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Chapter: 1800 Income Program: TCA 28 1820.0200 EARNED INCOME (TCA) Earned income includes all gross (before taxes or other deductions) wages and salaries from performance of work (including wages deferred that are beyond the individual's control). Wages are included as income at the time they are received rather than when earned.

Wages are considered earned income even when withheld at the request of the employee or provided as an income advance on income expected to be earned at a future date. Advances are different from loans since they are paid in exchange for anticipated services or labor.

An individual is considered employed when engaged in a business, occupation or service for cash paid by another person, group of persons or company. Wages or paid salaries received after employment has ended are considered earned income (except for severance pay, which is unearned income). An example of this type of wage is payment for accrued vacation time.

Employer-provided sick pay is earned income as long as the individual plans to return to work after recovering and is still considered an employee. Sick pay is a continuation of salary with normal payroll deductions and is not to be confused with benefits, such as Workers' Compensation, that are considered unearned rather than earned income. 1820.0204 Sale of Blood or Plasma (TCA) Income derived from the sale of blood or plasma is included as earned income. 1820.0206 Tips (TCA) The amount of tips reported by the employee will be included as income. Many times an employer will include on the pay stub of the employee an amount the employer must report to the IRS for tax purposes. This is an allocated amount and cannot be interpreted as the amount actually earned or received by the employee. The tip amount reported by the employee can be accepted unless questioned.

In some instances, the employee reports actual tips to the employer. In this instance, the employer can verify actual tips earned. The individual should keep records on a daily basis if the tips are not reported to the employer, so this information can be used for verification. 1820.0207 Verification of Earned Income (TCA) All non-exempt earned income must be verified at application and review unless otherwise specified.

All non-exempt earned income must be verified by the employer. Information that must be verified includes:

1. the first and last dates of employment, 2. the first and last day of pay, 3. gross income including overtime and tips, 4. frequency of payment, 5. the day of the week payment is received, and 6. the number of hours and days employed.

Note: Verification of terminated income from the employer, including the amount and date of last pay, is only required for an applicant when income is received in the month of application. The individual’s statement is acceptable for income terminating prior to the month of application.