HAR §17-1724.2-4. adjusted gross income as defined in 26 C

F.R. §1.36B- 1 (e) (2). The Internal Revenue Service (IRS) Form 1040 is used as a guide to identify taxable income. (1) Income included in the MAGI-based determination includes the following: (A) Wages, salaries, tips, etc.; (B) Taxable interest; (C) Tax-exempt interest; (D) Ordinary dividends; (E) Qualified dividends; (F) Taxable refunds, credits, or offsets of state and local income taxes; (G) Alimony received; (H) Business income or (loss) ; (I) Capital gain or (loss); (J) Other gains or (losses); (K) Taxable amount of IRA distributions; (L) Taxable amount of pensions and annuities; (M) Rental real estate, royalties, partnerships, S corporations, trusts, etc.; (N) Farm income or (loss) ; (0) Unemployment compensation; (P) Taxable amount of social security benefits; and {Q) Other income. (2) Income excluded from the MAGI-based determination includes the following: (A) Child support; (B) Worker's compensation; (C) Veteran's benefits; and (D) Depreciation of business expenses. (3) Deductions allowed for the MAGI-based determination include the following: (A) Educator expenses; (B) Certain business expenses of reservists, performing artists, and fee-basis government officials; (C) Health savings account deduction; (D) Moving expenses; (E) Deductible part of self-employment tax; (F) Self-employed SEP (simplified employee pension), SIMPLE (savings incentive match plan for employees), and qualified plans; 1724.2-3 0206 §17-1724.2-4 (G) Self-employed health insurance deduction; (H) Penalty on early withdrawal of savings; (I) Alimony paid; (J) IRA (individual retirement account) deduction; (K) Student loan interest deduction; (L) Tuition and fees; and (M) Domestic production activities deduction. (b) The following are exceptions to the determination of MAGI-based income: 3206 ., . (1) Lump sum amounts shall be counted only in the month received; (2) Scholarships, awards, or fellowship grants used for educational purposes (not for living expenses) shall be excluded; (3) Certain American Indian/Alaska Native income as defined in 42 C.F.R. §435.603 shall be excluded: (A) Distributions from Alaska Native Corporations and Settlement Trusts; (B) Distributions from any property held in trust that are subject to Federal restrictions and located within the most recent boundaries of a prior Federal reservation or otherwise under the supervision of the Secretary of the Interior; (C) Distributions and payments from rents, leases, rights of way, royalties, usage rights, or natural resource extraction and harvest from: (i) Rights of ownership or possession in any lands described in subparagraph (B) ; or (ii) Federally protected rights regarding off-reservation hunting, fishing, gathering, or usage of natural resources; (D) Distributions resulting from real property ownership interests related to natural resources and improvements: (i) Located on or near a reservation or within the most recent boundaries of a prior Federal reservation; 1724.2-4 §17-1724.2-4 (ii) Resulting from the exercise of federally-protected rights relating to such real property ownership interests; (E) Payments resulting from ownership interests in or usage rights to items that have unique religious, spiritual, traditional, or cultural significance or rights that support subsistence or a traditional lifestyle according to applicable Tribal Law or custom; and (F) Student financial assistance provided under the Bureau of Indian Affairs education program. (c) After applying subsections (a) and (b), as applicable, add the following to arrive at the MAGI- based income: (1) Foreign income excluded from gross income under §911 of the Code; (2) Tax-exempt interest; and (3) Tax-exempt social security income. (d) The household income is the sum of the MAGI- based income, as determined under this section, of all individuals included in the applicant's or beneficiary's household, except for the income of: (1) An individual included in his or her natural or biological, adopted, or step parent's household who is not expected to be required to file a tax return for income not exceeding the taxable year's filing threshold, regardless of whether or not the individual files a tax return; (2) A tax dependent other than a spouse or natural or biological, adopted, or step child who is not expected to be required to file a tax return for income not exceeding the taxable year's filing threshold, regardless of whether or not the tax dependent files a tax return. When §17- 1724. 2-13 (b) (2) is applied, such tax dependent shall be considered for eligibility as a separate household. The income of such tax dependent, who is described in §1 7-1724.2-13 (b) (2) , is counted in its entirety when determining the tax dependent's own eligibility. [Eff 09/30/13; am and comp NOV I 0 2016 ] (Auth: HRS §346-14; 26 C.F.R. §l.36B; 42 C.F.R. 1724.2-5 320 6