This chapter reports on an agent-based modeling project to simulate the implementation of a targeted subsidies plan (TSP) in Iran, which was conducted as one of the case studies in the Artificial Intelligence for Assessment (AI-FORA) research project. The model aims to examine the dynamics of the targeted subsidies plan and assess the effectiveness of related policies, such as paying subsidies to the lower deciles of households, and their impact on income inequality and improving the welfare of low-income households. In this model, households are considered the key agents. Based on the targeted subsidies plan, households are divided into different income deciles according to various parameters such as income, assets, number of household members, foreign trips, and bank transactions (a total of 260 information fields). Each year, a budget is allocated by the government for the TSP, and subsidies are paid to low-income deciles (in this simulation, to the 4 low-income deciles). In the early years of the plan’s implementation, equal subsidies were paid to different deciles, but in the past few years, the plan has purposefully calculated a different subsidy to be paid to each decile. Additionally, in this simulation, the dynamic behaviors of households, including income generation, consumption, and savings, as well as sudden income jumps or bankruptcy, are considered to be closer to the reality of society. Finally, the impact of the policy on income distribution, poverty reduction, and household welfare is analyzed. In future work, in this research, we will try to examine the relationships between households and add the effects of macroeconomic parameters, such as inflation, in the simulation.