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Families and Children Manual Policy Manual Number: 010.020 Section: Financial Eligibility Chapter: Countable and Excluded Income
September 1, 2026 Division of Tenncare 15 All contributions and ABLE account earnings in an ABLE account are excluded as income, except that contributions are not deducted from countable income of the individual making the contribution. Contributions to an ABLE account from a third party are not countable as income. This includes funds from a trust. Distributions from an ABLE account are not income of the designated beneficiary in any month, regardless of whether the distribution is for non-housing QDEs or housing QDEs. Distributions which exceed the QDEs incurred by the account beneficiary in a taxable year are countable income.
b. Adoption Subsidies Payments to an individual from state adoption assistance programs or Title IV-E funds for special needs children are excluded. c. Child Support A payment that is specifically designated as child support or treated as specifically designated as child support under a divorce or separation instrument is not alimony. The amount of child support may vary over time. Child support payments made to a child under court order are excluded. d. Child Support Arrearage Child support arrearages received, whether received on a regular monthly schedule or as a one- time payment are excluded. e. Child Tax Credit Child Tax Credit payments received either as monthly advance payments or a one-time refund are excluded. f. Combat Pay A combat zone is any area the President of the United States designates by Executive Order as an area in which the U.S. Armed Forces are engaging or have engaged in combat. Payments made to an individual serving active duty in a combat zone are excluded entirely or in part depending on rank. All combat pay is excluded for enlisted members, warrant officers, or commissioned warrant officers. Combat pay is excluded for commissioned officers (other than commissioned warrant officers) up to the highest rate of enlisted pay plus imminent danger/hostile fire pay received for each month.