613 How to Calculate Income Eligibility for Freedom to Work (FTW)

Policy

The net income test is used to determine income eligibility under AHCCCS Freedom to Work (FTW). Only the customer’s earned income is used. Unearned income is not counted in the FTW calculation. Income is counted in the month it is received, even if earned in the previous month.

The customer’s counted earned income minus allowable deductions cannot be more than the income standard.

NOTE Only the customer’s income is counted. The income of a spouse or other family members is not counted for income eligibility.

1) The Income Standard

The income standard for AHCCCS FTW is 250% of the Federal Poverty Level (FPL).

2) Deductions from Net Income

The table below shows the allowable income deductions used in net income budgeting for AHCCCS FTW:

Allowable Deduction	Amount
General Income Deduction	$20.00
Student Earned Income Exclusion	Varies
Standard Work Expense Deduction	$65.00
Impairment Related Work Expense Deduction (IRWE)	Varies
One half of the Remainder of Earned Income	Varies
Blind Work Expenses	Varies

3) Calculation for AHCCCS FTW

The following steps are used to determine income eligibility for Freedom to Work:

Step	Action
1	For the income eligibility determination, disregard all unearned income received by the customer.
2	To calculate the net earned income: The counted earned income of the customer is totaled; and The following are subtracted in this order: Student Earned Income Exclusion (only if under age 22); The $20.00 general income deduction; The $65.00 work expense deduction; Impairment Related Work Expenses; ½ of subtotal of earned income; and Blind Work Expenses.
3	The result in Step 2 is compared to 250% of the FPL: The customer passes the income test if the net income is less than or equal to the income limit.

See Example: How to calculate FTW income Eligibility

Definitions

Term	Definition
Unearned income	Any income that is not received as the result of a job or self-employment.

Legal Authority

This requirement applies to the following programs:

Program	Legal Authorities
Freedom to Work (FTW)	AAC R9-22-1909