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West Virginia Income Maintenance Manual Chapter 4

West Virginia Income Maintenance Manual Page 152 Chapter 4 Income

4.7.1.A Examples of Applying the Income Rules for Children and Tax Dependents Child’s Income Excluded: A child is 17 years old with a part-time job in the summer and earns $2,100 annually. 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 Internal Revenue Service (IRS). Therefore, the child’s income will NOT be included in the MAGI household nor count toward eligibility, whether he actually files taxes or not. Child’s Income Included: A child is 18 years old and works part-time through the summer and after school. He earns $12,500 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 for determining eligibility for any MAGI household for which he is a member. Tax Dependent’s Income Excluded: Mrs. Basswood is 60 years old and lives with her 40-year-old daughter. Mrs. Basswood will be claimed as a tax dependent on her daughter’s taxes next year. Mrs. Basswood receives $960 Social Security income per month; she has no other income. Because Mrs. Basswood 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. Applicant’s Income Included: Same situations as above. Mrs. Basswood is also applying for health coverage. Her MAGI household will include only herself, using non-filer MAGI household size rules in Chapter 3. Because Mrs. Basswood is neither a child nor a tax dependent in her own MAGI household, her income will count toward determining her MAGI eligibility. 4.7.2 CALCULATING MAGI (WHAT INCOME IS COUNTED) MAGI-based income includes: • Adjusted gross income (taxable income less deductions/adjustments), excluding: o Certain taxable American Indian/Alaska Native income o Taxable scholarships/awards used for educational purposes