Medicaid: What Do I Count as "Income"?

Marketplaces, Medicaid, and CHIP all use MAGI to decide a household's income for eligibility. MAGI stands for Modified Adjusted Gross Income. The best manner to figure it out is to work through the numbers backward.

Start with your gross income, which is your full taxable income. If y'all have multiple income streams, you add them all together to get your total income. Taxable income may include wages, salaries, bonuses, alimony, self-employment income, pensions, castigating amercement, IRA distributions, jury duty fees, unemployment compensation, rents, royalties, severance pay, gambling winnings, interest, tips, and manor or trust income.

You may besides be receiving income that is not considered taxable. You practice not accept to include this income when applying for Medicaid. Types of not-taxable include may include child support, gifts, veterans' benefits, insurance proceeds, casher payments, AFDC payments, injury payments, relocation pay, TANF payments, workers' compensation, federal income revenue enhancement refunds, and SSI payments.

Once you know your gross income, you can subtract IRS-approved deductions to get your adjusted gross income (AGI). For those that are self-employed, these deductions include whatsoever business organization related expenses. They also include alimony payments, IRA contributions, tuition and fees, pupil loan interest, and piece of work-related moving expenses.

Finally, once you accept your AGI, you tin can effigy out your MAGI. For near people, your AGI and your MAGI volition really be the same amount. At that place are very specific items that are modified to create your MAGI, but they simply don't apply to all people.

The first item is foreign earned income. If you earn money working overseas, it can often be excluded from your gross income when filing your income taxes. Foreign earned income needs to be added back into your gross income to summate your MAGI.

The second factor is exempt interest. When y'all are filing your income taxes, some interest y'all may receive throughout the year is exempt from you having to pay taxes on it equally part of your income. Nonetheless, when determining your MAGI, that interest does count towards your gross income, so it needs to be added back in.

Finally, the third gene is whatever corporeality of money that is equal to the portion of your social security benefits that was not counted towards your gross income under Section 86 of your income taxes. Once again, this amount will need to exist added to your gross income in order to calculate your MAGI.

Mostly speaking, the college your income, the less premium tax credits you receive. Your MAGI provides a truer look at how much money you actually bring in then that determining your eligibility for premium tax credits is off-white and equitable.

Eligibility Team

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