section-13 DETERMINING INCOME

A. Definition For the purpose of determining SNAP benefit eligibility the following definition applies: 1. Income Household income includes all income earned and unearned from any source, excluding only those items specified in this Section. B. Earned Income Earned Income shall include: 1. Earnings as an Employee a. All wages and salaries for services performed as an employee. b. Additional funds provided for work-related expenses, if not excluded as reimbursement, as described in this section. For household members who are employed in the armed forces, the countable military earnings include but are not limited to the Basic Allowance for Housing (BAH), if received. 2. Self-Employment Income a. The total gross income from a self-employment enterprise, including the total gain from the sale of any capital goods or equipment related to the business, [but] excluding the costs of doing business as described in this section. b. Income derived from ownership of rental property is considered earned income from a self- employment enterprise if a member of the household is actively engaged in the management of the property for an average of 20 hours a week or more. If management of the property entails less than 20 hours a week, the rental income is considered unearned income. c. Payments from a roomer or boarder. 3. Training Allowances Training allowances from vocational and rehabilitation programs recognized by federal, State or local governments to the extent that they are not a reimbursement. Training allowances under Job Training Partnership Act are excluded from consideration as income. 4. Workforce Investment Act (WIA) Earnings for individuals who are participating in on-the-job training programs under the Workforce Investment Act (WIA), which includes money paid under the WIA and money paid by the employer. However, WIA on-the-job training earnings received by household members under 19 years of age who are under the parental control of another adult household member, regardless of school attendance or enrollment, is excluded. 5. Youth Opportunity Program Payments under the Youth Opportunity Program administered by the New York State Office for People With Developmental Disabilities, unless the payment is a reimbursement. However, the earned income of certain children is excluded. 6. Safety Net Assistance (SNA) Plan of Self-Support Earned income disregarded for TA purposes under a SNA Plan of Self–Support is counted as earned income for SNAP purposes. 7. Subsidized Employment Income All subsidized employment income, including Transitional Employment Advancement Program (TEAP), Transitional Jobs Program, Health Care Jobs Program and Green Jobs Corp Program shall be treated as earned income for SNAP purposes. 8. Payments Under Title I of the Domestic Volunteer Service Act of 1973 Payments under Title I (VISTA, University Year for Action, etc.) of the Domestic Volunteer Service Act of 1973 shall be considered earned income and subject to the earned income deduction. Food stamp recipients who have VISTA earnings excluded because they were receiving temporary assistance or food stamps when they joined VISTA will continue to have their VISTA income excluded. This exclusion of a food stamp recipient’s VISTA income continues even if there are temporary (less than six month) interruptions in their SNAP participation. References: 7 CFR 273.9(b) – Income and Deductions 387.10 - Income Standards 92 ADM-37 Home Relief (HR) Plan of Self-Support 05 ADM-14 Food Stamp Budgeting: VISTA Payments and Medical Mileage Expenses 94 INF-7 Treatment of Payments from Youth Education, Employment and Training Programs 12 INF-08 The Treatment of Subsidized Employment as Earned Income for the Food Stamp Program C. Unearned Income Unearned income includes, but is not limited to: 1. Assistance Payments a. From federal or federally aided programs, such as Supplemental Security Income (SSI) or Family Assistance (FA) payments, or other assistance programs based on need, such as Safety Net Assistance (SNA) or Family Subsistence Supplemental Allowance Payments (SNAPSA) paid by the Armed Forces. NOTE: The "visitor's allowance" (See TASB Chapter 13) paid to a parent whose SNAP household does not include the child is not counted as TA income to that parent's SNAP case. Exception - A one-time and special assistance payment is excluded for SNAP budgeting purposes if the payment meets one of the following criteria: (1) The payment is a TANF diversion payment, which are nonrecurrent, short-term benefits that are designed to deal with a specific crisis situation or episode of need, are not intended to meet ongoing needs, will not extend beyond four months, and the family did not receive a regular TANF payment in the current or prior month; or (2) The payment is a reimbursement for past or future expenses, to the extent that it does not exceed actual expenses, is provided for a specific purpose other than normal living expenses and is used for the purpose intended; or (3) The payment is a non-recurrent lump sum, such as a retroactive TA payment. For SNAP benefit eligibility and budgeting purposes, a lump sum is excluded as income, but counted as a resource in the month received. b. Derived from programs which require, as a condition of eligibility, the actual performance of work without compensation other than the assistance payments. c. An out-of-state TA payment that was intended to meet basic needs must be counted as unearned income when determining a household's SNAP benefit amount for the month in which the TA payment was received. 2. Annuities, pensions, retirement, veterans' or disability benefits, workers' or unemployment compensation, old-age, survivors, or Social Security benefits and strike benefits. Note: Retirement accounts that were previously not accessible to the household that become accessible to the household, and in which the individual begins to receive payments or in which the individual chooses early withdrawal would qualify as unearned income. Retirement accounts such as IRAs, that become accessible to the household, shall be treated as unearned income in the month received or dispersed over 12 months at district discretion. 3. Gross income (minus the cost of doing business) derived from rental property in which a household member is not actively engaged in the management of the property at least 20 hours a week. 4. Support or Alimony Payments a. Payments made directly to the household from non-household members: Child support is considered the income of the person to whom it is legally obligated, usually the custodial parent. The total amount of the child support shall be counted as income to the person to whom it is legally obligated regardless of whether the child is a household member or non-household member. b. Only the IV-D child support pass-through which was received by the household within normal processing time frames is countable as income. The pass-through payment is counted as SNAP income in the month following the month in which the household receives the pass-through. Additional payments of arrears received in a non-recurring lump sum are not considered income. However, if the arrears payments are recurring and will be received in multiple months, the payments must be added to the normal child support amount and counted as unearned income. However, these support payments for previous months are counted as resources for non- categorially eligible SNAP households. 5. Adoption Subsidy Payments Adopted children are required members of a SNAP household. The amount of adoption subsidy payments in excess of allowable, verified, reimbursable, expenses shall be considered unearned income. a. Reimbursements for normal household living expenses such as rent or mortgage, utilities, personal clothing, or food eaten at home are a gain or benefit to the household and, therefore, may not be excluded as income. Reimbursement for any other expense may be excluded as income as set forth below: (1) Reimbursements for past or future expenses, to the extent that they do not exceed actual expenses incurred, may be excluded as income. (2) To be excluded as a reimbursement, a payment must be provided for a specific identified expense, other than normal living expenses, and used for the purpose intended. When a reimbursement, including a flat allowance (such as an adoption subsidy), covers multiple expenses, each expense does not have to be separately identified as long as none of the reimbursement covers normal living expenses. The amount by which a reimbursement exceeds the actual incurred expense shall be counted as income. Example: A SNAP household that is receiving an adoption subsidy payment of $500 per month. If the household has verified reimbursable expenses – e.g., school activities and music lessons - that average $75 per month, then $425 of that adoption subsidy payment would be considered to be income when assessing eligibility and when calculating a SNAP benefit. 6. Foster care/KinGap Payments Foster children are NOT required members of a SNAP household. The household has the option of including foster child/children in their SNAP case. When foster child/children are included in the SNAP case any foster care/KinGap payments that are in excess of allowable, verifiable, reimbursable expenses shall be considered unearned income. When foster child/children are not included in the SNAP case the associated foster care/KinGap payments shall be excluded as income. a. Reimbursements for normal household living expenses such as rent or mortgage, utilities, personal clothing, or food eaten at home are a gain or benefit to the household and, therefore, may not be excluded as income. Reimbursement for any other expense may be excluded as income as set forth below: (1) Where the child is included in the SNAP household, only that portion of the foster care payments that exceeds the sum of all the excluded reimbursements is counted as income. (2) To be excluded as a reimbursement, a payment must be provided for a specific identified expense, other than normal living expenses, and used for the purpose intended. When a reimbursement, including a flat allowance, covers multiple expenses, each expense does not have to be separately identified as long as none of the reimbursement covers normal living expenses. The amount by which a reimbursement exceeds the actual incurred expense shall be counted as income. 7. Military pay, excluding additional pay based on deployment to a combat zone, that is made available to a household by a service person who is not a member of the SNAP household. 8. Veterans' educational benefits for general living expenses a. Dividends, except dividends from insurance policies b. Interest, except interest from funeral agreements or accounts. This includes interest earned from an excluded retirement account c. Royalties 9. Monies which are withdrawn or dividends which are or could be received by a household from trust funds are considered excludable resources. Such trust withdrawals shall be considered income unless otherwise exempt under Section 12. Dividends which the household has the option of either receiving as income or reinvesting in the trust are considered as income in the month they become available to the household, unless otherwise exempt. 11. FEMA payments to homeless people to pay for rent, mortgage, food, and utility assistance when there is no major disaster or emergency. 12. All other direct money payments from any source which can be considered a gain or benefit. This includes income that is legally obligated to the household but diverted by the household. For example, Social Security benefits that are diverted by the recipient into a Supplemental Needs Trust account remain countable as income to the household. References: 387.10 - Income Standards 7 CFR 273.9(b)(2) – Unearned Income 11 ADM-05 Temporary Assistance Budgeting: Treatment of Kinship Guardianship Assistance Program (KinGAP) Payments 08 ADM-04 Treatment of Income From Adoption Subsidy Payments and Foster Care Payments in Determining Food Stamp Program Eligibility and Benefit Amount 09 ADM-19 Changes to Assignment of Support Rights and Child Support Distribution for Recipients of Temporary Assistance 02 ADM-07 Food Stamp Program Reauthorization Changes 01 ADM-07 Food Stamp and Temporary Assistance Treatment of Family Subsistence Supplemental Allowance Payments 00 INF-16 Temporary Assistance (TA), Food Stamps (SNAP), and Medicaid (MA) Budgeting: Out-of-State Temporary Assistance Payment PA Budgeting and Case Category for Joint Custody Cases D. Income Of Ineligible Individuals 1. Intentional Program Violations, Individuals Sanctioned For Failure To Comply With Work Requirements Or Fleeing Felons The earned or unearned income of an individuals determined ineligible because of disqualification for Intentional Program Violation, for failing to comply with a SNAP work requirement or because of fleeing felon status must be counted in its entirety to the remaining household members. 2. Ineligible Aliens, Ineligible ABAWDs, or An Individual Who Refuses To Apply For Or Provide A Social Security Number A pro rata share of the earned or unearned income of an individual determined ineligible for being an ineligible ABAWD or ineligible alien or for refusal to apply for or provide an SSN shall be counted as income to the remaining household members. This pro rata share is calculated as follows: a. Subtract allowable income exclusions from the ineligible individual’s income; b. Divide the remaining countable income evenly among the household members including the ineligible individuals; c. Subtract the ineligible individual’s share; and d. Count all but the ineligible individual’s share as income to the remaining household members. e. Resources. The resources of such ineligible members shall continue to count in their entirety to the remaining household members for households not considered categorically eligible for SNAP, f. Deductible expenses. The 20 percent earned income deduction shall apply to the prorated income earned by an Ineligible Alien, Ineligible ABAWD or an individual who refuses to apply for or provide an SSN which is attributed to their household. That portion of the household’s allowable child support payment, shelter and dependent care expenses which are either paid by or billed to the ineligible members shall be divided evenly among the households' members including the ineligible members. All but the ineligible members' share is counted as a deductible child support payment, shelter or dependent care expense for the remaining household members. The ineligible alien, ineligible ABAWD, or an individual who refuses to apply for or provide an SSN shall not be included when determining the household’s size for the purposes of: 1. Assigning a benefit level to the household; 2. Assigning a standard deduction to the household; 3. Comparing the household's monthly income with the income eligibility standards; or 4. Comparing the household's resources with the resource eligibility limits. 3. Ineligible Student The earned or unearned income of an individual determined to be an ineligible student cannot be considered available in determining household eligibility or benefit levels. NOTE: Cash payments to a participating household by an ineligible student or work registration sanctioned individual are considered income. NOTE: If a SNAP household includes an individual who is disqualified as an ineligible ABAWD, an ineligible alien or for failure to provide a SSN according to paragraph 2, above and who is also an ineligible student (as described in Section 5), the budgeting rules described in paragraph 2, above take precedence. References: 387.10 - Income Standards 387.16 – Special Provisions for Household Circumstances E. Sponsored non-Citizens And Income Deeming Most non-citizens that immigrate to the United States because of family relationships or certain employer relationships must have a sponsor. Sponsors must prove that they can provide enough financial support to their sponsored non-citizens, so that they do not have to rely on public benefits. In determining a sponsored non-citizen’s eligibility for SNAP benefits, a portion of the sponsor’s income and resources are deemed as available to the sponsored non-citizen. 1. Which non-citizens are subject to sponsor deeming requirements? The deeming requirements apply only to a SNAP eligible Lawful Permanent Resident (LPR) whose sponsor has signed a legally binding affidavit of support (known as 213A affidavit-Form I-864 or I-864A) on or after December 19, 1997. The only LPRs with legally enforceable affidavits are family-sponsored LPRs, including immediate relatives, and a few employment-based LPRs who came to the United States to work for relatives or in companies partially owned (more than five percent) by relatives AND who were beneficiaries of an I-130 Petition (Alien Relative Petition) or I-140 Petition (Immigrant Petition for Alien Worker) and applied for an adjustment to LPR status on or after December 19, 1997. NOTE: Some family-based non-citizens who became LPRs after December 19, 1997, will have an I-134 Affidavit of Support that is not legally binding and therefore are not subject to sponsor deeming, because their application for LPR status was filed before that date. 2. Which non-citizens are exempt from sponsor deeming requirements? The following groups are not subject to deeming rules: a. Children - Sponsor deeming does not apply to children who are under age 18 regardless of when they entered the United States b. Battered Spouse or Child Exception - Deeming also does not apply during any 12-month period if the non-citizen is a battered spouse, battered child or parent, or child of a battered person provided the battered non-citizen lives in a separate household from the person responsible for the battery. The exemption can be extended for additional 12-month periods if the non-citizen demonstrates that the battery is recognized by a court, administrative order, or by the USCIS and if the district determines that the battery has a substantial connection to the need for benefits. c. Non-citizens without sponsors - In general, qualified non-citizens who enter the country under provisions of immigration law other than the family- sponsored categories do not have sponsors that have a legal obligation to support them. Included in this group are refugees, asylees, persons granted withholding of deportation, Amerasians, and Cuban or Haitian entrants d. Non-citizens whose sponsor has not signed a legally binding affidavit of support - Non-citizens, such as refugees, who are sponsored by an organization or group also fall into this category. e. Indigent Exception. - If the sum of the non-citizen's household's own income and any cash or in-kind assistance provided by the sponsor or others is less than 130% of the poverty level for the non-citizen's household, the non-citizen is considered indigent. The amount of the income and resources deemed to an indigent non-citizen cannot exceed the amount actually provided for up to a 12-month period. Each indigence determination is effective for 12 months and may be renewed for additional 12-month periods. f. Sponsor in same SNAP household. If the sponsor lives in the same household as the non-citizen, deeming does not apply because the sponsor's income and resources are already counted. However, there is no deeming exemption if the sponsor receives SNAP benefits in another household. g. Ineligible Member. If the sponsored non-citizen is ineligible for SNAP benefits because of immigration status (e.g., is not a qualified non-citizen or is an LPR without five years of residency), the sponsor's income is not deemed to other eligible members of the non-citizen's household. 3. How long sponsor deeming lasts? Deeming of the sponsor's income and resources to the sponsored non-citizen lasts until the sponsored non-citizen: a. Becomes a naturalized citizen; b. Can be credited with 40 qualifying quarters of work; c. Abandons LPR and leaves the US; d. Dies or the sponsor dies. 4. How much of the sponsor's resources are deemed to the non-citizen? If deeming applies, all but $1,500 of resources (as defined according to regular SNAP rules) of the sponsor and the sponsor's spouse are deemed to the sponsored non-citizen. Note: If the household is categorically eligible then the resources of the sponsoring household are not counted for SNAP. 5. How much of the sponsor's income is deemed to the sponsored non- citizen? The amount of the sponsor's income attributed to the sponsored non-citizen is the total monthly earned and unearned income of the sponsor and sponsor's spouse, minus 20% of their earned income and minus 130% of the poverty level for a household equal in size to the sponsor's household: sponsor, sponsor's spouse if living with the sponsor, and any other person who is a dependent or receives support from the sponsor or sponsor's spouse. If the sponsor signs an affidavit of support for more than one non-citizen, the sponsor's income is prorated among the sponsored non-citizens. Income is defined according to regular SNAP rules. 6. When the non-citizen's sponsor refuses to provide information? Non-citizens who are exempt from deeming do not need to provide information about the sponsor's income and resources. However, an eligible non-citizen who is subject to deeming and is receiving support from a sponsor is responsible for obtaining the cooperation of the sponsor and for providing the district with the information and documentation necessary to calculate deemed income and resources at the time of application and recertification. The district must assist the household in obtaining the necessary verification. If necessary, district staff can obtain the sponsor’s name, address and Social Security Number through SAVE. Districts are reminded that indigent non-citizens need to verify only the amount of the income and resources actually provided by their sponsors. They must not deny an non-citizen's application for SNAP benefits on the basis of the sponsor's non-cooperation, if it can be determined that the sponsor is providing zero support to the non-citizen. 7. What is the sponsor’s liability? A sponsor who has signed a legally binding affidavit of support on or after December 19, 1997 for a non-citizen they sponsor may be liable for the value of SNAP benefits received by that sponsored non-citizen during the period of time the affidavit of support is in effect. The sponsor or the sponsor's estate is liable to repay the cost of these benefits for ten years after benefits were last received but is not liable for benefits received by the sponsored non-citizen during any period of time that the sponsor receives SNAP benefits. 8. What is the district's responsibility to enforce sponsor liability? Districts must request reimbursement from sponsors who have signed legally binding affidavits of support on or after December 19, 1997, for any SNAP benefits received by the non-citizen during the period of time the affidavit is in effect (until the non-citizen becomes a citizen, permanently leaves the country, or can be credited with 40 qualifying quarters of work or until the sponsor dies). Prior to pursuing a request for reimbursement, the district must first verify that the non-citizen's sponsor is subject to a liability by determining if the sponsor signed a legally binding Form I-864 affidavit of support, if the sponsor received SNAP benefits while the sponsorship agreement was in effect, or if the affidavit-of- support period has ended. If the liability is not paid, districts need not pursue legal action against the sponsor in federal or State courts. In addition, benefits issued correctly to sponsored non-citizens cannot be considered as SNAP benefit overpayments under the Food Stamp Act. Districts may not keep any portion of liabilities recouped from sponsors. Pending verification, the district cannot delay, deny, reduce or terminate the individual's eligibility for benefits on the basis of the individual's immigration status. 9. District’s responsibility for reporting when it determines a non-citizen "indigent" Households that the district has determined indigent should be informed that the names and addresses of the indigent sponsored non-citizen and the sponsor will be provided to the NYS OTDA, for reporting to USCIS. Districts should send the written notice, which should include the reference, "Determinations under 421(e) of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996", to: New York State Office of Temporary and Disability Assistance Division of Temporary Assistance 40 North Pearl Street, 11th floor Albany, NY 12243 References: 387.10 - Income Standards 7 CFR 273.4 - Citizenship and Alien Status 99 ADM-2 Alien Sponsorship - Deeming of Sponsor's Income and Resources 02 ADM-07 Food Stamp Program Reauthorization Changes 03 INF-14 Food Stamp Program Eligibility for Aliens F. Non-Household Individuals 1. Income Earned by Non-Household Members The income of non-household individual(s) as described in SNAPSB Section 5 must not be considered available to the household to determine household eligibility and benefit levels. Cash payments to a participating household by non-household individuals, however, are considered income. For example, when an individual is away from the household for military assignment all or part of the absent person's pay will be sent directly to the family (or deposited directly into their bank account) by the military. Any income paid directly to the household by the absent person or sent to the household by the military is considered unearned income. Such income cannot be counted in determining eligibility or benefit levels until it is determined when and what amount will be received. However, effective October 1, 2004, federal law excludes from consideration as income any additional pay received by military service persons as a result of deployment to a combat zone. If the amount of military pay that the combat-duty service person is making available is equal to or less than the amount the household was receiving from the service person prior to deployment to a combat zone, all of the available military pay would be counted as income to the SNAP household. Any portion of the amount that exceeds the amount the household was receiving prior to deployment of the military person to a combat zone must be excluded when determining the household's income for SNAP purposes. 2. Income Earned by Household and Non-Household Members When the earned income of one or more household members and the earned income of a non-household individual(s) are combined into one wage, the income of the household members shall be determined as follows: a. If the household's share can be identified, the district shall count that portion due to the household as earned income. b. If the household's share cannot be identified, the district must prorate the earned income among all those jointly receiving the wage and count that prorated portion to the household. NOTE: For determining deductions see SNAP SB Section 12. References: 387.16 - Special provisions for household circumstances 7 CFR 273.4(c)(3)(iv) - Citizenship and Alien Status GIS 05TA/DC002 Exclusion of Military Combat Pay 08 ADM-09 Farm Bill Reauthorization Provisions of Food Stamp Program for 2008 G. Income Exclusions Only the following items shall be excluded from household income: 1. Monies Withheld or Returned to Repay Prior Overpayments From The Same Income Source Monies withheld from an assistance payment, earned income, or other income source, or monies received from any income source, which are voluntarily or involuntarily returned, to repay a prior overpayment received from that income source shall not be counted as income to the household, provided that the overpayment was not otherwise excluded. Reduction of public assistance benefits: if the benefits of a household that is receiving public assistance are reduced under a Federal, State, or local means- tested public assistance program because of the failure of a SNAP household member to perform an action required under the assistance program or for fraud, the State agency shall not increase the household's SNAP allotment as a result of the decrease in income. NOTE: However, TA or UIB recoupments of overpayments resulting from an intentional program violation (IPV) are NOT excluded. A TA IPV is defined for this purpose as conviction by a court, or recipient admission of fraudulent receipt of TA benefits. NOTE: Money recouped from a TA or UIB grant to recover advances (e.g., to prevent utility shut- offs) shall not be excluded since the advance was excluded at time of occurrence. NOTE: Recoupments of SSI and SSD amounts would be counted if the recoupment is a result of an IPV imposed by SSA. 2. Child Support Payments a. Child support payments received by TA recipients which must be transferred to the Title IV-D agency to maintain TA eligibility. NOTE: The first $100 of child support payments or $200 for a household with more than one child made to IV-D and then returned to the recipient is countable as income for SNAP purposes. Only the IV-D child support pass-through which was received by the household within normal processing time frames is countable as income. b. Both legally obligated and informal child support payments (current and arrears) made by a SNAP household member to non-household members shall be treated as income exclusions. Local districts should enter total gross income received and amounts of child support paid by SNAP households into the ABEL input screens. ABEL will subtract the child support payments from total household gross monthly income before comparing income to the applicable gross and net income limits. Child support payments are excluded when screening for Expedited Processing. . c. In cases where legally obligated or informal child support is paid to a non- household member, the child support is excluded from the payer’s SNAP income. However, the income exclusion is not allowed when the recipient of the child support payment is included in the same SNAP household with the payer of the child support. Districts also are reminded that, in joint custody situations, only one of the parents or guardians can have the children included in their SNAP household for a given month. GIS 05 TA/DC006 (Rev. 7/01). 3. In-Kind Benefits Any non-monetary gain or benefit received by the household, regardless of source. Some examples of in-kind benefits are meals, clothing, housing, and produce from a garden. 4. Vendor Payments Money payments that are not paid (or payable) directly to the household but which are paid to a third party by someone outside the household for an expense incurred by the household. This vendor payment can be made by an individual or an organization outside of the household to the SNAP household's creditors or those providing a service. To be excluded, the vendor payment must not be money that is legally obligated to the household but diverted by the payer to a third party for a household expense. Some examples of excluded vendor payments are: a. Rent or mortgage payments made to a landlord or mortgagee by the Department of Housing and Urban Development (HUD), or by other housing authorities. When such payments are made directly to a landlord, they are also not allowed as a SNAP shelter cost. The household's out of pocket rent expense is allowable as a SNAP shelter cost. b. Payments made directly to the landlord by a relative or friend outside the household for the household's rent. c. Housing provided to an employee by an employer. d. TA payments, over and above the normal grant, made to a third party (even if the household is given the option to receive cash), such as emergency payments or "special grants" for moving. NOTE: TA payments for excess shelter costs which a local district adds on a recurring, non-expiring basis to the state-approved standard of need are not excludable, even if the payments are made to a third party. However, emergency shelter allowances for persons with AIDS, or HIV- related illnesses, are exempt as income. e. Payments specified by court order, or other legally binding agreement, to be made directly to a third party rather than to the household are excluded as income to the household which would otherwise have received payments. f. Payments made by an insurance company to a hospital for care of a household member. g. TA restaurant allowances which are paid by voucher or directly to the vendor by any other means NOTE: Restaurant allowances paid directly to recipients in a separate check are not excluded as SNAP income. h. The amount of a TA payment which is over and above the maximum TA shelter allowance for the family size paid directly to a third party for the cost of providing homeless transitional housing. i. The entire amount of the TA shelter payment paid to a domestic violence shelter for victims of domestic violence. The SNAP shelter expense of a TA household residing in a domestic violence shelter is only their out-of- pocket cost, if any, that they are required to pay from other income. j. Any Emergency TA vendor payment to a third party made on behalf of a migrant or seasonal farmworker household while the household is in the job stream. Examples are emergency vendor payments for housing or transportation. NOTE: Payments that are legally obligated and otherwise payable to the household but are diverted by the provider of the payment to a third party for a household expense. Some examples of payments which are counted as income, even though money is not received directly by the household, are: (1) Wages garnished by an employer and (2) Money deducted from a court-ordered support or alimony payment to a third party for a household expense. 5. Income From Private Non-Profit Charitable Organizations Need-based cash donations received from one or more private non-profit charitable organizations to the extent that such payments do not exceed a total of $300 in a federal fiscal year quarter. NOTE: For this purpose, the quarter year period is defined as a quarter of a federal fiscal year, which starts in October. 6. Irregular Income Any income in the certification period that is received too infrequently to be reasonably anticipated, but not in excess of $30 per quarter. 7. Educational Income Educational assistance includes but is not limited to grants, including work study grants; fellowships; loans and scholarships. All federal educational loans are excluded as income. Non-federal educational loans are excluded as income except educational loans on which repayment is deferred greater than 60 days after receipt of the loan. Only the amount that is designated for living expenses counts in calculating SNAP benefits (e.g, the amount that the loan exceeds the client’s tuition, fees, books, supplies, childcare and other earmarked educational expenses). Reimbursements for normal household living expenses such as rent or mortgage, personal clothing, or food eaten at home are a gain or benefit and therefore are not excluded. In order to be excluded, income assistance must be: a) Awarded to a household member enrolled at a : 1. Recognized institution of post-secondary education 2. School for the handicapped 3. Vocational education program 4. Program that provides for obtaining a secondary school diploma or equivalent b) Used for the following allowable expenses: 1. Tuition 2. Mandatory school fees 3. Books 4. Supplies 5. Transportation 6. Miscellaneous personal expenses, other than normal living expenses, of the student incidental to attending a school, institution or program, 7. Dependent care. Amounts excluded for dependent care shall not also be excluded as a dependent care reimbursement. Dependent care costs which exceed the amount excluded from income shall be deducted as a dependent care expense. 8. Origination fees and insurance premiums on educational loans NOTE: Educational income exclusions must be incurred or anticipated for the period the educational income is intended to cover regardless of when the educational income is actually received. If the student uses other income sources to pay for allowable educational expenses before the educational income is received, the exclusions to cover the expenses shall be allowed when the educational income is received. 8. Loans All loans, including loans from private individuals as well as commercial institutions, other than non-federal educational loans on which repayment is deferred. Only the amount that is designated for living expenses counts in calculating SNAP benefits (e.g, the amount that the loan exceeds the client’s tuition, fees, books, supplies, childcare, and other earmarked educational expenses). A loan on which repayment must begin within 60 days after receipt of the loan shall not be considered a deferred repayment loan. 9. Reimbursements Reimbursements for past or future expenses that do not exceed actual expenses and are not a gain or benefit to the household. a. To be excluded, the payments must be provided specifically for an identified expense, other than normal living expenses, and used for the purpose intended. NOTE: Reimbursements for normal household living expenses such as rent or mortgage, personal clothing, or food eaten at home are a gain or benefit and, therefore, are not excluded. b. Multiple Expenses - When a reimbursement, including a flat allowance, covers multiple expenses, it is not necessary to identify each expense separately, provided none of the reimbursement covers normal living expenses. The amount by which a reimbursement exceeds the actual expenses is counted as income. However, reimbursement must not be considered to exceed actual expenses unless the provider or the household states the amount is excessive. c. Examples - Reimbursements for the following type of expenses are excluded: (1) Job or training related expenses such as travel, per diems, uniforms, and transportation to and from the job or training site. (2) Travel expenses incurred by migrant workers. (3) Expenses of TA participants of work experience programs or community service programs if they are not included in the TA budget as an item of need. (4) Out-of-pocket expenses of volunteers incurred in the course of their work. This includes HIV Peer Education Stipends. (5) Medical or dependent care reimbursements. Child Care reimbursements are excluded as income whether paid as direct payment or vendor payment by the local district. For information on Child Day Care payments and the dependent care deduction see Section 11. NOTE: In mixed SNAP households where the TA members are issued a special TA allowance for day care and the day care is provided by a non-TA member of the SNAP household, the allowance is counted as earned income to the day care provider. The allowance is considered excludable income to the TA members by being a reimbursement. Any dependent care costs the TA members pay to the day care provider above the special allowance are not allowable as a dependent care deduction because the provider is a SNAP household member. (6) Title XX Services (387.11) (7) TA refrigerator rental allowance for homeless TA families in hotels/motels. (8) Payments made to operators of family type homes for adults to enable payment for certain special needs of residents of such facilities. (9) Payments under P.L. 93-288, Section 312(d), the Disaster Relief Act of 1974, as amended by P.L. 100-707, Section 105(i), the Disaster Relief and Emergency Assistance Amendments of 1988, 11/23/88. This exclusion applies to Federal Assistance provided to persons directly affected, such as Disaster Unemployment Assistance, and to comparable disaster assistance provided by States, local governments, and disaster assistance organizations. Also excluded are Federal Emergency Management Assistance (FEMA) subsidies to households to pay for temporary housing after a disaster. NOTE: Monies that exceed the cost of the housing that are not returned to FEMA would be income. However, payments made to homeless people to pay for rent, mortgage, food, and utility assistance when there is no major disaster or emergency is not excluded under this provision. (10) Grants of Assistance for Guide Dogs. However, if a SNAP client can verify that the cost of maintaining the guide dog exceeds the grant, the amount over and above the grant can be added to the client's medical deductions as explained in SNAPSB Section 12. 10. Third-Party Beneficiary Monies received and used for the care and maintenance of a third-party beneficiary who is not a household member. If the intended beneficiaries of a single payment are both household and non-household members, any identifiable portion of the payment intended and used for the care and maintenance of the non-household member shall be excluded. If the non-household member's portion cannot be easily identified, the payment shall be evenly prorated among intended beneficiaries; the non-household member's prorated share or the amount actually used for the non-household member's care and maintenance, whichever is less, shall be excluded. NOTE: The "visitor's allowance" paid to the parent whose SNAP household does not include the child is not counted as TA income to that parent's SNAP case. NOTE: When a TA essential person is not a member of an TA-SNAP household and is not a member of another SNAP household then his/her portion of the TA allowances other than TA shelter and fuel allowances must be excluded as income to the SNAP household of which he is not a member. These exclusions apply whether his portion of the grant is issued separately or in the TA grant. 11. Earned Income Of Students The earned income of students who are members of the household and are enrolled as elementary or high school students, including persons pursuing a high school equivalency diploma (GED) at least half-time that are less than 18 years old. This exclusion extends through the end of the month in which the student turns 18. The exclusion will continue during semester or vacation breaks provided the child's enrollment resumes following the break. If the child's earnings or amount of work performed cannot be separated from that of other household members, the total earnings shall be prorated equally among the working members and the student's pro rata share excluded. This exclusion also applies to migrant workers. 12. Non-Recurring Lump Sum Payments This includes but is not limited to the following: a. Income tax refunds, rebates or credits, b. Retroactive lump sum Social Security, SSI, TA, Railroad Retirement benefits, retroactive lump-sum insurance settlements or other payments, or c. Any additional child support pass-through payments which represent support collections for previous months are excluded as lump sum payments unless the arrears are being paid over multiple months. If the arrears are received on a recurring basis they are counted as unearned income and combined with the normal monthly child support amount. d. Refunds of security deposits on rental property or utilities. NOTE: These payments count as resources in the month received unless specifically excluded from consideration as a resource. 13. Federal And State Earned Income Tax Credits (EITC) Advance payments of Federal EITC are excluded in the month received. Federal and State EITC paid in the form of a lump sum at the end of the year also are excluded. 14. Individual Development Accounts (IDAs) Contributions made by a local district or a nonprofit organization to an individual development account to enable a SNAP household member to save for postsecondary education, first home purchase or business capitalization are excluded. Withdrawals from an IDA for purposes other than postsecondary education, home purchase or business capitalization are counted, less any penalties assessed, as unearned income in the month withdrawn. Any remaining balance in the account would be considered an available resource. 15. Housing And Urban Development (HUD) Community Development Block Grants are excluded. 16. German Reparation Payments (From The Federal Republic Of Germany) And Austrian General Social Insurance Payments are excluded. 17. Disaster Relief Employment Income received under the National Emergency Grant program is excluded. 18. Domestic Volunteer Services Act Of 1973 (P.L. 93-113), Title I Payments to volunteers (including payments from such Title I programs as VISTA, University Year for Action, and Urban Crime Prevention Program) are excluded for households that already were receiving SNAP benefits or temporary assistance before they joined the Title I program. Temporary interruptions in the SNAP participation will not alter the exclusion, but new applicants who are Title I volunteers before they apply for SNAP benefits and/or temporary assistance will have the Title I payments counted as earned income. 19. Domestic Volunteer Services Act Of 1973, Title II and Title III a. Payments to volunteers (RSVP, Foster Grandparents, Senior Companion and senior health aide programs) of the Domestic Volunteer Services Act of 1973 (P.L. 93-113), as amended, are excluded. b. Payments under the Service Corps of Retired Executives (SCORE) and the Active Corps of Executives (ACE) programs are excluded. 20. National Community Service Act Funds All allowances, earnings and payments to individuals participating under Title I of the National Community Service Act of 1990 (P.L. 101-610) are excluded as income for SNAP purposes. Title I of this Act pertains to the National and Community Service State Grant Program, which includes AmeriCorps USA and AmeriCorps NCCC. Projects under this program are subject to the same treatment as most benefits under the Job Training Partnership Act. The types of activities are broadly defined. Participants may perform any educational, human, environmental, or public safety service that will benefit the community. 21. Senior Community Service Employment Program (SCSEP) Any funds received by individuals 55 and older under the SCSEP, (Title V of P.L. 100-175, the Older Americans Act of 1987) are excluded. SCEPs in NYS include but are not limited to “Experience Works” funded by the U.S. Department of Labor, “Associates for Training and Development” as well as other programs administered by the following entities: NY State Office for Aging, the National Council on Aging, American Association of Retired Persons, the National Urban League, Green Thumb, the National Council of Senior Citizens, Senior Aids Program, U.S. Forest Service, National Association for Spanish Speaking Elderly and National Council on Black Aging. However, this list of agencies may not be all inclusive: if there is a question as to whether an income is Title V SCSEP income, the local district should contact its local area office on aging. 22. Energy Assistance Payments or allowances made under any Federal, State or local laws for the purpose of energy assistance. These payments must be clearly identified as energy assistance by the legislative body authorizing the program or providing the funds. Among the Federal payments that would be excluded are: a. Energy assistance payments provided through the Department of Health and Human Services' Low Income Energy Assistance Program and the Crisis Intervention Program, b. Vendor payments or Emergency Aid to Families (EAF) or Emergency Home Relief (EHR) made by local districts to assist TA households that exceed the normal TA fuel allowance (SA-6a and SA-6b), and c. EAF for fuel paid to Non-TA and SSI households. 23. Child Nutrition Benefits Payments received under P.L. 89- 642, Section 11(b) of the Child Nutrition Act of 1966, this includes the Women, Infants and Children (WIC) program and school meals. Also excluded are coupons issued under WIC Demonstration projects (P.L. 100-435, section 401), which may be exchanged for food at farmers' markets. 24. Fee For Representative Payee A qualified organization may collect a fee for acting as the representative payee for an individual receiving benefits in the SSI and/or Social Security Disability programs. The organization may take its fee out of funds it handles as representative payee. The monthly fee collected by the organization’s representative payee is legally obligated to the payee rather than to the household by virtue of the statute, and therefore is not countable 25. Plan to Achieve Self-Support (PASS) Income of SSI recipients necessary for the fulfillment of a PASS under Title XVI of the Social Security Act. The income exclusion for PASS accounts is effective December 13, 1991, unless the local district had information that a household member had a PASS account (in such cases the effective date is October 1, 1990) , or there was a fair hearing on the subject of denied PASS income exclusion (in such cases the effective date would be the date of the fair hearing). 26. Supplemental Needs Trusts (SNTs) Interest accruing to the trust would be excluded as income for the SNAP. Any cash disbursements, however, must be evaluated under normal SNAP budgeting rules. Disbursements from a SNT may be excludable from household income if they are reimbursements for past or future expenses that do not exceed actual expenses and are not a gain or benefit to the household. To be excluded, reimbursements must be for an identified expense other than normal living expenses. Disbursements made directly to a SNAP household for normal household living expenses, such as rent or mortgage, personal clothing, or food eaten at home are a gain or benefit and therefore are counted as income. A SNT disbursement that is not payable to the household but is instead directed to a third party would be excluded from countable income as a vendor payment. To the extent that the vendor payment meets expenses that would otherwise be allowed as deductions such as shelter, medical costs or childcare, however, the expense would not be allowed as a deduction. Income that is legally obligated to a household and countable as SNAP income but is diverted by the household into a SNT account is not excluded from SNAP income. Income from a pension or other investment that is being diverted into the SNT should be an income exclusion until it is disbursed from the SNT. As long as the income is not going to the client and is going directly to the trust, it should not count as income until it is taken out from the SNT. 27. Reverse Annuity Mortgage (RAM) Recurring or lump sum payments received on a reverse annuity mortgage which can be determined to be a loan are excluded as income. If repayment on the reverse annuity mortgage is made, either by the client repaying the loan directly or by the property reverting to the bank, it meets the acceptable definition of a loan. Documentation that the income from the reverse mortgage is a loan, such as a copy of the loan document signed by both parties, should be retained in the case record. Accumulated proceeds from a RAM loan, however, must be counted as a resource for the SNAP. 28. Income Of Non-Household Members The income of non-household members, other than disqualified individuals. 29. Costs Of Producing Self-Employment Income Detailed in Section 13 30. Workforce Investment Opportunity Act (WIOA) formerly known as WIA a. Earnings for work experience, compensation in lieu of wages, payments for supportive services, allowances for training-related expenses and other payments other than TA grants received by participants in WIOA programs as a result of such participation. NOTE: Earnings from OJT programs received by individuals participating in programs under Section 204(5), Title II of WIA are budgeted for determination of SNAP eligibility and benefit amounts as earned income, with the exception in paragraph (b) below. b. The earnings of household members under 19 years of age participating in an on-the-job training program under WIA, including OJT programs under Section 204(5), Title II of WIA, providing the member is under the parental control of another adult household member. NOTE: Perkins Loans are a source of Title IV educational income and are not considered WIA earnings. 31. Housing Restoration Payments Any governmental payments which are designated for the restoration of a home damaged in a disaster if the household is subject to a legal sanction if the funds are not used as intended. For example, payments made by the Department of Housing and Urban Development through the individual and family grant program or disaster loans or grants made by the Small Business Administration are excluded. Federal Emergency Management Assistance (FEMA) subsidies to households to pay for temporary housing after a disaster. However, monies that exceed the cost of housing that are not returned to FEMA would be considered income. Payments made to homeless people to pay for rent, mortgage, food, and utility assistance when there is no major disaster or emergency are not excluded under this provision. 32. Escrow Accounts Set up under the Family Self-sufficiency Program which is administered by HUD for residents of Section 8 or public housing. 33. Affordable Housing Act Service provided to a public housing resident under P.L. 101-625 section 22(i) of the Cranston-Gonzales National Affordable Housing Act. This exclusion applies to services such as childcare, employment training and counseling, literacy training, computer skills training, assistance in the attainment of certificates of high school equivalency and other services. It does not apply to wages or stipends. 34. Dividends from insurance policies 35. Interest from bona fide funeral agreements or funds 36. GI Bill Withholding The mandatory deduction from the paycheck of all military service personnel used to fund the GI Bill. 37. Excluded Specifically By Law Any income specifically excluded from determining SNAP eligibility by the following laws: a. Individuals Of Japanese Ancestry - Payments to individuals of Japanese ancestry and permanent resident Japanese aliens or their survivors in restitution for wartime relocation and internment (P.L. 100- 383, Section 105). b. Aleuts - Payments to natives of the Aleutian or Pribilof Islands in restitution for wartime relocation and internment (P.L. 100-383, Section 206). c. Compensation Paid By an Eligible Crime Victim Compensation Program (P.L. 103-322). d. Agent Orange Payments: (1) The Agent Orange Settlement Fund; and (2) Any other fund established pursuant to the settlement In Agent Orange Product Liability litigation. NOTE: Benefits must be restored to any household which reports and documents that it was denied or under issued SNAP benefits due to the receipt of Agent Orange payments back to January 1, 1989. NOTE: P.L. 102-4, Agent Orange Act of 1991, 2/6/91, authorized veterans' benefits to some veterans with service-connected disabilities resulting from exposure to agent orange. These VA payments are not excluded by law. e. Spina Bifida Payments paid to children of Vietnam veterans under P.L. 104- 204 are excluded. f. Payments To Indians - Certain payments to Indians are excluded under federal law. Usually a law will specify payments to members of a tribe or band, and the law will apply to the Indians enrolled in the tribe or band wherever they live. The Indians should have documentation showing where the payments originate.) (1) Alaska Native Claim Settlement payments received under P.L. 92-203, Section 21(a). This includes all compensation such as cash, stock, partnership interest, land, interest in land, and other benefits received under this Act. (2) Sub marginal U.S. Land - Income derived from certain sub marginal US land held in trust for certain Indian tribes (P.L. 94-114, Section 6). (3) Payments by The Indian Claims Commission to the Confederated Tribes and Bands of the Yakima Indian Nation or the Apache Tribe of the Mescalero Reservation (P.L. 95-443). (4) The First $2,000 Of Funds Distributed by the Indian Claims Commissioner pursuant to P.L. 93-134 as amended by PL.L. 97-458. P.L. 98-64 extended the exclusion to cover per capita payments from funds which are held in trust by the Secretary of Interior (trust fund distributions). (5) Maine Indians - Payments to the Passamaquoddy Tribe, the Penobscot Nation and the Harlton Band of Maliseet or any of their members received pursuant to the Maine Indian Claims Settlement Act of 1980 (P.L. 96-420, Section 5). (6) Navajo And Hopi Tribes - Payments of relocation assistance to members of the Navajo and Hopi tribes under P.L. 93-531, section 22. (7) P.L. 94-540 - Payments from the disposition to funds to the Grand River Band of Ottawa Indians. (8) P.L. 97-403 - Payments to the Turtle Mountain Band of Chippewas, Arizona. (9) P.L. 97- 408 - Payments to the Blackfeet Gros Ventre, and Assiniboine tribes (Montana) and the Papago (Arizona). (10) P.L. 98-124, Section 5 - Per capita and interest payments made to the Assiniboine Tribe of the Fort Belknap Indian Community, Montana and the Assiniboine Tribe of the Fort Peck Indian Reservation (Montana). (11) P.L. 98-123, Section 3, 10/13/83 - Per capita and interest payments made to the Red Lake Band of Chippewas. (12) P.L. 99-346, Section 6(b)(2) - Payments to the Saginaw Chippewa Indian Tribe of Michigan. (13) P.L. 99-377, Section 4(b), 8/8/86 - Per capita payments to the Chippewas of Mississippi. (14) P.L. 101-426, Section 6(h)(2), the Radiation Exposure Compensation Act, dated October 15, 1990. (15) The first $2000 of payments made under P.L. 98-500, Section 8, 10/17/84, Old Age Assistance Claims Settlement Act, to heirs of deceased Indians. (16) P.L. 99-146, Section 6(b), 11/11/85 - Funds distributed per capita or held in trust for members of the Chippewas of Lake Superior. (17) P.L. 99-264, White Earth Reservation Land Settlement Act of 1985, 3/24/86, Section 16. This Act involves members of the White Earth Band of Chippewa Indians in Minnesota. (18) Seneca Nation Settlement Act - Under Public Law 101-503 and the memorandum of understanding between the Seneca Nation and the State, Settlement Act monies are exempt from consideration in determining eligibility or benefits for any State or federally funded social services program. These monies must not be counted as income or resources now or at any later point in time. g. Online Crowdfunding Accounts Crowdfunding accounts are not considered income. Reference GIS 16 TA/DC011 to determine how crowdfunding accounts should be factored into SNAP eligibility decisions as a resource. References: 387.11 – Income Exclusions 7 CFR 273.9 – Income and Deductions 94 ADM-11 Domestic Violence: Eligibility and Payment for Residential Services for Victims 94 ADM-20 Preventing Homelessness and Providing Assistance to Homeless Persons 02 ADM-7 Food Stamp Program Reauthorization Changes 02 ADM-1 Food Stamp Treatment of Individual Development Accounts 97 ADM-4 Clarifications of Various Food Stamp Welfare Reform Provisions 95 ADM-15 Food Stamp Program Implications of the Mickey Leland Childhood Hunger Relief Act (P.L. 103-66) 92 ADM-9 Food Stamps: Income Exclusion for Homeless Households in Transitional Housing 92 ADM-6 Treatment of Earned Income Tax Credit (EITC) 91 ADM-25 Section 8: Amendment to Department Regulation 352.3(d) and the Effect on Public Assistance Households in Section 8 Rent Subsidy Programs 91 ADM-6 PA and SNAP Disregards: Treatment of Agent Orange Payments 90 ADM-31 Employment- and JOBS- Related Child Care, Transitional Child Care and Local Child Care Market Rates For All Forms of Child Care 90 ADM-12 Food Stamps: Treatment of Income from On the Job Training Under the Job Training Partnership Act (JTPA) 90 ADM-8 Emergency Shelter Allowances for Persons with AIDS or HIV related Illness Faced with Homelessness 91 ADM-8 Federal and State Changes Concerning Medical Assistance Eligibility Policy 05 ADM-14 Food Stamp Budgeting: VISTA Payments and Medical Mileage Expenses 08 ADM-09 Farm Bill Reauthorization Provisions of Food Stamp Program for 2008 01 INF-8 Temporary Assistance (TA) and Food Stamps (SNAP) Policy: The Treatment of Supplemental Needs Trusts (SNTs) and Reverse Annuity Mortgage (RAM) Loans 95 INF-35 Food Stamps: SSI or SSDI When Disability is Based on Drug Addiction or Alcoholism 95 INF-30 Clarification of the Treatment of AmeriCorps Awards 94 INF-45 PA Budgeting and Case Category for Joint Custody Cases93 INF-8 Food Stamp Income Exclusions: National Community Service Act Funds 92 INF-45 PA, MA and SNAP Treatment of Escrow Accounts Under the Family Self-Sufficiency (SNAPS) Program Administered by the Department of Housing and Urban Development (HUD) 92 INF-16 Food Stamp Treatment of Payments to Qualified Organizations Serving as Representative Payees in the SSI Program 90 INF-33 Treatment of Income from Certain Senior Citizen Programs for Public Assistance, Medical Assistance and Food Stamps 94 INF-41 HIV Peer Educator Stipends 04 INF-05 Disregard Certain Veterans Administration (VA) Payments Made to Biological Children of Women Vietnam Veterans and Extend to Safety Net Assistance Families the Disregard of VA Payments Made to Vietnam Veterans' Children with Spina Bifida 12 INF-14 Supplemental Nutrition Assistance Program Policy – Student Eligibility (Replaces 11-INF-06) 96 LCM-83 Food Stamp Impact of New Federal Welfare Law 92 LCM-120 Seneca Nation Resettlement Act GIS 01 TA/DC040 Exemption of Disaster Relief Payments GIS Message (05 TA/DC006) Food Stamp Exclusion of Child Support Payments From Income GIS Message (05 TA/DC004) Exclusion of Disaster Relief Earnings GIS 16 TA/DC011 – SNAP Treatment of Funds in On-Line “Crowdfunding” Accounts H. Self-Employment Other Than Farming Self-employment income provisions are for all households receiving self-employment income, including those households that own and operate a commercial boarding house. For households that receive income from boarders but do not own and operate a commercial boarding house, see J. Boarders, in this section. 1. Definition Self-employment income is the total gross income from a self-employment enterprise, including the total gain from the sale of any capital goods or equipment related to the business. Payments from a roomer or boarder are self- employment income and are counted as earned income. Payments from rental income are self-employment income and are counted as earned income if the property is managed by a household member at least 20 hours per week. If the rental property is managed less than 20 hours per week, the rental income minus the cost of doing business derived from the rental property is counted as unearned income Determining Monthly Self-Employment Income a. Calculating Income By Averaging - Add all gross self-employment income (including capital gains), exclude the cost of producing the self-employment income, and divide the self- employment income by the number of months over which the income will be averaged. b. Calculating Anticipated Income - When self-employment household income is anticipated, rather than averaged, the local district must: (1) Add any anticipated capital gains for the next 12 months, starting from the application date. (2) Divide the resultant amount by 12. This amount shall be used in successive certification periods during the next 12 months unless the anticipated amount of capital gains changes. (3) Add the anticipated monthly amount of capital gains to the anticipated monthly self- employment income. (4) Subtract the cost of producing the self-employment income. The cost of producing the self-employment income shall be calculated by anticipating the monthly allowable costs of producing the self-employment income. NOTE: A household may have zero net self-employment income indefinitely, if gross proceeds are sufficient to sustain the household, even if the business (on paper) shows a loss. However, if visible gross income is insufficient to cover household expenses but the household expenses are paid, then the household must be requested to explain these questionable circumstances. 2. Determining Monthly Net Income To determine the monthly net income of the household: a. Add the monthly net self-employment income to any other earned income received by the household. b. Subtract the 20% earned income deduction. c. Then add to this figure all the monthly unearned income. d. The standard deduction, dependent care, and shelter costs will be computed as for any other household and subtracted to determine the monthly net income of the household. 3. Child and Adult Care Food Program The Child Care Food Program (CACFP) payments to meal providers is designed to provide nutritious meals for children up to age 12 and handicapped children up to age 15 who participate in a non-profit, licensed or approved day care program. Self-employed households in receipt of CACFP income may apply for SNAP. These households would most likely be operating family day care or after school programs in their own homes/apartments. In determining the amount of CACFP income used to calculate SNAP benefits the following steps are taken: a. Establish the gross CACFP payment(s) to the provider. b. Subtract from the established CACFP gross payment the total allowable self- employment costs to establish the net self-employment income. The cost of producing self-employment income from childcare is the actual costs, the amount of the CACFP payments, or $5.00 per day per child in care (not including the provider's own children), whichever is greater. c. Apply 20% earned income deduction to the net self-employment income. CACFP payments given to the provider for meals served to the provider's own children are treated the same as CACFP payments given to the provider for meals served to other children. 4. Determining Benefit Level To determine the benefit level, the local district may elect to offer the household the option of: a. Using the same net income that was used to determine eligibility, or b. Prorating the household's total net income in a manner that more closely approximates the time in which it was received. If income is prorated, the net income assigned in any month cannot exceed the maximum monthly income eligibility standards for the household size. 5. Annualized Self-Employment Income Self-employment income which represents a household's annual support shall be spread over a 12-month period, even if the income is received in only a short period of time. Self-employment income received by a household shall be averaged over a 12- month period if the income is intended to support the household on an annual basis. This self-employment income shall be annualized even if the household received income from other sources in addition to self-employment. a. Annual Income Paid On A Monthly Basis - Self-employment income, which is received on a monthly basis, but which represents a household's annual support will normally be averaged over a 12-month period. If, however, the averaged amount does not accurately reflect the household's actual monthly circumstances because the household has experienced a substantial business increase or decrease in business, self-employment income will be calculated based on anticipated earnings. Self-employment income must not be calculated on the basis of prior income (e.g., income tax returns) when the household has experienced an increase or decrease in business as determined by the local district. NOTE: If a self-employed household's income tax returns for last year reveal a substantial, unreported increase in average monthly income and the increase is not expected to continue, it cannot be used in budgeting for the following year. b. Self-Employment Income As Part Of Annual Support - When the self- employment income is only part of a household's annual income, it must be averaged over the time period the income is intended to cover. EXAMPLE: Self-employed vendors may work only in the summer and may supplement their income from other sources during the balance of the year. They must have their self-employment income averaged over the summer months rather than the 12-month period. It is then added to any other income during that period. c. Self-Employment Income From Enterprises Existing For Less Than One Year - For business enterprises in operation less than a year, the self-employment income is averaged over the time period the business has been in operation. The monthly amount is projected for the coming year. If the business has been in operation for such a short time that there is no data to make a reasonable projection, the household must be certified for less than a year until the business has been operating long enough to make the longer projection. 6. Re-Annualizing Self-Employment Income A SNAP household with self-employment income which has been annualized over a 12-month period may unexpectedly experience a considerable change in the amount of self-employed income they were anticipated to receive for the coming year. Such households would be entitled to have their self-employment income re-annualized with taking into account this unexpected change for the remainder of the year. NOTE: Before making the budget change, the local district should determine that the annual income has actually changed and that it is not just a monthly fluctuation in self-employment income. 7. Capital Gains Are Self-Employment Income The proceeds from the sale of capital goods or equipment must be calculated in the same manner as a capital gain for Federal Income Tax purposes. For Federal income tax purposes, capital gains are generally computed by comparing the sales price to the "cost or other basis." If the sales price is greater, there is a gain. If the costs are greater, there is a loss. The "cost or other basis" in general is the cost of the property, purchase commissions, improvements and sales expenses such as broker's fees and commissions minus depreciation, amortization and depletion. The full amount of the capital gain, if any, is counted as income for SNAP purposes. 8. The Cost Of Producing Self-Employment Income Is An Income Adjustment a. Allowable Costs - The allowable costs of producing self-employment income include, but are not limited to, the identifiable costs of labor, stock, raw materials, seed and fertilizer, payments on the principal of the purchase price of income-producing real estate and capital assets, equipment, machinery, and other durable goods, interest paid to purchase income- producing property, insurance premiums, and taxes paid on income-producing property. b. For SNAP households with self-employment income derived from providing in-home childcare, a standard deduction of $5 per day per child in care (not including the provider's own children), or the amount of the CACFP can be deducted from the childcare earnings without documentation of specific cost of doing business expenses. The following conditions apply: (1) Eligible households must be provided the standard, or actual costs if higher. (2) Eligibility staff must inform households of the option to verify actual costs if they exceed the $5 standard expense. c. SNAP households who residence in an income producing multi-unit property - (such income producing property includes owner occupied rental property, income from roomers and other self-employment enterprises located in the SNAP household’s residence.) A portion of this income can be excluded if it is related to the cost of producing the income. Examples include mortgage interest, property taxes, heating, utilities and insurance. The portion of the building costs which are for the SNAP household’s own living unit may not be disregarded from the gross business income but are allowed as shelter costs. Determination of how to treat business expenses is as follows: (1) In most cases, past income tax records will be sufficient to indicate what portion of the expenses are considered business income and therefore disregarded from the gross income for SNAP purposes. (2) In the absence of past income tax records, the portion of the income to be excluded will have to be determined. Any expense which is exclusively for the income producing component of the property would be fully excluded. EXAMPLE: Heat or utility expenses which are metered separately. (3) If the household can document through the use of existing business records the break-out of any shared expense this documented amount is used. In the absence of such records, the worker must determine an amount by prorating the expense among the units. EXAMPLE: If a building contained three units, two rented and one occupied by the SNAP household, two-thirds of the shared expense would be excluded. The one-third remaining expense is a shelter cost to the SNAP household. d. SNAP household rents room(s) in a single-unit dwelling - When a SNAP household rents one or more rooms in his house any reasonable approach to determine what portion of the expenses incurred by the SNAP household can be attributed to producing the self-employment income may be utilized. One approach would be to determine a pro rata share of expenses such as mortgage interest, property taxes, heating, utility and insurance based on the total number of rooms in the home (excluding bathrooms) divided by the number of rooms occupied by the roomer. For example, if a house had 3 bedrooms, a living room, dining room, kitchen and two baths, the owner rented out one bedroom, the pro rata share of the expenses related to the cost of producing the income would be 1/6. 9. Determining Non-Allowable Self-Employment Income Adjustments Local districts shall not allow the following items as the cost of business when determining a self-employed household's net income: a. Net losses from previous periods b. Federal, State and local income taxes, money set aside for retirement purposes, and other work-related personal expenses (such as transportation to and from work), as these expenses are accounted for by the 20% earned income deduction specified in this section c. Depreciation d. Garnishments have no effect on the treatment of self-employment income, i.e., the total gross amount is counted as the income computation. The amount garnished is not an income exclusion. References: 387.16 – Special Provisions for Household Circumstances 7 CFR 273.11 – Actions on Households with Special Circumstances 94 INF-29 01 INF-21 Food Stamp Questions and Answers 90 INF-4 Food Stamp Program Treatment of Child Care Food Program (CACFP) Payments 91 INF-29 Family Day Care: Incentives for Public Assistance Recipients to Become Providers 94 GIS ES/DC018 I. Self-Employment Farming Self-employed farmers are subject to the same eligibility and processing requirements as all other households unless otherwise specified in this section. 1. Definitions a. Self-Employed Farmer - An individual who receives or anticipates receiving annual gross proceeds of $1,000 or more from the farming enterprise. b. Sole Proprietorship - An unincorporated business that has no existence apart from the owner. The business liabilities are personal liabilities of the single owner. c. Partnership - Two or more individuals jointly owning a business. d. Independent Contractor - An individual who pays the costs of doing business and receives a portion of the net income in exchange for labor. 2. Determining Self-Employment To be a self-employed farmer the person must have direct involvement in farming operations. Farming operations may involve livestock, dairy, fruits, vegetables, ranches, nurseries, the production and sale of maple products, Christmas trees and beeswax. A person who rents his land to another individual to raise a crop is not a self-employed farmer if he/she is not directly involved in the growing/harvesting of the crop. Each situation must be reviewed on a case-by- case basis to determine if a person is a self-employed farmer or a farm employee. a. Farm self-employment income generally consists of earnings derived by an individual as the sole proprietor of his farm. b. There may also be some self-employment income situations which involve a partnership. In such cases there should be an oral or written agreement. Generally, a partner's share of income, gain, loss, deductions or credits is determined by the partnership agreement. In any matter not addressed by a written agreement the provision of local law are considered to be part of the agreement. c. Other self-employment situations for SNAP purposes include independent contractors who pay the farm expenses and persons who do not have a direct employer/employee relationship. In determining if the person is an independent contractor, determine if a household operates a separate (perhaps more specialized) business than the owner of the land or proprietor of the main business. In determining if there is an employer and employee relationship, consider such things as whether the person has an established work schedule and specified wages, whether the employer withholds social security and income taxes from earnings, etc. A sharecropper who pays the costs of doing business and receives a portion of the net income in exchange for his labor is a self-employed farmer. A sharecropper who does not pay the costs of doing business is not a self-employed farmer. d. An owner or employee of a closely held (just a few shareholders) or other corporation is not a self-employed person. If the person receives a salary from the corporation, he is considered an employee of the corporation. Shareholders who only receive dividends are entitled to neither the costs of producing self-employment income nor the earned income deduction. The dividends are counted as income. Corporations are separate legal entities, and the corporation is responsible for its debts and obligations. 3. Determining Income In addition to the income provisions outlined in this section the following also apply to self- employed farmers: a. Countable Income (1) Federal drought assistance payments are counted as earned self- employment income regardless of whether they are made in one payment or several. Drought payments must be prorated over the same period as other self-employment income. In essence, the payments are substitutes for monies that were lost as a result of the drought and that had already been calculated in the determination of SNAP benefits. (2) Commodity Credit Corporation (CCC) Payments: Under the Payment-In- Kind (PIK) program, farmers receive commodities from the U.S. Department of Agriculture, Commodity Credit Corporation. No income is received by the household until the gain is realized from a sale. If the commodities are expected to be sold during the year, the anticipated income must be included for SNAP purposes. The CCC may also pay farmers in the form of commodity certificates for land diversion or acreage reduction. The certificates may later be surrendered to the CCC for cash or for commodities, or the farmer may sell the certificate to someone else, usually for a profit. The certificates are valued based on the price of the commodity at the time of the agreement with the CCC and the number of bushels of the commodity the farmer will lose through land diversion or acreage reduction. When the certificates are exercised, the farmer receives cash or commodities based on the price of the commodity at the time. The cash received under this program is counted as income in the year it is expected to be received. It is annualized like other self- employment farm income. The value of any commodity which the household intends to use for feed or seed is excluded from income. If the farmer intends to retain the certificate or the commodity longer than 12 months, the value thereof is counted as a resource. In some cases farmers will sell commodities they own to the CCC and receive them back from CCC as PIK commodities. Farmers are paid by CCC for the commodities with the payment being used to repay price support loans previously extended to the farmer by CCC. These sales and loan payments should be treated as completely separate transactions from the receipt of CCC certificates or PIK commodities and should be handled in the same manner as any other sale of commodities and repayment of a price support loan. (3) Payments received in cash from agricultural stabilization and conservation programs are counted as income. (4) Patronage dividends are reported on tax forms. They are paid by cooperatives in cash or shares of stock. These dividends are similar to rebates paid based on the amount of goods brought or services used for the self-employment enterprise. Cash dividends are counted as income. NOTE: Dividends in the form of stock are counted as a resource. (5) Dairy Termination Program b. Annualizing Self-Employment Farming Income c. Costs Of Doing Business - Self-employed farmers are given special income treatment because they incur costs in producing their income which must be deducted in order to equate their income with income from sources in which there are no production costs. (1) Allowable Costs - In addition to the allowable costs of producing self- employment income found in this section, the following costs are excluded when determining a self-employed household's net income: (a) Privilege taxes such as licensing fees and gross receipts and general excise taxes that must be paid in order to earn self-employment income; (b) Business transportation costs such as costs of carrying grain to an elevator, trips to obtain supplies, etc. (c) Rental payments on income-producing equipment. If a farmer is renting equipment with an option to buy, the rent payments are considered allowable costs of producing self-employment income until the purchase is made; (d) Costs of repairs and maintenance of equipment; and (e) Storage and warehousing charges. (f) Shelter Portion of Farm - Where a farm mortgage does not separately identify the business and home portions of the property, the local district may use reasonable means of identifying the separate costs through proration. Proration may be based on information from sources such as the mortgage lender, real estate tax records, Farmer's Home Administration documents, insurance premium notices, or other available information. The prorated portion of the mortgage principal, taxes and interest which are attributed to the home are allowed as shelter costs. The portion of the interest and taxes (but not mortgage principal payments) attributed to the business portion of the property are allowed as costs of producing income. (g) Utility expenses - utility expenses which are not separately metered for the home and business portions of the farm may be prorated, based on income tax records or other available information. The prorated actual cost which is attributed to the business is allowed as an allowable cost of producing self-employment income. The remaining actual cost or the utility standard, whichever is greater, is allowed as a shelter expense. NOTE: Costs are allowed at the time of billing. When the income is annualized, only expenses billed or otherwise due in the current 12- month period are allowed. Costs that were billed or otherwise became due in a prior year which are not expected to recur in the current year may not be brought forward to the current year regardless of when they are paid. (2) Non-Allowable Costs - See this section d. Other Income Exclusions (1) A Federal gasoline tax credit is excluded from income. (It is a credit against tax liability.) (2) A State gasoline tax refund is excluded from income on the basis that it is a nonrecurring lump-sum payment. (3) Recaptured Depreciation and Recaptured Investment Credit: the IRS allows self-employed persons to deduct depreciation on property, such as a tractor, as a cost of doing business. When the property is sold before the end of its useful life, the seller must declare a portion of the depreciation as income for IRS purposes. This is commonly referred to as recaptured depreciation. The IRS allows a percentage of certain investments to be deducted as an expense. If the asset is disposed of or ceases to be eligible before the end of the recapture period for recovery property or before the end of the estimated life used to figure the credit, a percentage of the credit may have to be recaptured for IRS purposes. This is commonly referred to as recaptured investment credit. Recaptured depreciation and recaptured investment credit are considered in the capital gains computations in the same manner as they are for Federal Income Tax purposes. (4) A crop insurance payment is excluded from income if it is a nonrecurring lump-sum payment. NOTE: If the insurance company pays the household in installments, the money is counted as income. e. Operating At A Loss - See this section f. Operating At A Profit - See this section 4. Sudden Changes In Income - See this section 5. Resources In addition to the regular resource provisions outlined in SNAPSB Section 17, the following provisions also apply to self-employed farmers: a. Livestock is excluded as a resource if it is used in the farm operation, kept as a household pet, or used for food. b. If a farmer has incorporated his farm and they are the sole worker and all of the corporation's assets are related to the farming operation, the farmer's stock in the corporation is essential to their employment and excluded from consideration as a resource. c. Sometimes a farmer may obtain a loan, but funds can only be released by signature of both the lender and the farmer. In such cases where the farmer has a "line-of-credit," only the portion that is actually borrowed and held in an account is counted as a resource. d. Some farm households receive PIK payments. Normally these are annualized as income. However, if the farmer indicates that he intends to retain PIK payments for longer than a year, the payments should not be annualized as income but counted as a resource to the extent that they will be kept longer than a year. e. Sealed grain is counted as a resource only if it has been in storage for more than 12 months. f. Non-contiguous property which was essential to farming and licensed vehicles which were used primarily for farming shall continue to be excluded as resources for one year following the termination of farm self-employment. After one year, the farmer's non-contiguous property and licensed vehicles shall remain excluded if a good effort is being made to sell such property or equipment at a reasonable price. The local district must determine when a farmer ceases to be self-employed on a case-by-case basis. NOTE: Farmland which is contiguous with the property on which a household's home is located is excluded as a resource indefinitely. NOTE: If a farmer declares bankruptcy, it must be determined whether the resources can be excluded under another provision such as being essential to self-employment, if the person is still self-employed. (See paragraph 6 below.) g. As stated in Section 17, resources that have been counted and prorated as income are excluded. Therefore, gross self-employment income that has been used in the income determination is excluded in the resource determination during the period of time that the net income is counted as income. A farmer may include the farm income in a bank account with other money and still retain the exclusion. EXAMPLE: A household earned $10,000 gross self-employment income last year and expects to earn the same amount this year. Six thousand dollars were excluded from income to cover the costs of doing business. Four thousand dollars were annualized and prorated as income for calendar year 1989. The household has $11,000 in a bank account. Only $1,000 is counted as a resource during 1989 unless there are other changes. $10,000 gross farm income 1988 $6,000 allowable costs $4,000 prorated for 1989 No changes were anticipated. $11,000 in bank account -$10,000 gross farm income $1,000 counts as a resource 6. Bankruptcy There are different types of bankruptcies. Some allow people to continue to do the same kind of business and others do not. a. If the person continues to earn self-employment income, the gross amount minus allowable expenses is counted. b. Sometimes the total amount of income goes to a trustee, and from this amount he pays the bills and gives the farmer a living allowance. This living allowance is not counted as income because it would result in the income being counted twice. c. In other situations, all of the money goes to the farmer, but they must pay a set amount to a court-appointed person for back debts. This amount is not allowed as an exclusion. An exclusion is only allowed for certain costs in the year in which they are billed or otherwise become due. The household is not entitled to a double exclusion. d. If a farmer sells equipment and uses the proceeds to pay off a loan, the money is income to the farmer. If a farmer sells equipment and the proceeds are diverted to a bank to repay a loan, the money is counted as income to the farmer. If a farmer voluntarily turns over collateral to a bank, and the bank sells the collateral to pay off a loan, the proceeds of the sale are not counted as income to the farmer. Once the collateral is turned over to the bank, it becomes the legal property of the bank. e. If a farmer holds the title to property and sells the property, any proceeds from the sale are counted as income to them. If the farmer gives the title to the bank or if the property is repossessed prior to sale and the bank sells the property, the proceeds are not counted as income to the household. f. If a lender is unable to collect on a farm loan, the lender may choose to forgive all or part of the outstanding balance. The forgiven portion is not counted as income to the household. 7. Verification (Also see Section 5) a. Tax Forms - The farmer's most recent income tax forms are typically sufficient sources of verification for self-employment income and expenses. Several IRS forms which the local district should become familiar with are: (1) Form 1040, U.S. Individual Income Tax Return (Sole Proprietorship); Schedule D, Capital Gains and Losses and Reconciliation of Forms 1099- B Schedule E, Supplemental Income Schedule F, Farm Income and Expenses (Schedule C is for nonfarm sole proprietorship) (2) Form 1065, U.S. Partnership Return of Income; Schedule K-1, Partners' Shares of Income, Credits, Deductions, etc. (3) Form 1120, U.S. Corporation Income Tax Return; Form 1120A, U.S. Corporation Short Form Income Tax Return; Form 1120S, U.S. Income Tax Return for an S Corporation (Small Business); Schedule K, Shareholders' Share of Income, Credits, Deductions, etc. (Summarizes the corporation's income deductions, credits, etc., reportable by the shareholders); Schedule K-1, Shareholder's Share of Income, Credits, Deductions, etc. (Shows each shareholder's separate share). (4) Form 4506, Request for Copy of Tax Form - A person may obtain a copy of his return from IRS by submitting IRS Form 4506, Request for Copy of Tax Form, but there is a charge for this. Persons are not required to file a federal tax form if they have income under certain amounts depending on their marital status. If the tax form is questionable or not available, the local district must ask to see other documents that support the income and expenses which the household has reported. (5) Form 4797, Gains and Losses from Sales or Exchanges of Assets Used in a Trade or Business and Involuntary Conversions (6) Form 4835, Farm Rental Income and Expenses NOTE: The IRS net income from farm self-employment cannot be used, because IRS computes income differently and allows different expenses such as depreciation on a yearly basis. Only certain information from the tax forms and schedules may be used for verification purposes. b. Other sources of verification may include, but are not limited to, ledgers, charge account statements, sales slips, cancelled checks, invoices, purchase orders and cash receipts. In documenting this verification, the local district should record the date, identify the other party or company, describe the expense or income, and record the amount, taxes and discounts, if applicable. In some instances, such as anticipated changes or a new business, it may be necessary to obtain information from collateral contacts. If a bankruptcy action has been initiated, the local district may get a statement from the bankruptcy trustee regarding the debt reorganization plan concerning the accessibility of assets and the anticipated gross income and expenses. The local district must be sure to document the verification used. 8. Offsetting Losses Of Self-Employed Farmers When the cost of producing self-employment income exceeds the income derived from self-employment as a farmer, such losses shall be offset against any other countable income in the household. The same principle shall be used in determining any net loss as is used to determine the income from the self- employed farm operations (previous year's tax return or current income). Losses shall be prorated over the year in a manner comparable to that used to prorate farm self- employment income. To be considered a self-employed farmer, the farmer must receive or anticipate receiving annual gross proceeds of $1,000 or more from the farming enterprise. NOTE: A household continues to qualify for the farm loss deduction for the remainder of the period that the self-employment income is annualized even when it is no longer engaged in a farming enterprise as long as the household meets the above definition of a self- employed farmer. The household's eligibility and benefits were calculated by prorating income and expenses annually. Therefore, the household would continue under the definition of a farmer for the remainder of the annual period, even if the household is no longer engaged in the enterprise. NOTE: A fisherman is equivalent to a self-employed farmer for purposes of the farm loss offset provision if the fisherman is self-employed, rather than an employee, and the fisherman receives or anticipates receiving annual gross proceeds of $1,000 or more from fishing. This applies even if the fisherman is only involved in catching or harvesting the fish. This applies to watermen and cray fishermen, as well as other fishermen. Fishermen produce food, and they are subject to the same uncertainties as farmers, such as market demands, weather conditions, and the environment, which could result in losses. 9. Determining Gross Income In determining the household's gross monthly income: a. All earned and unearned income is first totaled (minus appropriate exclusions), b. From this total the monthly farm loss income is then subtracted. The remainder is the household's gross monthly SNAP income subject to the appropriate gross monthly income eligibility test. NOTE: If there is an elderly or disabled member in the household, the household is exempt from the gross income eligibility test. 10. Determining Net Income In determining the household's monthly SNAP net income, the household's monthly self-employment farm loss income is first subtracted from the household's "other self-employment income," if applicable. Then: a. If a positive balance remains, this self-employment income amount is added to any other source(s) of earned income. The household's earned income deduction (as described in SNAPSB Section 12) would be determined based on this total. Normal SNAP budgeting methodology would then be applied from this point to determine the household's monthly SNAP net income. No additional farm loss offsetting would be necessary. b. If a negative balance remains, this is the household's remaining farm loss income. This remaining farm loss income (or a household's entire farm loss income when there is no other self-employment income to be offset) would be applied as follows in determining the household's SNAP net income: (1) Determine the household's total gross income excluding self-employment earnings. (2) From this total calculate and subtract the SNAP earned income deduction. (3) Add any countable unearned income to the balance. (4) From this balance subtract the monthly farm loss income (or remaining farm loss income when applicable as determined above). (5) Current SNAP budgeting methodology would then be applied from this point to determine the household's monthly SNAP net income. In summary, in determining the household's monthly SNAP net income the household's self-employment farm loss income is first offset against any additional household self-employment income. The remaining balance farm loss income is then offset against any non-self-employment earned income or unearned income to determine the household's SNAP net income. EXAMPLE: A household's monthly self-employment farm loss income is determined to be $100. The household's monthly countable income from additional self-employment equals $50. The household has a gross monthly earned income from non-self-employment of $500 and gross monthly unearned income is $300. Shelter expenses for the household would entitle the household to the maximum SNAP excess shelter deduction. The household’s SNAP gross income eligibility is determined as follows: $ 50 Net “other self-employment income” + $500 Gross non-self-employment earned income + $300 Unearned Income = $850 Total Income - $100 Farm Loss Income = $750 Total SNAP gross income subject to appropriate SNAP GIT. The household monthly SNAP net income is determined as follows: (First apply farm loss income against “other self-employment income”) $ 50 Net “other self-employment income” - $100 Farm Loss Income - $ 50 Farm loss income remaining to be offset as determined above (see calculation below) If no farm loss income remains to be offset, add the balance of the positive self- employment income amount to the household’s non-self-employment earned income and continue normal SNAP budgeting with no further farm loss income needing to be offset. $500 Gross non-self-employment earned income - $100 20% earned income deduction = $400 + $300 Unearned Income = $700 - $ 50 Farm loss income remaining to be offset as determined above = $650 - $204 *Standard deduction = $446 - $712 * Excess shelter deduction = $ 0 SNAP Net Income *Please note the standard deduction and excess shelter deduction cited are relative to the 2024-25 Standards. 11. Upstate WMS Instructions Budgeting Procedure For SNAP Cases With A Farm Loss Offset And Other Self- Employment Income - For cases which have both a farm loss (NEG-FARM) amount and other self-employment earned income (Family Day Care Income - 09, Net Business Income - 20, Income from Boarder/Lodger - 45, Net Income from Rental of House, Store, or Other Property, Worked more than 20 hours per week - 46, or Income from a Roomer - 48). Before the 20% Earned Income Deduction is calculated, ABEL: a. Subtracts the NEG-FARM amount from the total of all other self-employment earned income amounts. b. The remaining self-employment earned income amount, if there is one, and the full other earned income amount are added. c. This sum is multiplied by 20% to obtain the 20% Earned (Income) Deduction amount. See Examples 1 and 2. NOTE: One case circumstance still requires special attention. If the farmer has distributed from gross receipts, income to himself or any other of his SNAP household members, that income is not included in the calculation of the NEG-FARM amount. See Example 3. EXAMPLE 1: A farmer, his wife and three children are receiving SNAP. His monthly Negative Farm Exclusion Amount of $200 is entered as an additional exclusion in the "NEG-FARM" field. His wife is also self-employed with a net income of $385 per month. The 20% EARNED (Deduction Amount) is 20% of $185 ($385 other self-employment income minus $200 NEG-FARM amount). The remaining budget procedures remain unchanged. EXAMPLE 2: A farmer, his wife, and three children are receiving SNAP. His oldest child receives wages of $300 per week from a job and $124.50 is received semi-monthly from a Boarder/Lodger. The Boarder/Lodger exclusion - $194 and the farmer's loss of $200 are entered under Additional Exclusions. EXAMPLE 3: A farmer, his wife and three children are receiving SNAP benefits (as one household). One child is employed on the farm and receives wages of $500 per month from his father. The gross receipts for the farm are $2,500 per month, allowable operating expenses are $2,200 plus the $500 salary paid to the son. However, the salary paid to the HH member is not included in the Farm income calculation. $300 income is available to the SNAP HH. No NEG-FARM amount is entered. e 12. Certification Periods (See also Section 15) Households whose primary source of income is from self-employment (including self-employed farmers) or from regular farm employment with the same employer must be certified for up to 12 months if the income can be reasonably predicted and household circumstances are not likely to change. Annual certification periods may also be assigned to farmworkers who are provided their annual salaries on a scheduled monthly basis which does not change as the amount of work changes. It is customary to certify self-employed households in accordance with the submission of yearly tax forms. However, certification periods may also be certified to coincide with the sale of crops. For example, a household’s case is certified to coincide with the timing of its income tax return. A household files its income tax form in April each year and applies for SNAP in October each year. The household indicates that it does not anticipate any changes and that the self-employment income is intended to be its annual support. Based on the prior year tax form, the gross self-employment income was $22,000 and allowable SNAP expenses were $10,000, for an annual net self-employment income of $12,000. This amount must be divided by 12 and the resulting $1,000 amount must be used each month the household is certified until a new tax form is submitted or a change occurs. In this case, the local district should assign a six-month certification period because the household applied in October and count $1,000 net self-employment income each month from October through April. Households that receive other sources of income or whose self-employment income is intended to cover a period of time that is less than a year shall be assigned a certification period appropriate for the household's circumstances following the regular certification period standards. 13. Six Month Reporting Requirements - See Section 14. 14. Reporting Changes - See Section 14. References: 387.16 – Special Provisions for Household Circumstances 7 CFR 273.11 – Actions on Households with Special Circumstances 90 INF-6 Food Stamp Certification of Self-Employed Farmers J. Boarders 1. Households With Boarders A household with income from a boarder can participate in the program separate and apart from the boarding house residents if that household meets all of the program eligibility requirements. 2. Determining Income to Households Operating A Boarding House Boarders who pay a reasonable amount for room and board must be excluded from the owner's household to determine the household's eligibility and benefits. The income of a household owning and operating a commercial boarding house is treated as self- employment income and is calculated according to procedures in this section. For all other households, payment from the boarder shall be treated as self- employment income and the household's eligibility determined as follows: a. Income From the Boarder - The income from boarders shall include all direct payments to the household for room and meals, including contributions to the household's shelter expenses. Shelter expenses paid directly by boarders to someone outside of the household, such as to the landlord or utility company, shall not be counted as income to the household. b. Income From Foster Care Payments - Foster care payments in excess of allowable, verifiable, reimbursable expenses may not be excluded as income if the foster child for whom the payments are being received is a member of the SNAP household. Such payments must be treated as unearned income to the SNAP household. If the child is not included in the SNAP household, then the total amount of the foster care payments must be excluded as income to the SNAP household. c. Income From the Roomer - Money that a roomer pays to a household is self- employment income and is to be treated as specified in this section. However, before an individual is budgeted as a roomer, consideration should first be given to treating the individual as a non-household member, who shares in incurring household expenses. d. Cost of Doing Business - After calculating the income received from boarders, the local district must exclude that portion of the boarder payment which is a business cost. The cost of doing business must equal one of the following: (1) The cost according to Thrifty Food Plan for a household size that is equal to the number of boarders. (2) The actual documented cost of providing room and meals if the actual cost exceeds the appropriate Thrifty Food Plan. If actual costs are used, only separate and identifiable costs of providing room and meals to boarders shall be excluded. Furthermore, such costs cannot exceed the payments received from the boarder. e. Deductible Expenses - The self-employment net income will be added to other earned income, and the 20% earned income deduction applied. Shelter costs actually incurred by the household, even if the boarder contributes to the household for part of the household's shelter expenses, will be computed to determine if the household will receive a shelter deduction. However, the shelter costs cannot include any shelter expenses paid directly by the boarder to a third party, such as the landlord or utility company. f. Cost Of Meals - A reasonable monthly amount for meals shall be either of the following: (1) Boarders whose board arrangement is for three meals or more per day shall pay an amount which equals or exceeds the Thrifty Food Plan for the appropriate size of the boarder household; or (2) Boarders whose board arrangement is for two meals or less per day shall pay an amount which equals or exceeds two-thirds of the Thrifty Food Plan for the appropriate size of the boarder household. g. Payment For Meals - When the boarder's payments for room are distinguishable from the payments for meals, only the amount paid for meals will be evaluated to determine if reasonable compensation is being paid for meals. The reasonable monthly amount for meals shall be paid in cash and cannot be credited toward the overall monthly payment. Reference: 387.16 - Special Provisions for Household Circumstances 7 CFR 273.11 – Actions on Households with Special Circumstances 08 ADM 04 - Treatment of Income From Adoption Subsidy Payments and Foster Care Payments in Determining Food Stamp Program Eligibility and Benefit Amount K. Educational Income Educational grants, loans and scholarships that are intended for educational purposes other than general living expenses are excluded as income for SNAP. In addition, all educational income under Title IV of the Higher Education Act or under the Bureau of Indian Affairs student assistance program is excluded. 1. Definitions a. Educational Income - Educational Income includes scholarships, work study grants, educational grants, fellowships, deferred payment loans for education, and any other monies provided or issued to enable a person to obtain education at: b. A secondary school (high school) or a post-secondary school (college); a business, technical, trade, or vocational school, which normally requires a high school diploma or equivalency certificate for enrollment in the curriculum; college or university that offers degree programs regardless of whether a high school diploma is required; correspondence or on-line courses at least half time requiring a high school diploma or equivalent. c. School for the mentally or physically handicapped, vocational education program or program that provides a high school diploma or the equivalent of a high school diploma. d. Educational Expenses - Educational expenses are tuition, mandatory fees, dependent care expenses, cost of books and supplies, transportation costs, loan origination and insurance fees, and miscellaneous personal expenses, other than ordinary living expenses, incidental to a student attending a school, institution or educational program. e. Educational Personal Expenses - Expenses for personal needs that are incidental to a student attending a school, institution or educational program. These expenses do not include the everyday living expenses such as rent, clothing or cost of food which a student would incur even if he or she were not attending school. Judgment must be used to determine if a personal expense can be excluded as an educational cost. For example, although the cost of food is a personal expense a student would incur even if not attending school, the costs of meals that must be purchased at school because of the dictates of the student's class schedule are excludable. References: 387.11(f ) – Income Exclusions 387.10 – Income Standards 7 CFR 273.9 – Income and Deductions 02 ADM-7 Food Stamp Program Reauthorization Changes 12 INF-14 Supplemental Nutrition Assistance Program Policy – Student Eligibility (Replaces 11-INF-06) L. Anticipated Income 1. Anticipated Income If household income in the next certification period will differ from income in the previous 30 days, the anticipated income will be used to determine eligibility. Income cannot be budgeted if the amount or date of receipt is uncertain. If the exact amount of the income is not known, the portion which can be anticipated with reasonable certainty must be considered as income. In cases where the receipt of income is reasonably certain, but the monthly amount may fluctuate, the household may elect to have their income averaged. 2. Past Income as Indicator Income received during the past 30 days shall be used as an indicator of the income that is and will be available to the household during the certification period. However, the local district shall not use past income as an indicator of income anticipated for the certification period if changes in income have occurred or can be anticipated. a. If income fluctuates to the extent that a 30-day period alone cannot provide an accurate indication of anticipated income, the local district and the household may use a longer period of past time if it will provide a more accurate indication of anticipated fluctuations in future income. b. If the household's income fluctuates seasonally, it may be appropriate to use the most recent season comparable to the certification period, rather than the last 30 days, as one indicator of anticipated income. The local district shall exercise particular caution in using income from a past season as an indicator of income for the certification period. In many cases of seasonally fluctuating income, the income also fluctuates from one season in one year to the same season in the next year. c. The local district cannot automatically use past income as an indicator of anticipated income when changes in income have occurred or can be anticipated during the certification period. 3. Destitute Migrant or Seasonal Farmworker Households Any income from a new source that is anticipated after the date of application shall be disregarded for destitute migrants and seasonal farmworker households. See SNAPSB Section 5. All other households anticipating receipt of income in the month of application shall have their income budgeted for the month of application providing there is reasonable certainty as to the amount and receipt of the income in the month of application. References: 387.15 – Determining Food Stamp Benefit Levels 7 CFR 273.10 – Determining Household Eligibility and Benefit Levels M. Income Only In Month Received Income anticipated during the certification period can be counted only in the month received. Whenever a full month's income is anticipated but is received on a weekly or bi-weekly basis, the local district must determine the monthly income by one of the following methods: • Use the local district TA conversion standard. • Use the exact monthly figure if it can be anticipated for each month of the certification period. 1. Wages Withheld Wages withheld at the request of the wage earner count as income available to the household for the month the wages normally would have been received. However, wages withheld by the employer (even in violation of law) cannot be counted as household income unless wages have been withheld previously and the wage earner reasonably anticipated that they will request and receive an advance from those previously held wages. The amount of the advance will then be counted as income in the month it is received. 2. Federal or State Benefit Income Households receiving TA, Military pay, SSI or Social Security payments or similar Federal and State benefits on a recurring basis shall not have their monthly income from these sources varied merely because mailing cycles may cause two payments to be received in one month and none in the next month. 3. Destitute Migrant or Seasonal Farmworker Households Destitute migrant or seasonal farmworker households must have their eligibility and level of benefits calculated for the month of application considering only income which is received between the first of the month and the date of application. 4. Travel Advances If a travel advance is, by written contract, an advance on wages that will be subtracted from the wages later earned by the employee, rather than a reimbursement, the wage advance shall count as income when received. Reference: 387.14 - Determination of food stamp eligibility N. Income Averaging 1. Households Electing To Have Income Averaged Any household, except destitute migrant or seasonal farmworker households, may elect to have their income averaged. The local district must use the household's anticipation of income fluctuations over the certification period. The number of months used to calculate the average income need not be the same as the number of months in the certification period. EXAMPLE: If fluctuating income for the past 30 days and the month of application are known and, with reasonable certainty, are representative of the income fluctuations anticipated for the coming months, the income from the two known months may be averaged and projected over a certification period of longer than two months. NOTE: Income shall not be averaged for a destitute migrant or seasonal farm worker household, since averaging would result in assigning to the month of application income from future periods which is not available to the destitute household for its current food needs. 2. When A Household's Income Must Be Averaged a. Self-Employment Or Contract Income - Households which receive their annual income by contract or self-employment in a period of time shorter than a year shall have their income averaged over a 12-month period, provided the income from the contract is not received on an hourly (as defined in paragraph (2) below) or piecework basis. These households include school employees, sharecroppers, farmers and other self-employed individuals. (1) A contract employee is one that has an agreement with an employer to work a certain length of time or perform a specific job. This may be either a written contract or an implied contract, e.g., tenured teachers. (2) An employee who is paid hourly is one that is paid based on the number of hours they work when there is no established work schedule, e.g., a handyman who performs odd jobs on a non-recurrent basis. (3) Acceptable verification can be a statement from the employer or a written document, such as a copy of the contract or agreement that shows the terms of employment. A teacher's aide who works 10 months of the year for $15.00/hr and 5 hrs/day, who has a statement from the Department of Education that it intends to rehire them for the following school year, would be a contract employee whose income would be annualized. The average amount of monthly income from the school job, plus any other income the household may have, would be counted in determining if the household is entitled to SNAP benefits including expedited service. NOTE: Migrant and seasonal farm workers must not have their income averaged over a 12-month period. Reference: 387.14 - Determination of food stamp eligibility