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Chapter 6 - Income Disregards and Deductions
INTRODUCTION 6.1
When determining program eligibility and the level of benefits for which a group is eligible, certain deductions are made from the group's gross income. Some deductions can only be used to reduce a group's earned income while others can reduce a group's total gross income, including unearned income.
An earned income disregard is one form of an income deduction. An earned income disregard reduces the amount of a group's earned income that is considered when determining eligibility and/or benefit levels.
Some income deductions depend on the extent to which the group incurs certain costs such as child care, medical, or shelter costs.
A deduction from income can never reduce income below $0 (i.e. if a group is eligible for a $134 standard deduction in FS but the group only has $100 in income, the group's income is reduced to $0 by the standard deduction, but it is not reduced below this level).
By reducing the amount of income that is counted when determining whether a group meets the income eligibility criteria of a program or when calculating the level of benefits for which the group qualifies, income deductions allow groups to have higher incomes and still qualify for benefits. Income deductions, particularly earned income disregards, can reduce the extent to which benefits are reduced as earnings increase, thereby providing an incentive for groups to increase their earnings.
To determine the household's net income, subtract applicable deductions and disregards from gross income.
LEGAL AUTHORITY 6.2
AREA/TOPIC DISTRICT FEDERAL Income Disregards and Deductions TANF: D.C. Code 4-205.5; 4-205.11; 4-205.36-37; 4-205.52(a); 29 DCMR 5814 et seq.
GC: See TANF and D.C. Code 4- 205.5a MA: 42 USC 1396a(l), 1396a(m), 1396a(r)(2), 1396u-1; 42 CFR 435.601, 435.602, 435.811, 435.831 TANF: 45 CFR 260, Subpart A FS: 7 USC 2014(e); 7 CFR 273.9(d); 273.10(e)
INCOME DISREGARDS AND DEDUCTIONS 6.3 MA AR: Deduct the following two items from earned income in the order presented. (1) Earned Income Disregard Deduct $90 plus $30 and one-third of the remainder from the unit's gross earned income for expenses.