Applicant Gross Income Test

[W&I Code 11267 and 11450.12]

At the time of application, an AU is not eligible for the current or future month if the total reported or anticipated gross income for that month exceeds MBSAC plus special needs. Gross income includes:

  • Total gross earnings from employment - less $450 for each employed person.
  • Disability Based Income.
  • Net earnings from self-employment income - Allow the actual business deductions or the 40% disregard. Refer to Self-Employment.
  • Child Support whether received directly by the client or collected by the county (less the $100 or $200 disregard).
  • Unearned Income.
  • Any other nonexempt income of persons in the "family" whose income must be counted towards the AU.

Exception to Applicant Gross Income Test

Former recipients whose cash aid was discontinued due to TSE earnings, shall now be considered recipients when reapplying for benefits within three calendar months of the TSE ending. However, if an individual applies for CalWORKs after this three-month period has passed, he or she shall be considered an applicant for the purpose of CalWORKs eligibility.

Example Example Client was discontinued earlier in the year due to increased earnings received from their TSE. Client’s TSE ended on April 18 and he or she re-applies for CalWORKs on June 8. The three month period for the client to reapply and be treated as a recipient is from April 18 (last date of employment) to July 18. Because June 8, is within the three month time period, the client must be treated as a recipient and allowed the current Income Disregard and 50% deduction. Because they are considered a recipient, the 100-hour work rule does not apply.

Income Tests

The Applicant Gross Income Test and the 100 Hour Work Rule shall not be applied to the former TSE client who was discontinued due to income and is applying within three months of their TSE termination. The Recipient Net Income Test must be used for these clients.

Financial Ineligibility in Month of Application

When the AU is determined financially ineligible for the month of application, but the EW determines the AU will become financially eligible within 60 days of the application date, the EW MUST enter the reasonably anticipated income for the payment period in CalSAWS. If the AU is financially eligible for the second month, CalSAWS will approve aid for the AU on the 1st day of the second month. The grant amount will be based on the reasonably anticipated income for the next six months (including the month of approval).

If Financially Eligible in the 2nd Month, AND. . .

Then the CalSAWS. . .

CalFresh are approved in the month of application (1st month),
  • Will approve CalWORKs effective the 1st day of the second month.

  • Calculates the grant amount based on the reasonably anticipated income.

  • Will use the report cycle established by the Food Stamp approval.

CalFresh are NOT approved in the month of application (1st month),
  • Will approve CalWORKs effective the 1st day of the second month.

  • Calculates the CW grant amount based on the reasonably anticipated income for the months following the original application date.

  • Establish the report cycle based on the date of the CalWORKs approval (1st day of the month following the month of application).

Computation of Applicant Gross Income Test

To determine if the family passes the Applicant Gross Income test, the EW must follow these steps:

  1. Determine the applicant family (AU and Non-AU members) gross income, including earned, unearned, disability based and self-employment income.
  2. Disregard up to $450 of earned income for each employed family member. The remainder equals the net non-exempt income.
  3. Determine MBSAC plus Special Needs for family (AU and Non-AU members).
  4. Compare the figure obtained in Step 2 with Step 3.
    1. If the net nonexempt income (Step 2) exceeds the MBSAC plus Special Needs (Step 3) then the AU is ineligible.
    2. If the net nonexempt income (Step 2) is less than the MBSAC plus Special Needs (Step 3) then the AU has passed the Applicant Gross Income Test.

Examples of Applicant Gross Income Test

Example 1Example 1

A family of four applies for CalWORKs in January. The mother is pregnant. The family has no income. The Applicant Gross Income Test is determined as follows:

If this AU has net nonexempt income (or is expected to receive income) in an amount in excess of $1788, the AU is not eligible.

Example 2Example 2

A family of five applies for CalWORKs. Mom is employed and earns $2200 a month. The Applicant Gross Income Test is determined as follows:

The Net non-exempt income is in excess of the total need for an AU of 5. They fail the Applicant Gross Income Test and the AU is ineligible.

Related Topics

Financial Eligibility Determination

Recipient Net Income Test

Income Reporting Threshold (IRT)

MAP Levels

Examples of MAP Status

Federal Financial Participation

State-Only Payments