Revised August 15, 2016
Total MAGI income is equal to IRS adjusted gross income
- Interest income
- Title 2 Social Security income/Tier 1 Railroad Retirement income
- Foreign income (Section 911 IRC)
- Educational benefits exempt from income
- American Indian/Alaskan Native exempt income
- One-time lump sums not received in the month of application
- Income of tax dependents or children age 19 or younger that does not meet tax filing threshold requirements
Minus allowable IRS deductions
Minus 5% FPL income disregard
Note: Recipients of Parent/Caretakers Medical (N01) do not receive the 5% FPL income disregard unless they are receiving Medicare.
Note: The Washington Healthplanfinder web portal is programmed to only ask for countable income sources.
Individuals have the option to report their income that is most representative of their current circumstances.
Example 1: A fisherman works seasonally during the summer months and his family lives off of the rest of his income during the rest of the year. In his case, it is in his best interest to average his income over the course of the year to determine his eligibility.
Example 2: An individual was and lost her job. She is now receiving unemployment compensation and actively looking for work. Because her income has changed and she cannot anticipate her future earnings, it is in her best interest to report her current unemployment benefits.
Example 3: An individual receives infrequent disbursements from an IRA as his sole source of income. Because this income is received infrequently but will continue, it is in his best interest to average this income over a period of time or take a yearly average.
Non-countable income is income that is not taxable under the Internal Revenue Code and non-countable for MAGI-based eligibility.
Educational benefits are not countable when they are used for educational expenses and not for living expenses.
Work study can be taxable income, but it is not countable if it is used for educational expenses.
Taxable per capita distributions, such as per capita from tribal gaming is countable MAGI income.
For more information, see the Tribal Income Desk Aid.
Income of a tax dependent or child age 18 or younger is only countable for the assistance unit if it meets or exceeds the tax filing threshold, regardless of their intent to file taxes.
Social Security income of a tax dependent or child age 18 or younger is never countable as the tax filing threshold is never reachable when determining their eligibility.
Individuals are self-employed who are in business for themselves. Countable self-employment income is gross income minus any allowable Internal Revenue Service business expenses. Types of businesses can include sole proprietorships, rentals, farming, partnerships, and corporations.
Most self-employed individuals can verify their income with their tax return unless they don’t file one or their most recent tax return is not a good reflection of their current income. These individuals can provide profit and loss for their business for the past three months.
Individuals who are shareholders in an S-corporation must provide proof of the wages the corporation pays them plus any ordinary business income received from the corporation.
To be considered a lump sum, it has to be:
- Anticipated to be received one-time; and
- A countable source of income
Example 1: Betty receives an inheritance from her mother who passed away during the month she applied for Washington Apple Health. She does not report this income because it is not a countable source of income.
Example 2: Johnny receives a distribution from stocks he holds in investments during the month of application. He reports this income, but this is not a lump sum because it is not received one time. This is anticipated to be ongoing income. Johnny averages this income over a period of time.
Example 3: Jesse wins the lottery and receives a lump sum during his certification period. He reports this change, however, because the lump sum was not received during the month of application, it is not countable income. Only the interest income from the lottery winnings is countable income.