(a)

1. (1) When it is determined that a participant has received a transitional employment assistance (TEA) cash assistance or Work Pays payment to which he or she was not entitled, an overpayment report may be required.

2. (2)

   1. (A) An overpayment report will begin with the second month following the month in which the change causing the ineligible or reduced payment occurred.
   2. (B) For situations in which the participant is ineligible at application, the overpayment will begin with the month of approval.
3. (3) If the change was reported and acted upon so that the correct assistance amount was issued in the second month following the change, then an overpayment report is not required.

(b) Income.

1. (1) The process for calculating a TEA and Work Pays overpayment due to income is described below.

2. (2) TEA.

   1. (A)

(i) To determine a TEA overpayment involving income, the caseworker will determine the monthly gross and net income as outlined in 20 CAR § 502-501 et seq.

1. (ii) Unless a significant change occurred in the income during the overpayment period, the same monthly net income will be used to determine income eligibility for all overpaid months.

   1. (iii) In addition, the same gross monthly income will be used to determine if an eligible family was eligible for a full or reduced payment unless a significant change occurred during the overpayment period.

      1. (iv) Refer to 20 CAR § 503-403 for the definition of a significant change in income.
      2. (v) It is not necessary to verify the actual income in each month of the overpayment period.

   2. (B)

      1. (i) If earned income is involved, both the twenty percent (20%) and the applicable work incentive (fifty percent (50%) or sixty percent (60%)) earned income deductions will be allowed when determining income eligibility for the overpayment period.
      2. (ii) The applicable work incentive deduction will be the percentage that was in effect during the particular over paid month.
   3. (C) The following are examples of overpayment determinations when the income exceeds the income eligibility standard and when the family is entitled to a reduced payment rather than full payment. Example 1: Mr. Jackson was approved for TEA on May 10. Two (2) months later, the eligibility worker discovered that Mr. Jackson was already working when he applied for assistance. The income made the participant ineligible at approval. An overpayment will be processed beginning with the month of approval. Example 2: Ms. Jones started working in August. She reported the employment in November. When determining the monthly income, both the twenty percent (20%) and the work incentive deduction were allowed, and the family was no longer eligible for cash assistance. The overpayment will be completed beginning with the month of October. The income amount that determined ineligibility will be used for all overpaid months unless there was a change in the work incentive deduction in any of the months. Example 3: Mrs. Davis and her two (2) children are receiving TEA benefits in the amount of two hundred four dollars ($204). Mrs. Davis became employed in November. Her gross earnings are five hundred fifty dollars ($550) per month. She reported her employment in January of the following year. After allowing the participant earned income deductions, she is income eligible based on the income standard of two hundred twenty-three dollars ($223). However, when determining the payment amount, the gross earnings exceed four hundred forty-six dollars ($446) (gross income trigger). Therefore, the family was only eligible for a reduced payment of one hundred two dollars ($102). The overpayment will be completed beginning with the month of January.

2. (3) Work Pays.

   1. (A)

      1. (i) To determine a Work Pays overpayment involving income, the worker will determine the monthly gross income for each month in which an overpayment exists.
      2. (ii) An overpayment will exist for each month in which the gross income exceeds the federal poverty level (FPL) for the household size and a Work Pays payment was received for that month.
      3. (iii) There are no allowable work deductions for Work Pays.

   2. (B) The following are examples of overpayment determinations when the income exceeds the FPL for the family size. Example 1: Ms. Brown was approved for Work Pays in October based on her declared income of nine hundred fifty dollars ($950) monthly. However, when verification of earnings was received in November, the October payment had been made and Ms. Brown’s gross income was one thousand seven hundred seventy-five dollars ($1,775). This exceeded the one hundred fifty percent (150%) FPL for her household size of two (2), and therefore she was not eligible. An overpayment exists for the October payment. Example 2: Ms. Wilson was approved for Work Pays in October. At the time of approval Ms. Wilson’s gross monthly income was one thousand nine hundred dollars ($1,900), which is below the one hundred fifty percent (150%) FPL for her household size. In December, Ms. Wilson’s income increased to two thousand one hundred fifty dollars ($2,150), which is above the one hundred fifty percent (150%) FPL. The participant continued to receive a Work Pays payment for three (3) additional months. An overpayment will be calculated beginning with the payment received for the month of February.

      1. (c) Resources (TEA cash only).
3. (1) When a case is found to be ineligible due to excess resources, the overpayment will begin with the second month following the month in which resources first exceeded the resource limit. Example: Mr. Jones receives assistance for himself and three (3) children. In February, he received a cash inheritance of four thousand dollars ($4,000), which was deposited into a bank account. Mr. Jones reported having the bank account in May, and the TEA case was closed in May for excess resources. The overpayment will be completed beginning with the month of April.

4. (2) Note. There is no resource limit for Work Pays.

   1. (d) Household member.
5. (1) In cases in which a required member has been improperly excluded from the assistance unit, an overpayment will be determined only if inclusion of such person’s needs, income, and resources would have rendered the unit ineligible, or eligible for a reduced payment when the full payment was received.

6. (2)

   1. (A) In cases in which a member has been improperly included in the assistance unit, an overpayment will be determined by excluding the person’s needs.
   2. (B) The income and resources will be determined in accordance with TEA and Work Pays policy.
   3. (C) See the examples below.
7. (3) TEA. Example 1: Mr. Thomas receives TEA cash assistance for himself and three (3) children. He reported in December that his son, John, moved out of the household in October and is now living with an aunt. This change caused a decrease in the assistance payment, and an overpayment will be reported beginning with the month of December. Example 2: Through a review conducted in December, it was determined that Mary’s grandson, John, was not attending school as required for TEA cash assistance. However, his needs continued to be included in the grant. John receives Social Security Administration benefits in the amount of forty-five dollars ($45.00). In processing the overpayment, John’s needs will be dropped. However, his income and resources will remain in the budget to determine his siblings’ continued eligibility and payment amount. The last month John attended school was September. The overpayment will be determined beginning with the month of November.
8. (4) Work Pays. Example 1: Mr. Jackson was approved for Work Pays in July. He reported his household consisted of himself and his three (3) minor children, Linda, James, and Janice. He verified monthly earned income of one thousand five hundred dollars ($1,500). During ongoing case management, the Program Eligibility Specialist discovered that Linda never lived in the home with Mr. Jackson but actually lived with her mother in another city. When dropped from the unit, the household is actually over the one hundred fifty percent (150%) FPL for three (3) people. An overpayment will be determined beginning with the month of approval. Example 2: Ms. Harris was approved for Work Pays in August. At the time of approval her household consisted of herself and her sixteen-year-old son, Mike. In September, Mike moved out of the home. Ms. Harris failed to report the change. In December, the worker discovered the change. Since there is no longer an eligible child in the home, an overpayment will be calculated beginning with November.