44-260 H. AR/CO Budgeting Examples

 

Table of Contents

Section

Topic

44-260.H.1

Contract Income

44-260.H.2

Budgeting Income using a Conversion Factor

44-260.H.3

New Income

44-260.H.4

Changing Income

44-260.H.5

Fluctuating Income

44-260.H.6

Unstable Income

44-260.H.7

Questions and Answers

CPG Letters 284 (3/13); 309 (1/14)

 

44-260.H.1
Contract Income

Example 1:  Contract Income for CalWORKs/CalFresh

Scenario

During a July CalWORKs/CalFresh annual redetermination/recertification, the recipient reports her part-time job at school ended in mid-June.

Review of the individual’s employment history shows there is always a break in employment during the summer months.

The recipient clarifies there is no work because the school is closed during summer vacation.  She expects to resume her job when the new school year begins in September.

The recipient verifies that she receives a total income of $7,200 from this job for the entire school year (September – June).

Outcome

The average monthly income for the 12-month AR/CO period will be calculated as follows:  $7200 / 12 months = $600/mo.

$600 will be used as the budgeted monthly income for the upcoming AR/CO period.

ACL 12-49

 

44-260.H.2
Budgeting Income using a Conversion Factor
Top

Example 2:  Budgeting Income using a Conversion Factor

Scenario

During the annual redetermination, a recipient reports biweekly part-time earnings.

Verification of the current income is provided:  The recipient receives $150 and $250, paid every other Wednesday.

The verification indicates that these amounts are paid regularly and that the income is anticipated to continue for the upcoming AR/CO period.

Outcome

Since the income is paid biweekly, the 2.167 conversion factor will be used.

The average monthly income will be calculated as follows:  $150 + $250 = $400. $400 / 2 checks = $200 x 2.167 = $433.40/month.

$433.40 will be used as the budgeted monthly income for the upcoming AR/CO period.

ACL 12-49

 

44-260.H.3
New Income

Example 3:  New Income Reported

Scenario

At a September CalWORKs redetermination, a recipient reports that a new job will start in November.  The AU currently has no income.

The recipient provides employment verification confirming that the new job will pay $500/month and the first pay check will be issued on the first Friday of December.

The verification also confirms that this is a long-term assignment and the recipient anticipates this income will continue for the upcoming AR/CO period.

Outcome

For Month 1 (October) and Month 2 (November) of the upcoming AR/CO period, no income will be used in the benefit determination.

Effective Month 3 (December) and ongoing, $500 will be used in the benefit determination.

Timely and adequate notice is required for benefits to be decreased effective December.

 

Example 4:  New Income over IRT Reported

Scenario

During the CalWORKs annual redetermination, a recipient provides verification of earnings from a temporary job.

The current income is over the IRT for their AU size.

The recipient provides verification that the job assignment will end in four months.

Outcome

CalWORKs will discontinue with timely and adequate notice because the current income is over the IRT.

ACL 12-49

 

44-260.H.4
Changing Income
Top

Example 5:  Changing Income Reported

Scenario

At a February CalWORKs annual redetermination, a recipient reports current income is $300/month from a part-time job.

The recipient anticipates that this income will continue for several months.

Employment verification is provided that indicates the part-time earnings are expected to gradually increase over the next year as follows:

March - July:  $300/month

August – October:  $400/month

November – February:  $500/month

Outcome

Since the gradually increasing income is reasonably anticipated, it is not appropriate to average the income in this example.

For Month 1 (March) – Month 5 (July), $300 will be used as the budgeted income.

For Month 6 (August) – Month 8 (October), $400 will be used as the budgeted income.

For Month 9 (November) – Month 12 (February), $500 will be used in the budgeted income.

Timely and adequate notice is required before benefits are decreased effective August and November.

ACL 12-49

 

44-260.H.5
Fluctuating Income

Example 6:  Fluctuating Income Reported

Scenario

During the CalWORKs redetermination, a recipient reports current income of $300/month from part-time employment.

The recipient states he may earn as much as $350 in one month or as little as $275 another month and cannot predict how much will be received.

The client agrees that $300/month is typically received.

Outcome

The current income ($300) will be used as the budgeted monthly income for the upcoming AR/CO period since it reflects the amount that can be reasonably anticipated.

 

Example 7:  Fluctuating Income Reported

Scenario

A recipient has non-exempt fluctuating earned income.

It is determined that a minimum of $200/month is earned by working part-time.

Outcome

If the recipient agrees that at least $200/month is expected to be received for the upcoming AR/CO period then $200 will be used to determine benefits.

ACL 12-49

 

44-260.H.6
Unstable Income
Top

Example 8:  Unstable Income Reported

Scenario

A recipient reports weekly earnings during the annual redetermination.

Verification provided shows the current income as:  $150, $200, $75, and $130.

The recipient states his/her work hours change each week and the income amount cannot be anticipated for future months.

Outcome

Clarification will be needed to determine if there is a minimum income amount that the recipient can anticipate receiving for future months.

If no minimum income amount is established, then the weekly conversion factor will not be used.

If a minimum income amount can be determined then the weekly conversion factor will be used to calculate an average monthly income.

ACL 12-49

 

44-260.H.7
Questions and Answers
Top

Additional information and clarification may be found in CPG 45-000.BAnnual Reporting/Child Only (AR/CO) Q&A.

ACL 13-28