Exceptions to IRS Income Rules for MAGI Based Income

Exceptions to IRS Income Rules for MAGI Based Income A. The following are exceptions to using IRS rules for determining MAGI-based income for a household. 1. Income received in a lump sum, whether recurring or non-recurring, is counted in the month received. Recurring lump sum payments are not averaged. 2. Scholarships, awards or fellowship grants used for education purposes and not for living expenses are excluded from income. Amounts used for room and board are not excluded and count as income. 3. Certain income derived from American Indian and Alaska Native sources are excluded from income. Income that is excluded includes: a. Distributions from Alaska Native Corporations and Settlement Trusts; b. Distributions from any property held in trust, subject to federal restrictions, 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 rights of ownership or possession in any lands described in above or 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 located on or near a reservation or within the most recent boundaries of a prior federal reservation or 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. f. Student financial assistance provided under the Bureau of Indian Affairs education programs. 4. Social Security benefits that are not taxable income under IRS rules are countable as income for MAGI purposes for all insurance affordability programs, including Medicaid and CHIP.