Treatment of Better for Families Tax Refund, and the Young Child and Foster Youth Tax Credits

The California Department of Social Services (CDSS) has issued guidance for various programs about the treatment of Better for Families Tax Refund, and the Young Child and Foster Youth Tax Credits.

AB 192 established the Better for Families Tax Refund program, called the middle-class tax refund. SB 201 expanded the definition of a qualified taxpayer to include taxpayers with no earned income and those in foster care between the ages of 18 and 25.

The CalWORKs program treats the Better for Families Tax Refund the same as the federal earned income tax credit. It does not count as income and does not count as a resource for 12 months.  Refunds from the Young Child and Adopted Youth Tax Credit are treated the same as federal earned income refunds and do not count as income, and do not count as a resource for 12 months.

CalFresh and the California Food Assistance Program do not count either the of Better for Families Tax Refund, or the Young Child and Foster Youth Credits as income. CalFresh and the California Food Assistance Program counts them as a resource beginning in the month received. However, most households are in California are not subject to a resource limit because they have either Categorical Eligibility or Modified Categorical Eligibility.

The Better for Families Tax Refund does not count as income for Medi-Cal Modified Adjusted Gross Income (MAGI) applicants or recipients. It will be considered property for non-MAGI Medi-Cal recipients.  Counties are reminded that the property limit for non-MAGI Medi-Cal is now $130,000 for one person and $65,000 for each additional person.

The Department of Health Services (DHCS) is seeking a federal waiver to exempt the Young Child and Foster Youth Tax Credit from being treated as income.

The CalWORKs program rules apply to RCA, ECA, and TCVAP programs, and they must follow the CalWORKs rule above both the Better for Families Tax Refund, and the Young Child and Foster Youth Tax Credits.

The Cash Assistance Program for Immigrants (CAPI) treats both the Better for Families Tax Refunds and the Young Child and Foster Youth Tax Credit in the same way as federal earned income refunds, and federal tax refunds are excluded from counting as income and from the resource limit.  (ACL 22-91, October 28, 2022.)

Reclassifying CalWORKs overpayments during COVID as IPVs

The California Department of Social Services (CDSS) has issued a clarification that CalWORKs overpayments established during COVID which were originally classified as administrative error must be reclassified as Intentional Program Violation (IPV) if the overpayments are later determined to be fraudulent.

CalWORKs overpayments established on or after August 1, 2021 for the period April, 2020 to or June 30, 2022, must initially be classified as administrative error. However, based on Welfare and Institutions Code section 11004.1, as amended by Senate Bill (SB) 187 (Chapter 50, Statutes of 2022), any of these claims can now be reclassified to IPV if they are later determined to be fraudulent.

Existing processes for issuing adequate and timely notice of action, referring cases to Special Investigations Unit (SIU), and IPV determination are unchanged.

This rule also applies to Refugee Cash Assistance (RCA), Entrant Cash Assistance (ECA), and Trafficking and Crime Victims Assistance Program (TCVAP) cash assistance programs.  (ACL 22-87, October 17, 2022.)

Cuban and Haitian Entrant eligibility for benefits programs

The California Department of Social Services has issued information regarding eligibility of Cuban/Haitian entrants for public benefits programs. 

Cuban/Haitian entrants may be eligible for Entrant Cash Assistance (ECA),. This refers to federally funded cash assistance available to those who do not meet the categorical requirements of other state/federal cash assistance programs. ECA follows the rules of the Refugee Resettlement Program. ECA applicants are not required to have a Social Security Number.

Cuban/Haitian entrants can be eligible for CalWORKs upon entry into the United States.  They must submit proof of applying for a Social Security Number within 30 days or have good cause for not applying for a Social Security Number.  Cuban/ Haitian Entrants who apply for or receive CalWORKs must be eligible for Homeless Assistance or the Housing Support Program (HSP). Cuban/Haitian Entrants can be eligible for Project Roomkey, the Bringing Families Home (BFH) program, the Housing and Disability Advocacy Program (HDAP), and/or the Home Safe program if they otherwise meet the eligibility requirements for each program.”

Cuban/Haitian entrants can be eligible for CalFresh immediately without a waiting period. Non-citizens who are eligible based on immigration status must meet all other requirements. These individuals are not eligible for the California Food Assistance Program while Entrant status is in effect because they are eligible for CalFresh.. 

Cuban/Haitian Entrants who are aged, blind, or disabled and meet income limits, may be eligible for SSI/SSP. Entrants are eligible for SSI for seven years. A Cuban/Haitian Entrant who is found ineligible for SSI because of their immigration status can be eligible for CAPI.

Cuban/Haitian Entrants who become eligible for ECA must meet work registration requirements.  Cuban/Haitian Entrants who do not have work authorization should be enrolled in services to help achieve self sufficiency.   (ACIN I-63-22, September 20, 2022.)

Extension of COVID-19 flexibilities for Refugee Cash Assistance

The California Department of Social Services (CDSS) has issued guidance implementing the extension of COVID-19 flexibilities for Refugee Cash Assistance (RCA), Entrant Cash Assistance (ECA), Refugee Support Services (RSS), Services to Older Refugees (SOR), and Trafficking and Crime Victims Assistance Program (TCVAP) Cash Assistance benefits through September 30, 2022.  These waivers include:

  • Allowing verbal attestation for eligibility determinations. This waiver continues flexibility regarding verification of immigration status. This flexibility also applies to arrivals from Afghanistan.
  • Excluding certain types of COVID-19 emergency assistance when determining eligibility and grant amounts. Such assistance is excluded as income, and excluded as an asset for 12 months.
  • Flexibility regarding participation in employment services. Under the waiver for employment services, counties are highly encouraged to continue to use remote case management and learning.
  • providing interim RCA payments for eligible applicants with pending CalWORKs applications who cannot complete application requirements because of COVID-19. When possible, counties must assess and grant good cause instead of interim RCA payments when Social Security Number applications and approvals are delayed because of COVID. However, when good cause is not possible, counties can issue interim RCA payments when CalWORKs approvals are delayed because of COVID.  These COVID-related delays can include inability to apply for or get a Social Security Number because of office closure.

TCVAP follows the same administrative rules as RCA and therefore these waivers also apply to TCVAP.  (ACWDL, March 3, 2022.)

Changes to CalWORKs eligibility for pregnant persons

Effective July 1, 2022, pregnant CalWORKs recipients with no other eligible children will get an increase on their monthly pregnancy special needs (PSN) payment from $47 to $100.

Previously, pregnant adults age 19 or over with no other eligible children were eligible for CalWORKs benefits beginning of their second trimester of pregnancy, six months before the expected birth date.  Effective July 1, 2022, pregnant persons will be eligible for CalWORKs as of the date of application. They will no longer need to wait until their second trimester to receive CalWORKs and are eligible in their first trimester of pregnancy. 

In addition, medical verification requirements will change to allow recipients to provide a sworn statement or verbal attestation of pregnancy. This sworn statement shall include the applicant’s name, date of application, and declaration of pregnancy. Medical verification of pregnancy must be given to the county within 30 days of sworn statement/verbal attestation. Aid will discontinue with failure to provide medical proof unless the recipient presents evidence of a good-faith effort to provide information to fulfill this requirement. 

Benefits provided to Pregnant teens under the age of 19 or without a high school diploma will remain the same.

If a pregnancy ends before the delivery date, the $100 monthly Pregnancy Special Needs payment will end the month following the date the recipient reports the end of their pregnancy.

Although CalWORKs rules apply to Refugee Cash Assistance (RCA), Entrant Cash Assistance (ECA), and Trafficking and Crime Victims Assistance Program (TCVAP), those programs are intended for families without children.  However, recipients of those benefits can apply for  CalWORKs anytime during their pregnancy.

To be eligible for CalWORKs Home Visiting Program (HVP), an individual must a) be a member of the CalWORKs assistance unit b) The individual is pregnant, or c) the individual is a parent/caretaker relative of a child less than 24 months of age at the time the individual enrolls in the program.  (ACL 21-140, November 18, 2021.)

Impact of end federal pandemic unemployment programs impact on CalWORKs and CalFresh

The California Department of Social Services (CDSS) has provided guidance regarding the end of the federal pandemic unemployment programs in CalWORKs and CalFresh.  The programs ending are Pandemic Unemployment Assistance (PUA)(benefits for self-employed and independent contractor workers), Pandemic Emergency Unemployment Compensation (PEUC)(extension benefits), Pandemic Unemployment Compensation (additional benefits because of COVID), Mixed Earner Unemployment Compensation and FED-ED.  These benefits are no longer payable after September 4, 2021, except for FED-ED which is no longer payable after September 11, 2021.

Counties should anticipate an increase in voluntary mid-period reports because of the end of these programs.  These reports may be made in writing, online, verbally, or in person. Counties can act on these reports only if they increase benefits.

For CalWORKs, an increased grant because of decrease in income is effective the first of the month in which the change occurred or is reported, whichever is later.  The recipient must provide verification of the change within 10 days of the county requesting verification.  Adequate verification can include, but is not limited to, a letter from the Employment Development Department, an Income Eligibility Verification System report, or, when other verification does not exist, a sworn statement.  The same rules apply to Refugee Cash Assistance, Entrant Cash Assistance, and Trafficking and Crime Victims Assistance Program.

For CalFresh, when a reported change results in an increase in benefits, the change must be effective no later than the first allotment issued 10 days after the date the change is reported.  Counties cannot request verification unless the income change is over $50 the income source has changed, or the change would results in an increase in benefits.  Counties must inform the household in writing of required verification. (ACWDL, September 3, 2021.)