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Manual Title Chapter Page Revision Date Virginia Medical Assistance Eligibility M04 July 2024 Subchapter Subject Page ending with Page M04 MODIFIED ADJUSTED GROSS INCOME (MAGI) M0450.100 21

B. Determine the MA Income for Each Member of the Household 1. Is Any Household Member The Child Or Expected Tax Dependent Of Another Member Of The Household? a. If yes - is the individual expected to be required to file a tax return? 1) If yes, continue to Step 2 and include child’s income in total household income. 2) If no, continue to Step 2, but do not include child’s income in total household income. b. If no, continue to Step 2. 2. Determine MAGI Income For Each Member Determine MAGI-based income of each member of the individual’s household, unless income of such member is flagged as not being counted in step 1. Recall that, for purposes of MA eligibility, the following rules apply: • An amount received as a lump sum is counted as income only in the month received. • Scholarships, awards or fellowship grants used for education purposes and not for living expenses are excluded from income. • Certain distributions, payments and student financial assistance for American Indians/Alaska Natives are excluded from income. • Child support is not countable income. • Social Security benefits received by a child are not countable for his eligibility when a parent is in the household, unless the child is required to file taxes. • Interest paid on student loans is deducted from income. • Foreign income and interest, including tax-exempt interest, are counted. 3. Using the 5% of FPL Disregard If the individual’s household income is over the income limit for his covered group, subtract an amount equal to 5% of FPL for his household size (see M04, Appendix 1). Compare the countable income against the income limit for the individual’s covered group to determine his income eligibility. If the individual meets multiple Medicaid covered groups (and/or FAMIS) his gross income is compared first to the income limit of the full-benefit covered group with the highest income limit for which the individual could be eligible. If the income exceeds the limit, subtract 5% FPL based on his household size and compare the income again to the income limit. If still not eligible, the same process is followed for Plan First, if the individual is age 19 through 64 years. C. Household Income Household income is the sum of the MAGI-based income for every member of the individual’s household as determined in step 2 above.