted in program provisions below.

Determine net income for the initial income test by adding gross earned income, unearned income and deemed income, then subtract the following deductions in the order listed:

1.

Earned income disregard. See 0018.18 (Earned Income Disregards).

2.

Allocations. Apply allocations against earned income first. Apply any remaining allocation amount against unearned income. See 0018.30 (Allocations).

3.

Actual dependent care costs up to the maximum allowance from earned income. See 0018.09 (Dependent Care Deduction).

4.

Child and spousal support deductions. See 0018.33 (Child and Spousal Support Deductions).


If net income (after allowing the deductions above) is less than the Family Wage Level, determine the benefit level using the appropriate assistance standard. See 0020.09 (MFIP/DWP Assistance Standards).

Compute net income EACH MONTH to use in determining benefits by subtracting the following deductions from gross earned and unearned income, including deemed income in the order listed:

1.

Earned income disregard. See 0018.18 (Earned Income Disregards).

2.

Allocations. Apply allocations against earned income first. Apply any remaining allocations amount against unearned income. See 0018.30 (Allocations).

3.

Child and spousal support deduction. Apply this deduction against any remaining earned income. Apply any remaining amount of the deduction against unearned income. See 0018.33 (Child and Spousal Support Deductions).


After you apply these deductions, follow the procedures in 0022.12 (How to Calc. Benefit Level - MFIP/DWP/GA). If the MFIP grant you compute using this procedure is $0 or less (because the unit's income exceeds the standard), the unit is not eligible.


DWP:

Follow MFIP for the initial income determination. Then compare the net need for the DWP grant to the CASH portion of the appropriate Assistance Standard.

The minimum cash benefit amount is $10, if income and asset tests are met. Do not vendor pay benefits of $10.

In most cases once the grant amount is determined, if the participant obtains a job or receives additional earned income, or unearned income, the income is NOT used to reduce the unit’s DWP benefits. See 0022.12 (How to Calc. Benefit Level - MFIP/DWP/GA) for more information.


SNAP:

For all units:

1.

Farm loss offset. See the SNAP Farm Loss Offset Policy Guide (PDF).

2.

Work expense deduction. See 0018.06. (Work Expense Deductions).

3.

Standard disregard. See 0018.21 (Standard Disregard).

4.

Dependent care deduction. See 0018.09 (Dependent Care Deduction).

5.

Medical deduction. See 0018.12 (Medical Deductions).

6.

Shelter deduction. See 0018.15 (Shelter Deductions).

7.

Child support deduction. See 0018.33 (Child and Spousal Support Deductions).



MSA:

For clients who are SSI recipients, subtract $20 from the amount of the client's full SSI Federal Benefit Rate (FBR). EXCEPT, do not allow the $20 disregard for SSI recipients living in a long term care facility (LTCF) who have their cost of care paid by MA. See 0029.06.03 (Supplemental Security Income Program).


For clients not getting SSI who live in an LTCF and have their cost of care paid by MA:

1.

Guardianship fees to a legally-appointed guardian or conservator. Allow up to 5% of the client's monthly gross income to a maximum of $100.

2.

Allocations. See 0018.30 (Allocations).



For all other clients:

1.

Earned income disregard for blind or disabled student children. See 0018.18 (Earned Income Disregards).

2.

Standard disregard. See 0018.21 (Standard Disregard).

3.

The 1st $65 of the earned income disregard. See 0018.18 (Earned Income Disregards).

4.

Work expense deduction for disabled clients. See 0018.06 (Work Expense Deductions).

5.

One-half the remaining earned income. See 0018.18 (Earned Income Disregards).

6.

Work expense deduction for blind clients. See 0018.06 (Work Expense Deductions).

7.

Income used to fulfill an approved Plan to Achieve Self-Support (PASS) for disabled or blind people. See 0018.06.06 (Plan to Achieve Self-Support (PASS)).



GA:

See 0018.18 (Earned Income Disregards).


GRH:

See 0018.01 (Determining Net Income - GRH).

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