Page 154

Child Care Assistance Program Policy Manual Issued 02/2023 Annualizing income 6.15 Annualize income to determine eligibility. Annual income of the applicant family is the current monthly income of the family multiplied by 12, income for the 12-month period immediately preceding the date of application or income calculated by the method which provides the most accurate assessment of income available to the family. Income components to consider when annualizing income The individual components needed within MEC2 will vary depending upon the type of income. The income components used in MEC2 include: • Payment Frequency: Identifies how often the income is paid to the family member. • Income Projection Amount: Identifies the amount to be used by MEC2 in the annualized income calculation. • Income Projection Payment Frequency: Identifies the payment frequency to be used by MEC2 in the annualized income calculation. • Income Projection Hours per Week: Identifies the hours per week to be used by MEC2 in the annualized income calculation if necessary. Not all annualized income calculations require the hours per week. Most often the Payment Frequency and Income Projection Payment Frequency periods will be the same. How does MEC² annualize income? There are several methods MEC2 uses to annualize income. Generally, the worker should enter the verified individual income components, and MEC2 will calculate the annualized income. Annualize income using the verification and method that is the best indicator of future income. MEC2 uses the following multipliers to annualize income: • Multiply a weekly income projection payment frequency by 52. • Multiply a biweekly income projection payment frequency by 26. • Multiply a semimonthly income projection payment frequency by 24. • Multiply a monthly income projection payment frequency by 12. If the individual income component information entered into MEC2 is not supported by the verification information, it is recommended that the worker include a detailed case note describing the relationship between the individual income components and the verification information. Annualizing expected future income at application When a family applies for CCAP and has income starting in a future biweekly period, there are two acceptable methods to annualize the income. Using one of these methods ensures application policies are correctly applied and allows the copay to increase with the application approval. Treat all families in similar situations the same.