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B. Federal Income Tax Deduction Standards

Federal Tax Deductions are amounts excluded from the gross income for MAGI-budgeted determinations. This includes Elderly and Disabled determinations that use reasonable compatibility to verify income. It is not applicable to Long Term Care, Working Healthy, or MediKan. Deductions up to the maximum amount that tax law allows can be deducted. This yearly cap is converted to a monthly amount in the chart below.

Federal Tax Deduction Limits - Updated 04/01/2026 Federal Tax Deduction Monthly Limit Alimony Paid N/A* Only deductible for agreements executed prior to 1/1/2019 Business Expense N/A* Domestic Production Activity N/A* Educator Expenses $29.16 The Health Savings Account Deduction $729.17 IRA Deduction (Under Age 50) $625 IRA Deduction (Between Age 50 and 70.5) $716.67 IRA Deduction (Over Age 70.5) N/A* Moving Expenses Not currently allowable except for some active military Penalty on Early Withdrawal of Savings N/A* Self-Employed SEP, SIMPLE and Qualified plans (self-employed and clergy) $6000 Self-employed Health insurance N/A* Student Loan Interest $208.33 Tax Deduction Portion of the Self-Employment Tax N/A* Tuition and Fees Not currently allowable

Note: Federal tax deductions apply to both MAGI and Non-MAGI programs but do not apply to Long Term Care, Working Healthy, or MediKan. Federal Tax Deduction Limits are based on the tax law. Common Federal tax deductions are listed; however, this list is subject to change.

*N/A indicates that there is not currently a cap for this type of deduction though it is still allowable.