MAGI-related MA household composition is determined based on federal tax rules with some exceptions. When the CAO determines eligibility for MAGI-related MA, the CAO must first determine tax filing status and tax relationships between the individuals in the household.
If the individual does not answer tax questions on the application or renewal form, the tax relationships are considered unknown. The CAO will use non-filer rules to determine eligibility for MAGI MA.
NOTE: If the CAO completes an interview for other benefits at application or renewal, the caseworker will determine the tax filing relationships during the interview if they are not listed on the application or renewal form.
Individuals who receive MA in either MAGI- related categories or non-MAGI related categories are included in the MAGI determinations of other members of the household if they have a tax relationship to the individual being evaluated for MAGI - related MA.
NOTE: When determining eligibility for a household which includes a pregnant woman, the pregnant woman is counted as herself plus the number of children she is expected to deliver.
Each applicant’s eligibility is based on one of three tax filing statuses:
Tax Filer - an individual who plans to file taxes for the current tax year.
Tax Dependent - an individual who is claimed as a tax dependent by someone who plans to file taxes.
NOTE: An individual who is both a tax dependent and a tax filer will be considered a tax dependent.
NOTE: The terms Tax Filer and Tax Dependent always refer to the expected status for the current coverage year, and not to any prior filing status.
Non-Filer - an individual who is not a tax filer and not a tax dependent.
Individuals who do not live in the applicant's household but have a tax relationship with anyone in the household are recognized as an Outside of the Household (OOTH) individual. An OOTH is included when determining a MAGI household if:
An OOTH:
has a tax-relationship to an applicant
does not live in the household
cannot be an applying member of the household
cannot be a payment name of the case
Though an OOTH is considered part of the individual's household for MAGI purposes, the OOTH and their income may not count toward the MAGI-related determination. See Section 312.22, MAGI Filer/Non-Filer rules for Household Composition.
When determining eligibility for individuals who are tax filers and tax dependents, MAGI Rules for household composition are as follows.
Tax Filer Rules for Household Composition
The household composition of a tax filer is:
The tax filer.
All of the tax filer’s claimed dependents, and
The tax filer’s spouse, if living with the tax filer.
NOTE: Married couples living together will be included in the household of the other spouse regardless of whether they expect to file a joint tax return.
Exceptions to Tax Filer Rules:
If the information the tax filer provides is questionable and the filer cannot provide proof of their tax dependents, then the household is determined by non-filer rules.
Example: Anne (age 49) states on her application that she will claim her daughter, Susan (age 28), and her son, Ian (age 15), on her tax return. Due to Susan’s age, the CAO can request that Anne provide proof that she claims Susan as a tax dependent. If Anne does not provide proof, the CAO will use non-filer rules to determine Anne’s MAGI household.
Tax Dependent Rules for Household Composition
The household composition of a tax dependent is:
The tax dependent.
The tax dependent’s tax filer.
The spouse of the tax dependent's tax filer, if living with the tax filer.
All other tax dependents of the tax filer.
The tax dependent’s spouse, if living with the individual.
NOTE: Spouses cannot be tax dependents of each other.
Exceptions to Tax Dependent Rules:
If the individual is claimed as a tax dependent by someone other than a spouse or a parent (biological, adoptive or step), the individual’s household composition is determined by non-filer rules.
Example: Emily and Jacob have legal custody of their grandson, Andrew (age 8). Emily and Jacob claim Andrew as their Tax Dependent. Andrew’s MAGI household composition will use Non-Filer rules and will include Andrew only.
If a child under age 19 lives with both parents, but both parents do not expect to file taxes jointly and only one parent claims the child as a tax dependent, the child’s household composition is determined by non-filer rules.
Example: Maria and Jorge are not married but are living together and are the parents of Brian (age 4). Maria and Jorge will not file taxes jointly and Maria will claim Brian as a Tax Dependent. Brian’s MAGI household composition will use Non-Filer rules and will include Brian, Maria and Jorge.
If a child under age 19 is claimed as a tax dependent by non-custodial parents, the child’s household composition is determined by non-filer rules.
Example: James and Caitlin are divorced and do not live together. Caitlin has primary physical custody of their son, Rob (age 10) James claims Rob as a tax dependent. Rob’s MAGI household composition will use Non-Filer rules and will include Rob and Caitlin. Though James is an OOTH, he will not be counted in the MAGI household since the Non-Filer rules will be used.
If a child under age 19 is claimed as a tax dependent by their parents who are married and who will file taxes jointly but one parent lives outside of the household due to separation or pending divorce, the child’s household composition is determined by non-filer rules. The parent living outside of the household will not be counted in the budget.
Example: Frank and Laura are married and will file taxes jointly, claiming their son, Derrick (age 9). Frank and Laura are separated, pending a divorce, and Frank is living outside of the household. Derrick’s MAGI household will be Laura and Derrick only. Though Frank is an OOTH, he is not included in the MAGI household since Non-Filer rules will be used.
Example: Steve and Meg are married and will file taxes jointly, claiming their children Hailey and Stan (ages 3 and 6). Steve works for a trucking company and lives out of town Monday through Friday each week. Steve's permanent address is his residence with his family and he returns home each weekend. Steve is not an OOTH. Steve is counted in the MAGI household, and tax filer/tax dependent rules are used.
Non-Filer Rules for Household Composition
When determining eligibility for individuals who are not tax filers and not tax dependents, the Non-Filer Rules for household composition are followed.
The household composition of an adult (age 19 and above) non-filer is:
The non-filer.
The non-filer’s spouse who lives in the household.
The non-filer’s biological, adoptive or step-children under the age of 19 who live in the household.
If a child (under age 19) is a target whose eligibility is being determined under non-filer rules, the child’s
household composition includes:
The child.
The child’s biological, adoptive or step parents who live in the household.
The child’s biological, adoptive, half or step siblings under the age of 19 who live in the household.
The child's spouse if living in the household.
The child's biological, adoptive or stepchildren who live in the household.
Exceptions to Non-Filer Rules:
If a child under age 19 is considered a non-filer and is also considered emancipated, the child's parents and siblings under the age of 19 (if they live with the child) will not be included in the child's determination.
Updated April 17, 2024, replacing June 8, 2020