Asset
For all cash, medical, and SNAP programs, the Making Work Pay Credit is exempt as an asset for two months following the month of receipt. The Making Work Pay Credit is only available for the 2009 and 2010 tax years.
The credit is received either by a reduction in the wage earner's federal withholding tax, or is paid with the wage earners 2009 and 2010 tax refunds if the withholding tax was not changed.
Exempt any portion of the tax refund identified as the Making Work Pay Credit for the month of receipt and the following two months. If the assets are above the asset limit and the person says some of the money was from the Making Work Pay Credit:
- Determine if the person is within $400 for a single filer or $800 for a joint filer of the program's asset limit, and
- Verify that the income tax refund was received within the last 3 calendar months.
If the person meets both steps, exempt $400 for a single taxpayer and $800 for a joint filer through the second month following receipt of the tax refund. If the person reports that the Making Work Pays Credit is a lessor amount, exempt the actual amount. After the three month exemption, count the credit as an available asset.
Income
For all cash and medical programs, the Making Work Pay Credit, authorized by the American Recovery and Reinvestment Act of 2009, is exempt as income. The credit is only available for the 2009 and 2010 tax years.
The credit is received either by a reduction in the wage earner's federal withholding tax, or when they file their 2009 and 2010 income taxes if the withholding tax was not changed. Employers reduced the federal tax withholding from employees' paychecks beginning in March 2009.
When the credit is received by a reduction in the wage earner's federal withholding tax, there is no change in the amount of income to count from an individual's paystub for TANF and GA. For AABD, deduct the Work Pay Credit as an employment expense.
