63-609 Claims and Adjustments (Q&A)

Table of Contents

Subject	Question/Answer
CalWORKs Grant	CalWORKs Grant Recalculation to Determine an Overissuance or Underissuance
Collection of Overissuances	· Collection of Overissuances from Adult Household Members · Collecting a Claim from Two Separate Households · Collection of Overissuances from Excluded Household Members Including SSI/SSP Recipients
Determination of Overissuance	Calculating Overissuance of Household with Self-Employment and Regular Earnings

CalWORKs Grant Recalculation to Determine an Overissuance or Underissuance

QUESTION To determine an overissuance, do we count the CalWORKs grant that was actually issued, or do we recalculate the CalWORKs grant? ANSWER When computing an overissuance or underissuance, the worker will use the actual CalWORKs grant amount that was anticipated with reasonable certainty or that was reasonably anticipated. QR regulations support using the amount of the grant that was reasonably anticipated with no look-back for recalculation of the CalWORKs grant. An overissuance or underissuance will not be assessed when actual income received during the quarter differs from the amount of income reasonably anticipated, as long as the recipient met his or her mandatory reporting obligations. Since CalWORKs grants are known-to-county information and not subject to recipient reporting, a recalculated grant is not required. ACIN I-16-05

Collection of Overissuances from Adult Household Members

QUESTION Can the county collect from any adult member present in the household at the time of an overissuance, including adult children, but not collect from children who leave the case and establish their own household? ANSWER Yes. All adult household members, including children who are adults in the household, are liable for any overissuances that occurred while they were in the household. Per Section 63-451.1, a claim shall be established against any household that has received more CalFresh benefits than it is entitled to receive or to any household which contains an adult member who was an adult member of another household that received more CalFresh benefits than it was entitled to receive. While minor children are not liable for overissuances, if the household consists of all minors, a collection action can be initiated against a household whose only eligible members are minors. However, if a minor leaves an “all minor” household, that minor is not liable for the overissuance. ACIN I-16-05

Collecting a Claim from Two Separate Households

CASE SCENARIO: A household consists of three adult sisters and five children all receiving CalFresh. An overissuance occurs and collection activity begins. Two of the adult sisters and their children move out of the home leaving only one sister and two children active (Case A). One sister moves in with her boyfriend who is receiving CalFresh with his mother and brother (Case B). Collecting activity now begins in Case B as the sister that was active in Case A is now active in Case B. QUESTION: Can we collect from both cases at the same time for one claim? Per Section 63-451.2, we can collect from all adults who were in the household when the overissuance occurred, and at the same time for the same claim? According to this section, claim collection will be from all adults who were in the household when the overissuance occurred. ANSWER: Yes. The worker can collect from two separate cases at the same time for the same claim as long as each case consists of an adult member who was an adult member of another household that received more CalFresh benefits than it was entitled to receive. A collection can be initiated in a new CalFresh household (Case B) if the “liable” member moves to a new household. The worker shall establish a claim against any household that has received more CalFresh benefits than it is entitled to receive or any household which contains an adult member who was an adult member of another household that received more CalFresh benefits than it was entitled to receive. ACIN I-58-08

Collection of Overissuances from Excluded Household Members Including SSI/SSP Recipients

QUESTION Can the county demand repayment from an excluded household member such as an SSI/SSP recipient or an undocumented person? ANSWER Yes, but for excluded household members other than SSI/SSP members. Federal regulations state adult members of the household are responsible for overissuances. Excluded household members, are part of the household, but not currently receiving benefits due to ineligibility status, such as being sanctioned, having SSI status or having drug/fleeing felon status (please refer to Section 63-101.6). Given the fact that they are adults and considered part of the household and could have caused the overissuance, excluded household members not currently in a status to be receiving benefits, are responsible for repayment of a claim. Although SSI/SSP recipients may be responsible for the overissuance, repayment cannot be demanded from the SSI/SSP benefit. Repayment can be demanded from the other excluded adult household members.

Calculating Overissuance of Household with Self-Employment and Regular Earnings

A CalFresh household member receiving benefits since 2002 has been reporting earned income from her full-time job. Three years later an Income Eligibility Verification System (IEVS) report showed the household member has also been working as self-employed, paid in cash. The worker received a copy of the household member’s tax forms from IRS showing the annual income the household did not report to the county.

QUESTION

Since this household member has two different incomes, what is the correct methodology to determine the overissuance?

ANSWER

Based on Section 63-241.5, which states “Self-employment must be averaged over the period of time the income is intended to cover....,” it is appropriate to average self-employment income over the year it was received. That monthly figure is considered gross self-employment income.

The self-employed income needs to be computed separately from income earned on the job to arrive at a “net gross” self-employment income amount.

The preferred methodology to determine the overissuance in this case is as follows:

Step	Action
1	Verify and average the gross self-employment income as explained in Sections 63-241.5, 63-241.6 and 63-241.9.
2	Subtract 40 percent for self-employment expenses from the gross income in Step 1, or deduct the actual costs of doing business to arrive at the “net gross” self-employment income amount (Section 63-241.7).
3	Compute all earned income: Add the gross earned income from the job, and the “net gross” from self-employment to obtain the total gross earned income.
4	Allow all applicable deductions. When determining the amount of benefits the household should have received, the worker will not apply the 20 percent earned income deduction to the portion of earned income the household failed to report.
5	Deduct what should have been received from what the client actually received to determine the amount of the overissuance.

ACIN I-96-06