Lump Sum Income

Lump sum income is defined as any payment received that is nonrecurring in regard to the amount or the source. Any nonrecurring lump sum is to be considered as income in the month it is received.

Treatment

CalWORKs or SSI Ineligibility

An applicant/recipient who is ineligible for a federal or state cash program (such as CalWORKs or SSI), due to the receipt of lump sum income, will also be ineligible for GA for the duration of the period of ineligibility (POI).

Prior Month's Receipt APPLICANT'S Only

Lump sum income received prior to the month of application will not be counted as income. Amounts of the lump sum income that is remaining, on the first of the month following the month of receipt, will be counted as property.

Prior Month's Receipt RECIPIENT'S Only

Recipients who report timely, (within ten (10) days of the occurrence); a lump sum received in the prior month, will have the lump sum counted in the current month. This information must also be reported via the “Semi-Annual Eligibility/Status Report (SAR 7).

An overpayment must be calculated for GA benefits received in the current month if the amount of the lump sum received in the prior month and the GA payment received in the current month, totals more than the recipient's need standard for the current month.

Any GA payments anticipated to be received in the current month must also be included in the overpayment calculation, if proper notice cannot be given to discontinue the case prior to the end of the month.

Note: Overpayment calculations are shown in Payment chapter.

Anticipated Lump Sum Income

Anticipated lump sum income is treated as if, it will be received in the future month, rather than the current month.

The EW MUST enter all information appropriately into CalSAWS and generate a timely discontinuance NOA that must be sent regarding the anticipated excess income.

However, if the anticipated income is not received by the end of the month in which it was anticipated, the discontinuance must be rescinded, and the correct grant will be retroactive.

Shortening the Period of Ineligibility (POI)

The POI that results from the client’s receipt of a lump sum may be shortened only by a verified life threatening situation such as, but not limited to, fire, flood, etc.

Computations for shortening the client’s POI, due to a life threatening situation, is determined as follows:

EW will manually add the lump sum income, and any other, net nonexempt income that was used to compute the period of ineligibility, and
Subtract the amount expended on the life threatening situation, (verification/receipts required), and enter information into CalSAWS to calculate the new POI and send the appropriate NOA.

ExamplesExamples

(1) The April SAR 7 from client that was received in May reported income tax refunds of $700 that was received in April. No other income, and no other lump sum is anticipated. The need standard is $337.

$700 divided by $337 = 2+ months of ineligibility

Determine period of ineligibility.

Discontinue case effective 5/31. Recipient is ineligible for May and June.

2 months multiplied by $337 = $674

Multiply period of ineligibility by the need standard.

$700 minus $674 = $26 to be applied to July

If the recipient reapplies in July, $26 will be counted as income in addition to any other net non-exempt income in July.

Reminder: An overpayment must be calculated for the amount of GA benefits that client received in May.

(2) A recipient calls on December 15th, to report their UIB appeal has been granted and that they expect to receive a payment of $900 in back UIB in the next month (January). There is no other income at this time; however, anticipated UIB for the future month is $200. The need standard is $337. Total income for January is $900 + $200 = $1100.

$1,100 divided by $337 = 3+ months of ineligibility

Determine the period of ineligibility.

Discontinue case effective December 31. Recipient is ineligible for January, February, and March.

3 months multiplied by $337 = $1,011

Multiply the period of ineligibility by the need standard.

$1,100 minus $1,011 = $89 to be applied to April

If the recipient reapplies in April, $89 will be counted as income in addition to any other net non-exempt income received in April.