3003-1 Countable Income

3003-1 COUNTABLE INCOME

3003-1 A. EARNED INCOME

1. Wages

a. Definition:

Earned income includes, but is not limited to: monetary compensation for services as an employee, including gross earned income before any deductions or garnishments, COLA Cost of Living Allowance , leave cash-outs, vacation pay, bonuses, stipends and back-pay, advances, tips (as reported by the employee) and commissions, severance pay, military pay, and earnings from on-the-job training programs under the Workforce Investment Act.

Income from babysitting, housekeeping, craft sales, fishing, etc. is considered wages unless the applicant is claiming self-employment.

Exception: Income earned through the MASST Mature Alaskans Seeking Skills Training is not countable.

b. Verification:

Acceptable verification includes, but is not limited to, employer's statement which is signed and dated, employer's wage record, paycheck stub, or military LES Leave and Earning Statement .

Note: For more information on how to treat military pay, please see MS 3003-5 of this manual.

2. Jury Duty Payments and Witness Fees

a. Definition:

Jury duty payments and witness fees issued to the applicant count as earned income in the month received. Any portion of a jury duty payment or witness fee that is designated as a reimbursement for items such as food, lodging, parking or transportation is excluded income.

b. Verification:

Acceptable verification includes a copy of their check, check stub or official letter.

Exception: Jury duty payments issued directly to the employer are exempt income.

3. Self-Employment Income

a. Definition:

Self-employment includes occupations such as small business, crafts, boarding house manager/owner, ownership of rental property, and seasonal self-employment such as fishing. Heating Assistance uses net self-employment from the previous 12-month period, after allowable deductions. See Section 3003-4 of this manual for more information on self-employment.

b. Verification:

The applicant is responsible for verifying all income and expenses claimed. Acceptable sources of verification are tax records (such as Form 1040 and Schedules C, E, K, S1), bookkeeping records, and account statements. Written or verbal verification of self-employment income and expenses is required.

4. Tips or Gratuities

Verification includes pay stubs that list the tips, statement from applicant, or the EIS Eligibility Information System CANO Case Notes screen. A client's verbal or written statement is acceptable verification of tips received.

3003-1 B. UNEARNED INCOME

1. Public Assistance

a. Definition:

Public assistance income includes TANF Temporary Assistance to Needy Families payments (Alaska Temporary Assistance Program and Native Family Assistance) and APA Adult Public Assistance payments (Aid to the Disabled, Aid to the Blind, Old Age Assistance, Interim Assistance). ATAP Alaska Temporary Assistance Program diversion payments are also countable.

b. Verification:

Verify through the DPA Division of Public Assistance case files or EIS Eligibility Information System computer screen, or Native Family Assistance agency. A copy of their check is also acceptable verification.

Exceptions: Reductions due to Fraud: When a TANF Temporary Assistance to Needy Families or APA Adult Public Assistance benefit is reduced to repay a fraud overpayment, the calculation of the heating assistance benefit will use the TANF Temporary Assistance to Needy Families or APA Adult Public Assistance amount the household would have received without the grant reduction. This applies only if a formal fraud finding has been determined by the administrative disqualification process or a conviction by court.

2. SSI Supplemental Security Income / SSA Social Security Administration / VA Veteran Affairs Income

a. Definition:

Social Security benefits ( SSA Social Security Administration ) - retirement, survivor's disability and dependent benefits; Supplemental Security Income ( SSI Supplemental Security Income ) - aged, blind and disabled person's benefits; and Veteran's benefits are considered unearned income.

b. Verification:

Verify with a copy of the current check, current Social Security or VA Veteran Affairs award letter, a statement from Social Security or Veteran's Administration verifying the monthly amount, SDX/Bendex printouts, EIS Eligibility Information System interface screen. VA Veteran Affairs can also be verified using a bank statement since VA Veteran Affairs benefits are not subject to deductions or by calling the Veteran's Administration office at 1-800-827-1000.

c. Budget:

The monthly entitlement including the cost of Medicare, if deducted, is counted as income in the month of intended use.

3. Child Support Payments

a. Definition:

Child support income includes:

Payments received from the non-custodial parent or a child support enforcement agency, including full or partial monthly obligation payments, payments toward obligation arrearage, and voluntary payments.

Payments paid by the non-custodial parents to a third party to pay for a household expense may be countable. Please see the examples below for clarification.

CSED Child Support Enforcement Division pass-through payments paid through DPA Division of Public Assistance or a Native Family Assistance Program agency to a TANF Temporary Assistance to Needy Families recipient.

EXAMPLE #1: A court order specifies Harry must pay child support of $500 per month cash to be sent to the family and $800 per month be paid to the landlord (or directly to the mortgage company). Because the $800 cannot be given to the family in cash (per the court order), it's not considered income. Only the $500 cash that goes to the family is considered income.

EXAMPLE #2: A court order states that Melinda, the absent parent, must pay $450 per month to the family for child support. Melinda makes that payment plus sends $250 per month to the landlord to help with the rent. The $250 is a gift (the family is not legally entitled to it) so it is exempt income.

EXAMPLE #3: A court order specifies that Joe, the absent parent, must pay $450 to the household as child support. At the custodial parent's request the $450 is sent to the landlord for rent instead. The custodial parent is legally entitled to the $450 which could be paid in cash; therefore, the income is countable income.

Exception: Funds provided and used for the care of a child not living at home and the funds are sent to the child are exempt and not countable.

b. Verification:

Includes, but not limited to, CSED Child Support Enforcement Division computer screen, the CSED Child Support Enforcement Division payment stub, a signed statement from the non-custodial parent, the EIS Eligibility Information System CANO Case Notes , a court order showing the amount of the award, or a check stub.

c. Budget:

When the person receiving child support is a TANF Temporary Assistance to Needy Families recipient:

CSED Child Support Enforcement Division pass-through payments paid through DPA Division of Public Assistance or a Native Family Assistance Program agency to a TANF Temporary Assistance to Needy Families recipient are counted as unearned income.

Only the first $50 per month received and kept by TANF Temporary Assistance to Needy Families recipients directly from the non-custodial parent is countable. The remainder is considered assigned child support and is excluded income. Assigned child support is child support given or paid to TANF Temporary Assistance to Needy Families recipients that should be turned over to a child support agency to maintain TANF Temporary Assistance to Needy Families eligibility.

Child support payments received by TANF Temporary Assistance to Needy Families recipients from a child support enforcement agency are disbursements and are countable income. However, payments made in error are excluded income.

Note: A TANF Temporary Assistance to Needy Families applicant becomes a recipient the moment the caseworker authorizes the TANF Temporary Assistance to Needy Families benefit in EIS Eligibility Information System . All direct child support payments received and kept prior to this authorization is countable income.

4. Third-Party Payee

a. Definition: Payments made to a third-party payee on behalf of a recipient. For example, SSI Supplemental Security Income , SSA Social Security Administration , and ATAP Alaska Temporary Assistance Program payments assigned to payees who represent recipients unable to manage the payments.

b. Verification: Includes, but not limited to, a signed statement from the agency that designated the third-party beneficiary, and a copy of the checks received.

5. Educational Income

Any portion of education assistance that will NOT be used or set aside for paying tuition, fees, or other necessary education expenses is countable unearned income.

Exception: Education assistance that is not funded under Title IV of the Higher Education Act or the Bureau of Indian Affairs student assistance program funds is excluded as income if it is used or will be used for paying tuition, fees, or other necessary education expenses at any educational institution, including vocational, technical, and correspondence schools, and schools for people with disabilities.

6. Other Sources of Countable Unearned Income

The following are considered other sources of unearned income (not all-inclusive):

a. Worker's Compensation;

Verification: Acceptable verification includes a fax, e-mail, or statement from Worker's Compensation or from the EIS Eligibility Information System CANO Case Notes screen.

b. Unemployment Insurance Benefits (UIB), including amounts garnished. Refer to HAP MS 3003-1C for more information on garnishments.

Verification: Acceptable verification includes DOL Department of Labor 's BB53 screen, statements from other states regarding disbursement amounts, or from the EIS Eligibility Information System CANO Case Notes screen.

c. Annuities, pensions, retirement, and disability benefits;

Verification: Acceptable verification includes EIS Eligibility Information System CANO Case Notes screen, benefit statement or award letter, year-end statement or a R-1099.

Note: Annuity payments paid quarterly shall be averaged over the three months and counted as monthly income; annuity payments paid annually shall be averaged over twelve months and counted as monthly income.

d. SBS payments and cash outs;

e. Alimony payments;

Verification: Acceptable verification includes the EIS Eligibility Information System CANO Case Notes screen, a court order showing the amount awarded, or a check stub.

f. Rental income (gross income minus costs of doing business).

Costs of doing business may include the mortgage, taxes, and insurance. When a household member is actively engaged in the management of the property at least 20 hours per week, it will be considered earned income.

Note: Rental income received in a lump sum shall be averaged over the months of intended use and counted as monthly income. Income received from the lease of a limited entry fishing permit is considered unearned rental income.

g. Foster care payments;

The total foster care payment made to a household for a legally assigned foster child or adult, if the foster child/adult is included as a member of the household. If the child/adult is not included, the foster care payment is not included as income to the household. In cases where the foster person is an adult that is not considered a member of the household, the foster adult must be considered a household sharer or room renter.

Verification: Acceptable verification includes check stubs or the EIS Eligibility Information System CANO Case Notes screen.

h. Dividends, interest, royalties, estates, trusts and similar recurring payments;

Verification: Acceptable verification includes a bank statement, letter declaring the amounts, EIS Eligibility Information System CANO Case Notes screen, or statements from the trust regarding the disbursement amounts.

Exception: The Heating Assistance Program does not count Alaska PFD Permanent Fund Dividend s unless it is received by a household for a person who is not a household member.

i. Excess reimbursements;

When payments received as an advance or reimbursement for volunteer job training or work-related services exceed the expense incurred, the excess amount is included as income.

j. Strike benefits;

Verification: Acceptable verification includes a copy of their check or a statement from the union.

k. Cash payments, including payments to a household from a wage earner not residing with the household because of his or her employment.

Verification: Acceptable verification includes the EIS Eligibility Information System CANO Case Notes screen or a statement from the person providing the cash gifts.

l. Military family allotments;

Verification: Acceptable verification includes the EIS Eligibility Information System CANO Case Notes screen or their Leave and Earnings Statement.

Note: For more information on how to treat military pay, please see MS 3003-5 of this manual.

m. Any money benefit not otherwise exempted including lump sum payments unless specified as not countable;

n. Bingo and lottery winnings;

Verification: Acceptable verification includes the EIS Eligibility Information System CANO Case Notes screen, a Bingo/Pull Tab statement, or a letter from the game provider.

Note: Lottery winnings paid on an annual basis shall be averaged over twelve months and counted as monthly income.

o. BIA Bureau of Indian Affairs General Assistance Program payments made to the household;

Verification: Acceptable verification includes the EIS Eligibility Information System CANO Case Notes screen, a check stub, or a letter from the BIA Bureau of Indian Affairs office.

p. Refugee cash assistance payments;

Monthly refugee cash assistance payments made through the Refugee Assistance & Immigration Services program administered by Catholic Social Services are countable income. See Administrative Procedures MS 128-4 for more information about refugee assistance.

q. Subsidized adoption payments;

Are intended to cover expenses incurred due to the special needs of an adopted child. These payments are countable for Heating Assistance.

Verification: Acceptable verification includes EIS Eligibility Information System CANO Case Notes screen, Native Family assistance agency, TANF Temporary Assistance to Needy Families records, or a check stub.

r. Cash gifts over $20 per person, per month;

s. Income from the sale of stocks or bonds or escrow income;

Verification: Acceptable verification includes a letter regarding the condition of the payment or a bank statement.

t. Payments from the sale of personal property, house, boat, loan repayment, and escrow repayments;

u. Trade Readjustment Act payments;

v. Capital Gains;

Verification: Acceptable verification includes IRS Internal Revenue Service Form 1040 or the EIS Eligibility Information System CANO Case Notes screen.

w. Natural Resource Conservation Service Grants;

Grants awarded through the NRCS National Resource Conservation Service to improve water management and/or improve resource conditions.

Verification: Acceptable verification includes a copy of the grant award or award letter showing the total grant amount and the period of time represented by the award (6 months, 1 yr, 2 yrs).

x. Health Care Stipends;

Money received by an applicant from their employer to purchase health care insurance in the open market.

Verification: Acceptable verification includes a copy of the applicant's pay stub or separate check to the applicant indicating they are receiving funds to purchase health insurance (instead of the employer providing the actual insurance).

Note: If the cost of employer provided health insurance is included in the applicant's paycheck as an employee benefit (for example, the State of Alaska provides employee health insurance as a fringe benefit), the benefit is non-countable income.

3003-1 c. GARNISHMENTS

Garnishments are funds withheld from an income source due to an outstanding debt a person is legally obligated to pay. Garnishments are always made by direction of a court order. The amount withheld for the garnishment is counted when determining the gross income from any source.

The amount and reason for withholding of funds from any source must be verified in order to determine if the funds were withheld due to a garnishment or a recoupment. Refer to HAP MS 3003-2A for information on recoupments.

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