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West Virginia Income Maintenance Manual Chapter 3

West Virginia Income Maintenance Manual Page 51 Chapter 3 Eligibility Determination Groups

3.7.2 THE MAGI HOUSEHOLD INCOME GROUP (IG) Income of each member of the individual’s MAGI household is counted. The income group is determined using the MAGI methodology established in Section 3.7.3. EXCEPTION: Income of children, or other tax dependents, who are not expected to be required to file an income tax return is not counted, whether or not the individual actually files a tax return.

NOTE: A reasonable determination as to whether an individual will be required to file a tax return can be made based on the individual’s current income for the applicable budget period. Such a determination would be based on information available at the time of application or renewal. Information regarding “Who Must File” a tax return can be found in Appendix G of Chapter 4. 3.7.2.A Examples of Applying the Income Rules for Children and Tax Dependents Child’s Income Excluded Example: A child is 17 years old with a part-time job in the summer and earns $2,100. He is expected to be claimed as a dependent on his parent’s tax return. It is determined at application that the child is not expected to be required to file taxes the following year because his income does not exceed the filing requirements established by the IRS. Therefore, the child’s income will not be included in the MAGI household or count toward eligibility whether he actually files taxes or not. Child’s Income Included Example: A child is 18 years old and works part time through the summer and after school. He earns $7,200 for the year. It is determined at application that he is expected to be claimed as a dependent on his parent’s tax return and will be required to file an income tax return for the year in which Medicaid is being sought. Therefore, this child’s income will be included to determine eligibility for any MAGI household for which he is a member. Tax Dependent’s Income Example 1: Blossom is 60 years old and lives with her 40-year-old daughter. Blossom will be claimed as a tax dependent on her daughter’s taxes next year. Blossom receives $960 Social Security income per month; she has no other income. Because Blossom has no other income, her Social Security income is not taxable, and she is not required to file taxes. As her daughter’s tax dependent, her income does not count toward her daughter’s MAGI household.