PM 07-03-07
Federal Tax Refunds
If assets cause ineligibility, ask the unit if they received a Federal tax refund in the last 12 months and what amount they received. There is no need to verify the federal refund. If they did receive a Federal tax refund, subtract the Federal income tax refund from the total amount of assets. If the difference between the resources and the amount of the Federal tax refund is less than the resource limit, the unit remains eligible.
Example 1: On February 21, Ms. A applies for Chicago GA for herself and her child. On the application Ms. A reports a savings account with $3400. At the interview, the worker asks Ms. A if she received a Federal tax refund in the last 12 months and she reports that she received a $1510 refund.
The worker subtracts the $1510 from the total assets of $3400 and is left with a balance of $1890. $1890 is below the GA asset limit of $3000 for two people so Ms. A is eligible for GA.
State Tax Refunds
When a client reports receipt of a State tax refund:
- Verify the refund amount by viewing the tax refund check or the client's State Tax Return.
- Determine what portion of the check is tax refund, and if any, an Earned Income Credit (EIC) payment.
- Add the tax refund portion to other nonexempt assets, and compare the total to the asset limit.
The amount received as an EIC payment is exempt as both an asset and as income.
For joint income tax refunds, when the client claims that less than half of the joint income tax refund was received, the amount claimed is an asset. Accept the client's statement as to the amount received.
