(b) The income reporting threshold described in subdivision (a) shall be the lesser of the following:

1. (1) Fifty-five percent of the monthly income for a family of three at the federal poverty level, plus the amount of income last used to calculate the recipient’s monthly benefits.
2. (2) The amount likely to render the recipient ineligible for federal Supplemental Nutrition Assistance Program benefits.
3. (3) The amount likely to render the recipient ineligible for CalWORKs benefits.

(c) A recipient described in subdivision (a) of Section 11265.45 shall report to the county, orally or in writing, within 10 days, when any of the following occurs:

1. (1) The monthly household income exceeds the threshold established pursuant to this section.
2. (2) Any change in household composition.
3. (3) The household address has changed.
4. (4) An incidence of an individual fleeing prosecution or custody or confinement, or violating a condition or probation or parole, as specified in Section 11486.5.

(d) When a recipient described in subdivision (a) of Section 11265.45 reports income or a household composition change pursuant to subdivision (c), the county shall redetermine eligibility and grant amounts as follows:

1. (1) If the recipient reports an increase in income or household composition change for the first through 11th months of a year, the county shall verify the report and determine the recipient’s financial eligibility and grant amount.

   1. (A) If the recipient is determined to be financially ineligible based on the increase in income or household composition change, the county shall discontinue the recipient with timely and adequate notice, effective at the end of the month in which the change occurred.
   2. (B) If it is determined that the recipient’s grant amount should decrease based on the increase in income, or increase or decrease based on a change in household composition, the county shall increase or reduce the recipient’s grant amount for the remainder of the year with timely and adequate notice, effective the first of the month following the month in which the change occurred.
   3. (C) If a recipient has reported a change in income or household composition in accordance with subdivision (c), an overpayment shall not be assessed for the following month if the county was unable to provide 10 days’ notice of the termination or reduction in benefits before the first of the month following the month in which the change occurred.
2. (2) If the recipient reports an increase in income for the 12th month of a grant year, the county shall verify this report and consider this income in redetermining eligibility and the grant amount for the following year.