PM 23-05-01-b: Figuring the Monthly Recoupment Amount

WAG 23-05-01-b

Figure the monthly recoupment amount prospectively, using the case's income and facts for the payment month. Use the income of all persons in the cash case to figure out the recoupment. The monthly recoupment amount cannot reduce the family's total income, including the cash benefit, to less than 90% of the correct monthly Payment Level or AABD standard for the case size. For TANF cases, the monthly recoupment amount is limited to a maximum of $75 per month.

For TANF, the system centrally allows the following items when figuring the monthly recoupment:

  • business expenses for self-employed persons; and
  • child care disregard up to the maximum (if allowed); and
  • diverted income used to meet the needs of an ineligible family member. See PM 10-04-02 to figure diverted income.

The system also allows an initial income deduction for employment expenses for cases with earned income. For TANF, the earned income exemption ($3 for $4) is included in the total income used for recoupment.

Always drop cents when figuring the recoupment amount.

When a job ends, central recoupment stops using the earned income prospectively because there is none to use for the payment month.

For AABD, if total income without the DHS monthly cash benefit amount equals or exceeds 90% of the AABD standard, the entire cash benefit is recouped.

For TANF, if total income without the DHS monthly cash benefit amount equals or exceeds 90% of the Payment Level, the cash benefit is recouped up to the monthly maximum recoupment amount of $75 per month or the entire cash benefit, whichever is less. For TANF, if the calculated monthly recoupment reduces the cash benefit amount to between 1¢ and 99¢, the recoupment is centrally reduced to give the $1 minimum cash benefit. When the entire cash benefit is recouped, the case is put in zero grant status and the family continues to get SNAP and medical.

For TANF, central recoupment continues until all recoupable claims are collected. When the overpayment is totally recouped, ARS automatically stops monthly recoupment. If there is a non-recoupable balance remaining, the system starts recovery action. See PM 23-05-01-d for policy on the recovery of overpayments.

For AABD text deleted, recoupment stops automatically when the overpayment is totally paid back.