ModifiedConnecticut Department of Social ServicesPolicy N/A

Treatment of Reductions in Income due to Recovery of Overpayments

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This policy governs how Connecticut Department of Social Services programs count income reduced because an overpayment is being recovered, primarily for SNAP, TFA, AABD, MAABD, and FMA eligibility and benefit determinations.

Policy Summary

PayerConnecticut Department of Social Services

PolicyTreatment of Reductions in Income due to Recovery of Overpayments

Policy CodePolicy N/A

Change TypeClarification

Effective DateJuly 1, 2011

Next Review DateN/A

Key ActionFor FMA, count income from which a same-source erroneous overpayment recovery was withheld at the amount received after the recovery is deducted.

SourceLink

POLICY UPDATE CHANGES

The policy clarifies how income withheld to recover an overpayment from the same income source is treated for TFA and FMA.

5 programsPrograms addressed

$50/monthTFA current child support disregard

$200/quarterTFA irregular gift exclusion

Post-recovery amount

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ModifiedConnecticut Department of Social ServicesPolicy N/A

Treatment of Reductions in Income due to Recovery of Overpayments

Customize your policy alerts

Sign up for all Connecticut Department of Social Services policy alerts

Know when Connecticut Department of Social Services releases new policies or updates existing guidance.

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Policy Summary

PayerConnecticut Department of Social Services

PolicyTreatment of Reductions in Income due to Recovery of Overpayments

Policy CodePolicy N/A

Change TypeClarification

Effective DateJuly 1, 2011

Next Review DateN/A

Key ActionFor FMA, count income from which a same-source erroneous overpayment recovery was withheld at the amount received after the recovery is deducted.

SourceLink

POLICY UPDATE CHANGES

The policy clarifies how income withheld to recover an overpayment from the same income source is treated for TFA and FMA.

5 programsPrograms addressed

$50/monthTFA current child support disregard

$200/quarterTFA irregular gift exclusion

Post-recovery amount

Same-source FMA recovery rule

8%Government rental subsidy attribution

Income Counting and Exclusion Rules

SNAP Recoupment Withholdings

For SNAP, treatment of money withheld from TFA, AABD, General Assistance, SSI, or SSA payments depends on the type and status of the overpayment.

Apply the applicable overpayment category

IPV overpayment
- Money withheld to recoup an overpayment resulting from an Intentional Program Violation (IPV) is counted as income as though it had not been withheld.
Non-IPV or administrative overpayment
- Money withheld to recoup an overpayment resulting from a non-Intentional Program Violation situation or administrative error is excluded when calculating SNAP eligibility and benefits.
Overpayment type undetermined
- The withheld amount is excluded when the type of overpayment is unclear.
- The withheld amount is excluded when an alleged IPV has not been adjudicated.

Benefit Reductions and Program-Specific Recovery Rules

Benefit reductions and income reductions are treated according to the program and the circumstances that caused the reduction.

SNAP benefit reductions imposed by another means-tested assistance program

The reduced, suspended, or terminated benefit is from a means-tested federal, state, or local welfare or public assistance program.
The reduction is imposed because of fraud under that means-tested federal, state, or local welfare or public assistance program.
Count the amount of income the household would receive if no decrease in benefits due to fraud had occurred.

AABD or MAABD recovery withholding

Count the amount of income the household would receive if no withholding had occurred.

TFA Income Treatment

Except where this chapter provides special treatment, gross income received by each assistance unit member, or by another person on the member’s behalf, is aggregated and counted for TFA eligibility and benefit calculations.

General TFA income treatment

Count the gross amount of all income received by each assistance unit member or by someone else on behalf of an assistance unit member, unless a stated exception applies.
Apply the chapter’s specified exclusions, disregards, and deductions before determining applied income.
Deem to the assistance unit the applicable portion of income received by certain people outside the assistance unit who are financially responsible for assistance unit members.
Use remaining applied income to determine income eligibility and calculate the assistance unit’s benefits.

Income not specially treated

Income Exclusions for Specified Payments

The following payments are excluded from income when determining TFA eligibility and calculating TFA benefits, subject to the conditions stated.

Payments made to children or on their behalf

Exclude federal, state, and local adoption assistance payments when the child for whom the payment is made is not a member of the assistance unit.
Exclude the portion of an adoption assistance payment that does not duplicate the standard of need or that supplements TFA benefits insufficient to meet the child’s special needs.
Exclude federal, state, or local payments received for the care of foster children placed with the assistance unit.
Exclude supplemental food assistance received under the Child Nutrition Act of 1966, as amended, and special food service programs for children under the National School Lunch program, Public Law 92-433 and Public Law 93-150, as amended.

Special Income Attribution and Counting Rules

Certain income is attributed or counted under special rules rather than ordinary income treatment.

Government rental subsidies

Attribute income to an assistance unit residing in government-subsidized housing.
Government-subsidized housing includes federal Section 8, Connecticut’s Rental Assistance Program (RAP), the Transitional Rental Assistance Program, and federal Low-Income Public Housing.
Amount attributed
- For an assistance unit subject to the time limit, attribute eight percent of the appropriate payment standard.
- For an assistance unit exempt from the time limit, attribute eight percent of the appropriate standard of need.

Interest income

Miscellaneous Payment Exclusions

The following miscellaneous payments and amounts are excluded from TFA income.

General miscellaneous and support-related exclusions

Exclude cash contributions from agencies and organizations for goods and services not considered by the Department in setting its standard of need under section 8562.15.
Exclude irregular or unpredictable gifts, up to $200 per calendar quarter.
Exclude the value of goods and services provided in kind, except as otherwise specified for payments made directly to others on behalf of an assistance unit and payments by General Assistance or SAGA.
Exclude payments made to members of the nationwide class of present and former tenants covered by the Underwood v. Harris settlement.
Exclude rent paid directly to a landlord on behalf of recipients.

Specified Income Limits and Amounts

TFA Current Child Support Disregard

Disregard amountThe first $50 per month of current child support income is disregarded.

Payment sourceThe disregard applies whether child support is paid through the Department or directly by the absent parent.

ProgramThe rule applies to current child support received by the Temporary Family Assistance assistance unit.

TFA Irregular or Unpredictable Gift Exclusion

Exclusion limitIrregular or unpredictable gifts are excluded when they are not more than $200 per calendar quarter.

Payment patternThe exclusion applies to gifts received on an irregular or unpredictable basis.

Operational Handling of Overpayment Recovery

Billing Rule

Classify Overpayment Recoupment

Before determining whether a recoupment withholding is countable or excluded for SNAP, classify the overpayment and confirm whether an alleged Intentional Program Violation (IPV) has been adjudicated.

IPV overpayment: Count the amount withheld as though it had not been withheld.
Non-IPV or administrative overpayment: Exclude the amount withheld when calculating SNAP eligibility and benefits.
Type unclear: Exclude the withheld amount as income.
Alleged IPV not adjudicated: Exclude the withheld amount until the IPV has been adjudicated.

Billing Rule

Apply the Same-Source Recovery Rule

For FMA, when income is withheld to recover an erroneous overpayment from that same income source, count the income after the recovery is taken.

Key Income and Overpayment Terms

IPV Overpayment

DefinitionAn IPV overpayment is an overpayment caused by an intentional program violation.

SNAP treatmentMoney withheld to recoup an IPV overpayment is counted as income as though it were not withheld.

Affected paymentsThe rule covers money withheld from TFA, AABD, General Assistance, SSI, or SSA payments for SNAP purposes.

Non-IPV or Administrative Overpayment

DefinitionA non-IPV or administrative overpayment results from a non-intentional program violation situation or an administrative error.

SNAP treatmentMoney withheld to recoup the overpayment is excluded when calculating SNAP eligibility and benefits.

Policy Summary

PayerConnecticut Department of Social Services

PolicyTreatment of Reductions in Income due to Recovery of Overpayments

Policy CodePolicy N/A

Change TypeClarification

Effective DateJuly 1, 2011

Next Review DateN/A

Key ActionFor FMA, count income from which a same-source erroneous overpayment recovery was withheld at the amount received after the recovery is deducted.

SourceLink

On This Page

Exception: apply the special rule when the income was received concurrently with AABD or MAABD assistance at the time the overpayment occurred and the overpaid amount was included in determining AABD or MAABD eligibility.

FMA recovery withholding

When money is withheld from an earned or unearned income source to recover an erroneous overpayment from the same source, count the amount of income remaining after the recovery is taken.

Income received directly or indirectly by assistance unit members that is not specifically described as qualifying for special treatment is counted in its entirety for eligibility and benefit calculations.

Same-source overpayment recovery

When money is withheld from an earned or unearned income source to recover an erroneous overpayment from that same source, count the amount of income received after the recovery is taken.

Exclude benefits paid under Public Law 104-204 to children of Vietnam veterans born with spina bifida.

Payments to Indian Tribe members

Exclude payments from Indian judgment funds, including interest, distributed to or held in trust for members of Indian tribes under Public Law 98-64.
Exclude receipts distributed to members of certain Indian tribes under section 5 of Public Law 94-114, effective October 17, 1975.

Payments to volunteers

Exclude supportive-service payments and reimbursement of out-of-pocket expenses paid to individual volunteers serving as foster grandparents, senior health aides, or senior companions, and to persons serving in SCORE, ACE, and other programs under Titles II and III, section 418 of Public Law 93-113.
Exclude payments made to volunteers under Title I, VISTA Volunteers, section 404(g) of Public Law 93-113, unless the Director of ACTION determines that the payment equals or exceeds the applicable federal or state minimum wage.

Payments to students

Exclude payments to students of any age that reward educational success.
Exclude earned and unearned income paid to a dependent child under the Job Training Partnership Act of 1982 (JTPA).
Exclude grants, loans, and work-study earnings paid to any undergraduate student for educational purposes by a federal, state, or private source.
Exclude payments to students enrolled in post-secondary educational institutions under the Service Learning Program (University Year for Action), authorized under Title I of the Domestic Volunteer Service Act of 1973.

Count interest income paid as part of a periodic payment or other cash withdrawal from an IRA, Keogh, 401(k) plan, pension, or annuity.

Do not count other interest earned on an asset as income.

Unavailable income

Do not count income considered unavailable to the assistance unit.
Treat income as available when it is actually available or when the individual has the legal right, authority, or power to make it available for general or medical support.
Applicants and recipients must pursue potentially available income to the Department’s satisfaction.
Failure to cooperate in obtaining potentially available income makes the entire assistance unit ineligible.

Recovery of overpayments

When money is withheld from an earned or unearned income source to recover an erroneous overpayment from the same source, count the amount remaining after the recovery is taken.

Exclude money received on behalf of and used for the care and support of a person who is not an assistance unit member and is not a mandatory member who has been disqualified or is ineligible.

Exclude Department payments for day care and essential services unless the assistance unit member is the provider.

Exclude payments made under the Title IV-D Support Program as rebates from support collected under the Deficit Reduction Act of 1984.

Exclude Department payments made to assist individuals pursuing employment.

Relocation, housing, and disaster exclusions

Exclude payments received under Title II of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970.
Exclude disaster assistance under the Disaster Relief Act of 1974, including the Individual Assistance program, comparable disaster assistance from states, local governments, and private organizations, and interest earned on those funds.
Exclude security deposits paid by the Department and security deposits returned by a landlord to the assistance unit.
Exclude energy and utility subsidies.
Exclude rent money returned to an assistance unit by a court.
Exclude reimbursements for moving and relocation expenses under section 47-88d of the Connecticut General Statutes for households that do not purchase a dwelling converted to a condominium.
Exclude payments under the Connecticut Uniform Relocation Assistance Act.
Exclude relocation adjustment payments under section 114 of the Federal Housing Act of 1949.

Statutory and settlement payment exclusions

Exclude the portion of military pay withheld to fund the G.I. Bill under Public Laws 94-502 and 99-576.
Exclude payments made under section 10405 of Public Law 101-239.
Exclude Japanese Restitution payments and payments to residents of the Aleut and Pribilof Islands under Public Law 100-383.
Exclude Radiation Exposure Compensation payments under section 6(h)(2) of Public Law 101-426, effective October 15, 1990.
Exclude up to $2,000 in total cash payments per individual per year under section 15 of the Alaska Native Claims Settlement Act, Public Law 100-241.
Exclude payments to victims of Nazi persecution under Public Law 103-286.

ProgramThis is an income exclusion used in determining Temporary Family Assistance eligibility and benefits.

Irregular or Unpredictable Gifts

Maximum excluded amount$200 per calendar quarter.

Eligible paymentsThe limit applies to gifts received on an irregular or unpredictable basis.

TreatmentGifts within the limit are excluded from income.

Alaska Native Claims Settlement Act Payments

Annual exclusion limitUp to $2,000 in total cash payments per year per individual.

Payment sourceThe exclusion applies to payments made pursuant to section 15 of the Alaska Native Claims Settlement Act, Public Law 100-241.

TreatmentCash payments within the stated limit are excluded from income.

Government Rental Subsidy Income Attribution

Time-limit assistance unitsAttribute income equal to 8% of the appropriate payment standard.

Time-limit-exempt assistance unitsAttribute income equal to 8% of the appropriate standard of need.

RuleThe Department attributes income to assistance units residing in government-subsidized housing.

This same-source rule applies to both earned and unearned income.
Count the post-recovery amount when determining eligibility.

Affected paymentsThe rule covers money withheld from TFA, AABD, General Assistance, SSI, or SSA payments for SNAP purposes.

Undetermined Overpayment

DefinitionAn overpayment is undetermined when its type is unclear.

Unadjudicated IPVThe rule also applies when an alleged IPV has not been adjudicated.

SNAP treatmentThe withheld amount is excluded as SNAP income.

Applied Income

General ruleThe gross amount of all income received by each assistance unit member, or by someone else on the member’s behalf, is aggregated and counted.

AdjustmentsIncome is counted after applicable exclusions, disregards, and deductions are made.

Use of applied incomeThe remaining applied income determines income eligibility and the amount of benefits.

Other Special Treatments

DefinitionOther special treatments apply to income that is neither disregarded nor excluded but is treated differently from other income.

ExamplesSpecial rules address government rental subsidies, interest income, unavailable income, and income reduced by same-source overpayment recovery.

Same-source recoveryWhen an erroneous overpayment is recovered from the same earned or unearned income source, count the amount remaining after the recovery is taken.

Government-Subsidized Housing

Included programsFederal Section 8 Housing, Connecticut’s Rental Assistance Program (RAP), the Transitional Rental Assistance Program, and federal Low-Income Public Housing.

DefinitionGovernment-subsidized housing is housing covered by one of these listed programs.

Income ruleThe Department attributes income to assistance units residing in government-subsidized housing.

Unavailable Income

Unavailable incomeIncome considered by the Department to be unavailable to the assistance unit is not counted.

When income is availableIncome is available when it is actually available or when the individual has the legal right, authority, or power to make it available for general or medical support.

Required actionApplicants and recipients must pursue potentially available income to the Department’s satisfaction.

Failure to cooperateFailure to cooperate in obtaining potentially available income results in ineligibility of the entire assistance unit.