Update PolicyEngine US to 1.712.1

[policyengine]

Summary

Update PolicyEngine US from 1.702.0 to 1.712.1.

What changed (1.702.0 -> 1.712.1)

Added

• Added Slack notices for partner API contract test changes.
• Added coding-agent guidance for partner API contract tests and removed stale working references.
• Add an annual approximation of the 2018-2019 Arkansas Works Medicaid work requirement.
• Added Alabama senior homestead property tax relief.
• Add Arizona MCTCP subtraction (Executive Order 2025-15) propagating the OBBBA federal enhanced senior, tip, overtime, and auto loan interest deductions to AZ subtractions starting 2025.
• Added the Medicaid long-term care home equity limit from H.R. 1.
• Cap traditional and Roth 401(k) and 403(b) contributions at the IRC Section 402(g) elective deferral limit, including age-based catch-ups.
• Implement Missouri State Supplementary Payment (SAB and SNC components) under DSS Family Support Division.
• Add Maryland Public Assistance to Adults (state SSP).
• Added the Indiana Over 65 Property Tax Credit.

Changed

• • Made Medicaid cost if enrolled data-backed and used Medicaid enrollment, rather than the Medicaid dollar value, for categorical eligibility checks.
• Update Medicaid work requirement eligibility to reflect CMS community engagement guidance.

Fixed

• Fixed YAML syntax error in partner API impact notice workflow.
• Validate changed changelog fragment paths in pull request CI.
• Apply rate cap before deducting copay in DC, NJ, SC, RI, PA, ME, MA, VA, and DE child care subsidy formulas, so the family copay is properly deducted from the state's max reimbursement when expenses exceed the cap.
• Model the recent incarceration exception for Medicaid community engagement requirements.
• Deduct the Parent Share of Cost from Texas Child Care Services when childcare expense exceeds the Board's maximum reimbursement rate.
• Prevent a net capital loss in the Delaware pension exclusion basket from producing a negative subtraction that wipes out other DE subtractions.
• Fixed RuntimeWarning: invalid value encountered in divide in qbid_amount when the QBI phaseout length parameter is zero. The unguarded (taxinc_less_qbid - po_start) / po_length is now np.divide(..., where=po_length > 0) with a fully-phased-out fallback. Resolves the QBI source of the divide warnings tracked in #8216.
• Add regression tests asserting Roth 401(k) and 403(b) contributions do not reduce taxable wages, and document the exclusion in the pre-tax contributions parameter.
• Traditional 401(k) and 403(b) elective deferrals no longer incorrectly reduce the FICA (Social Security and Medicare) wage base. Under IRC §3121(a), only Section 125 cafeteria plan items (employer-sponsored health premiums and HSA payroll contributions) reduce FICA wages. This fixes understated Social Security and Medicare tax in any simulation with retirement deferrals.

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[codecov]

Codecov Report

✅ All modified and coverable lines are covered by tests.
✅ Project coverage is 78.01%. Comparing base (9b249e5) to head (801d7a5).
⚠️ Report is 2 commits behind head on master.

Additional details and impacted files

@@           Coverage Diff           @@
##           master    #3632   +/-   ##
=======================================
  Coverage   78.01%   78.01%           
=======================================
  Files          67       67           
  Lines        4071     4071           
  Branches      759      759           
=======================================
  Hits         3176     3176           
  Misses        700      700           
  Partials      195      195           

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