Medicaid Policy                                                                 

401-1 The MAGI Household

Effective Date: November 1, 2021

 

Previous Policy (234-1 was renumbered to 401-2 as of November 1, 2021)

 

A.   General Rules 

The first step to determine eligibility for MAGI-based coverage groups is to build the MAGI household for each applicant or recipient. The household composition rules follow federal tax rules, and in some cases, relationship rules.

 

·       The MAGI household is determined based on whether the applicant or recipient expects to file a federal tax return or not, and whether the person can be claimed as a dependent by another tax filer.

·       The MAGI household of a spouse of a tax filer is determined based on whether they file a joint return, and if filing separately who the spouse can claim as dependents.

·       The MAGI household size for children of the applicant or recipient depends on whether the children are claimed as dependents by a tax filer, who is claiming them, who they live with, and the relationships with household members.

·       The MAGI household of other dependents of a tax filer is based on the relationships of the people those dependents live with.

·       The MAGI household for individuals who will neither file a tax return nor be claimed as a dependent by another tax filer will be determined based on the relationships of the people living in the household. 

B.   Applicant and Recipient Requirements 

 

1.       An applicant or recipient must declare whether they intend to file a federal tax return for the year in which Medicaid eligibility is being determined, and whether the person can be claimed as a dependent by another tax filer.

2.       If the individual expects to file a tax return and cannot be claimed as a dependent, the individual must state:

a.       who they expect to claim as dependents and the relationships of those individuals whom they are claiming

b.       who lives in the home and their relationship to those individuals, and

c.       any anticipated changes in the coming tax year.

3.       If a tax filer expects to claim a relative who is not a dependent child or who is an unrelated individual, the tax filer may need to verify the reason that person can be claimed as a dependent if the information the agency receives conflicts with the client's statement.

4.       If an applicant does not intend to file a tax return, the individual must declare who lives in the home and the relationship of those individuals. 

5.       Household size is determined separately for each individual applying for benefits.

The following sections define how to determine household size for tax filers, dependents and non-tax filers.