1115.015.00 Income Exclusions

Excluded income is divided into four categories:

• excluded earned income (EI);
• excluded unearned income (UI);
• educational income (ED); or
• volunteer work (VW).

The income is entered into FAMIS on the Income (FMX0) and Income Amount (FMX3) screens. FAMIS knows by the income source code, and in combination with other fields for some of the income, whether the income is included or excluded income for the Food Stamp Program. Refer to the FAMIS Income Code Chart for more information. Record a comment as outlined in the FAMIS Comments Quick Reference Chart .

Verify irregular income. The remaining income exclusions do not ordinarily need to be verified unless FSD has inconsistent, unclear, or contradictory information regarding the income on the application, in the case, or with information received by FSD. Refer to specific policy regarding excluded income. The type (EI, UI, ED, or VW) and source codes are listed in parenthesis where applicable.

• income in kind,
• vendor payments,
• compensation in lieu of wages,
• irregular income,
• loans,
• reimbursements,
• representative payee payments,
• earnings of children,
• disaster payments,
• Domestic Volunteer Service Act (DVSA) payments - not Americorps or VISTA,
• Work Study/educational income,
• non-recurring payments,
• relocation assistance,
• Indian or Alaskan Native payments,
• WIA income,
• recoupment payments,
• military payments, and
• other excluded income.

1115.015.05 Income in Kind

Exclude any gain or benefit not in the form of money payable directly to the EU, (such as income in benefits, including meals, clothing, public housing, produce from a garden, etc.) that is not received as the direct result of an individual's own labor or services (Type UI - Source IK).

1115.015.10 Vendor Payments

Exclude payments paid to a third party for an EU expense as follows:

• If a person or organization outside of the EU makes a direct payment using its own funds to an EU's creditors or a person or organization providing a service to the EU, exclude it. This is not shown as income on the Income (FMX0) screen.

  EXAMPLE: Mrs. Todd's brother, who lives in another town, pays her landlord her rent each month from his own funds. The rent payment made by the brother is not considered income.

• Exclude rent or mortgage payments made to landlords or mortgagees by HUD or by state or local housing authorities. This is not shown as income on the Income (FMX0) screen.
• Exclude public assistance payments by a government agency to a child care institution for day care for an EU member, for medical assistance, or for energy assistance. (Type UI - Source IK)
• Exclude General Assistance (GA) vendor payments from income. DMH vendor payments are considered GA and are excluded from income. All DMH payments are vendor payments, therefore, exclude all DMH payments from income. (Type UI - Source DH)
• Exclude emergency IM or GA payments provided to a third party on behalf of a migrant or seasonal farm worker EU while the EU is in the job stream. This assistance may include, but is not limited to, emergency vendor payments for housing and transportation. (Type UI - Source IK)

  NOTE: Consider payments in money that are not made to a third party but made directly to the EU a contribution (Type UI - Source CO) and count as included unearned income. This does NOT include payments made directly to the EU or the utility provider from HUD or Farmers Home Administration for utilities. (Type UI - Source HD/HV/S8)

Count monies legally obligated and otherwise payable to the EU diverted by the payment provider to a third party for an EU expense as diverted earned income or diverted unearned income. The income is coded as the source of income it is.

EXAMPLE: Mr. A's employer diverts part of his paycheck to Mr. A's landlord for his rent. This is coded as WA - wages.

1115.015.15 Compensation in Lieu of Wages

When an individual receives compensation in lieu of wages, such as working for rent, the value of the compensation is excluded. This occurs when the individual is working for the compensation instead of the employer paying wages to the individual (Type EI - Source CL).

1115.015.20 Irregular Income

Exclude earned income (EI) such as overtime, bonuses, commissions, or other wages that are irregular and are not expected to continue.

• If the overtime, bonus, commission, or other wage is paid on the same check as regular wages, enter the amount that is to be excluded in the Irregular Amount field on the Income Amount (FMX3) screen.
• If the overtime (WA), bonus (BO), commission (CM), or other wage (WA) is paid on its own check, enter the income source and information as normal, but enter N in the Include (Y/N) field.

Exclude earned income (EI) or unearned income (UI) received on a casual or unpredictable basis that cannot be reasonably anticipated to be available during the certification period and is not in excess of $30 in a quarter.

1115.015.25 Loans

Exclude loans (Type UI - Source BF) from countable income as follows.

• Bona fide loans: A loan is bona fide if:
  • it is supported by a written agreement to repay within a specified time or received from an individual or establishment engaged in the business of making loans; or
  • there is an obligation to repay (with or without interest); or
  • there is a pledge of real or personal property or anticipated income with the intent to repay when funds become available or future anticipated income is received; or
  • there is a written timetable and plan for repayment.

  NOTE: Do not confuse loans with advances on income which are counted as income when received. Also, the availability of a credit card or open-ended bank account is not considered in determining income for the EU.

• Home equity conversion loans or plans allow EUs to borrow money or receive payments against the value of their home.
  • Reverse Annuity Mortgage Loan (RAM): Under this plan, the EU borrows money against the value of the home. They receive monthly payments (less interest and fees) for a certain period of time, such as ten years. The mortgage holder holds a lien on the property until repayment is completed. Repayment occurs when: (1) the house is sold; (2) the owners no longer occupy the house; or (3) the owners die and repayment is taken from estate settlement. Treat money received from RAM as a loan and exclude it from income.
  • Home Equity Conversion Sale Leaseback Program: Under this plan, an investor purchases the home from the homeowner, pays the purchase price in a series of payments, and gives the homeowner a lease for life or until the homeowner voluntarily secedes occupancy of the property as his/her residence. The purchase price is based on the homeowner's equity in the home at the time of the sale. The property is leased back to the homeowner at or below the going market rate. The sale leaseback agreement also provides lifetime income to the former homeowner. Send sale leaseback agreements to State Office for evaluation. Whether proceeds from the sale of the property is considered income depends on the particular terms of the sales agreement.
• Exclude all educational loans. (Type ED - Source NA or N4)

If a loan is not a bona-fide loan, enter the income source code as a non-bona fide loan (Type UI - Source NB). FAMIS includes this as unearned income.

1115.015.30 Reimbursements

Exclude reimbursements (Type UI - Source RM or RX), unless the reimbursement is for normal EU living expenses, such as rent or mortgage payment, personal clothing, or food eaten at home (Type UI - Source RL).

To be excluded, these payments must be provided specifically for an 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. Examples of excludable reimbursements not considered to be a gain or benefit to the EU are listed below.

• Reimbursements or flat allowances for job or training related expenses such as travel, per diem, uniforms, and transportation to and from the job or training site; however, these expenses, if not reimbursed, are not otherwise deductible. Also exclude reimbursements for travel expenses incurred by migrant workers.
• Reimbursements for out-of pocket expenses of volunteers incurred in the course of their work.
• Medical or dependent care reimbursements such as Medicare reimbursements and/or payments made to the claimant under Child Care and Developmental Block Grant (CCDBG).
• Non-federal reimbursements or allowances to students for specific education expenses, such as travel or books. Count allowances for living expenses, such as food or clothing, as income and not a reimbursement.
• Reimbursements received by the EU to pay for services provided by Title XX of the Social Security Act.
• Individual and Family Grant assistance received under Section 408 of the Disaster Relief Act of 1988.
• A HUD or Farmers Home Administration utility allowance which exceeds the rent (negative rent payment). (Type UI - Source HD/HV/S8)

1115.015.35 Representative Payee Payments

A representative payee is defined as a third party payee receiving income on behalf of a beneficiary. The most common representative payments are those made in grant programs, such as SSI, RSDI, and Temporary Assistance, to payees where beneficiaries are unable to manage the payment. A beneficiary is defined as a person for whom the income is to benefit. The income is coded as the type of income it is (SSI, RSDI, etc.).

The portion of the money that the representative payee uses for himself/herself is considered income to the representative payee's EU and not to the beneficiary's EU (Type UI - Source RH for the representative payee's EU). Do not show this part of the income to the beneficiary's EU. If the payee is a member of the beneficiary's EU, count the payment once to the EU.

A qualified organization (a community based nonprofit social service agency bonded or licensed in the State it serves) acting as a representative payee for an RSDI or SSI recipient may collect a fee for handling the recipient’s benefits. This fee is not considered income to the recipient and is excluded.

NOTE: If the intended beneficiaries of a single payment are not both EU members, exclude any identifiable portion of the payment intended and used for the care and maintenance of the non-EU member. If the non-EU member's portion cannot be readily identified, evenly prorate the payment among intended beneficiaries. Apply the exclusion to the non-EU member's pro rata share or the amount actually used for the non-EU member's care and maintenance, whichever is less.

1115.015.40 Earnings of Children

Exclude salary/wages (Type EI - Source WA) and income from self-employment (Type EI - Source SE) earned by a child under age 18 living with a natural, adoptive, or step-parent, or who is living under the parental control of an EU member other than a parent. The child must either be (1) attending elementary or secondary school, or (2) attending GED or home-school classes recognized by the state or local school district. Enter the income as usual, but enter a “Y” in the Under Parental Control field on the Income (FMX0) screen. FAMIS knows to exclude the income of individuals under age 18 who are under parental control of an EU member.

If the child's earnings or amount of work performed cannot be differentiated from that of other EU members, equally prorate total earnings among the working members. Exclude only the child's pro rata share.

This exclusion does not apply to the training allowances or unearned income received by the child. Nor does it apply if the student is an emancipated minor or living alone as he/she is no longer considered a child residing in the EU/under parental control.

Exclusion of this income does not change because of temporary interruption in school attendance, such as semester or summer vacations, provided the child's enrollment resumes following the break. Accept the EU's statement that the child intends to return after the break.

The month after the child turns 18 is the first month the earned income must be budgeted.

1115.015.45 Disaster Payments

Exclude disaster payments authorized by the Disaster Assistance Act of 1988 (Type EI - Source DP) and disaster payments not authorized by the Disaster Assistance Act of 1988 (Type UI - Source DR).

1115.015.50 Domestic Volunteer Service Act (DVSA) - not AmeriCorps or VISTA

Exclude income received by volunteers for services performed in programs stipulated in the Domestic Volunteer Services Act of 1973 (Type EI - Source DV). Programs include:

• Retired Senior Volunteer Program;
• Foster Grandparent Program;
• Older American Community Service Program;
• Service Corps of Retired Executives; and
• other programs coordinated by ACTION.

1115.015.55 Work Study/Educational Income

Exclude payments paid to students through the Work Study (Type EI - Source WK or W4) program. It is necessary to verify work study only to determine whether the work study is Title IV funded for student eligibility criteria.

Exclude educational income, including loans, grants, and scholarships. The income is coded as follows.

• WIA (JTPA) student tuition (Type ED - Source JS)
• federal funded assistance TIV (Type ED - Source NA)
• student assistance not title iv funded (Type ED - Source N4)
• Veteran's Education Assistance (Type ED - Source VE or VC)
• Bureau of Indian Affairs payments (Type ED - Source BI)
• Graduate Student Income (Type ED – Source GI)

1115.015.60 Non-recurring Payments

Exclude money received in the form of non-recurring lump sum payments. This may include but is not limited to: insurance settlements (when received in a lump sum as distinguished from periodic amounts); sale of property (except property related to self-employment); cash prizes and awards; inheritances; retroactive lump sum Social Security and Railroad Retirement; retroactive pension payments; income tax refunds; IM retroactive payments for a prior month; IM deficiency payments; some military re-enlistment bonuses, and reimbursed funeral expenses. This is not shown as income on the Income (FMX0) screen.

1115.015.65 Relocation Assistance

Exclude payments received under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, whether they are for one or more years. (Type UI - Source RA)

• Payments to persons displaced as a result of the acquisition of real property.
• Relocation payments toward the purchase of new housing to the displaced owner who purchases and occupies the dwelling.
• Replacement housing payments to displaced persons not eligible for a homeowner's payments, such as renters.

The full amount of the rent payment made by the relocation EU is shown as a shelter cost.

1115.015.70 Indian or Alaskan Native Payments

Exclude the following.

• Benefits received under Alaska Native Claims Act. (Type UI - Source N2)
• Payments received by certain Indian tribal members as follows:
  • income received from sub marginal land of the United States held in trust for certain Indian tribes (Type UI - Source BI), and
  • relocation assistance provided to the Navajo and Hopi tribes (Type UI - Source BI).
• Income derived from the disposition of funds to the Grand River Band of Ottawa Indians. Also, payments made under the following: P.L. 93-531, P.L. 94-114, P.L. 94-540, P.L. 95-433, P.L. 96-420, P.L. 97-403, P.L. 97-408, P.L. 99-346, P.L. 98-123 and P.L. 98-124. If needed, contact the policy unit for clarification. (Type UI - Source BI)
• Payments up to $2,000 for funds held in trust by the Secretary of Interior for the benefit of Indians. The $2,000 exemption applies to each separate payment to each Indian. Only amounts in excess of $2,000 are counted as income or a lump sum, whichever is appropriate (includes payments under P.L. 97-458, 96 Stat. 2512 of January 12, 1983; P.L. 98-64, 97 Stat. 365, August 1983; P.L. 99-377, August 8, 1986, P.L. 99-377 and P.L. 98-500 of October 17, 1984), P.L. 103.66, Section 13736, 10/07/93. Enter the first $2000 of the payment as Type UI - Source BI. Enter the remaining amount of the payment as Type UI - Source PS. FAMIS excludes the BI payment and includes the PS payment.

1115.015.75 WIA Income

Exclude income received for any of the following WIA activities:

• work experience (Type EI - Source J2);
• earnings from on-the-job training under Title I for those individuals under age 19, whether in school or not, under the parental control of another adult EU member (Type EI - Source J1 - enter a “Y” in the Under Parental Control field on the Income (FMX0) screen);
• cash or in-kind assistance for supportive services, such as transportation, health care, child care, meals, etc. (Type UI - Source J7);
• Job Corps living allowance/allotment (Type UI - Source JA) and Job Corps training related expenses (Type UI - Source JT)
• school tuition (Type ED - Source JS).

1115.015.80 Recoupment Payments

Exclude monies withheld from any income source to repay an overpayment. The repayment may be voluntary or involuntary. Income sources may include IM, Temporary Assistance, Social Security, SSI, earned income, veteran's benefits, etc. This income is not shown on the Income (FMX0) screen.

EXCEPTION: If Temporary Assistance is reduced due to failure to comply with program requirements, the reduction is not a recoupment. Budget the reduction in Temporary Assistance following policy in 1115.080.00 Prohibition In Increasing Food Stamp Benefits.

1115.015.85 Military Payments

Exclude the following.

• The portion of a military retirement payment distributed to an ex-spouse under a divorce decree property settlement. This income is not shown on the Income (FMX0) screen for the military retiree.
• Mandatory deductions from military pay for education purposes while the individual is enlisted. Do not include this income on the Income (FMX0) screen.
• Exclude Agent Orange settlement payments to veterans from Aetna Life and Casualty. (Type UI - Source AO) Monthly VA benefits issued by the Department of Veterans Affairs as a result of exposure to Agent Orange are considered income. (Type UI - Source AV)
• Nonrecurring lump sum bonuses: If an EU receives a one time lump-sum bonus, it is exempt from income as a nonrecurring lump-sum payment. The money is counted as a resource in the month received. This income is not shown on the Income (FMX0) screen. If an EU receives half of the bonus in a lump sum with the remainder paid in equal annual installments, the bonus is counted as earned income (Type EI - Source BO).
• Additional payments to members of the United States Armed Forces deployed to a designated combat zone. This exclusion only applies if the additional pay was not received immediately prior to serving in the combat zone. (Type UI - Source MD)

Example: Sgt. G is deployed to Korea and has been providing $700.00 to his family. On 01/10/05, Sgt. G receives orders and is deployed to a designated combat zone on 02/02/05. He now provides $1,000.00 to his family. The $300.00 additional income is excluded because he started sending the additional income after his deployment to the designated combat zone. Enter $700.00 as income source code AA and $300.00 as source code MD. The $700.00 source code AA is included for food stamps, Child Care and Temporary Assistance. The $300.00 source code MD is excluded for food stamps, Child Care, and is included for Temporary Assistance.

1115.015.90 Other Excluded Income

The following income is also excluded. The type (EI, UI, ED, or VW) and source codes are listed in parenthesis where applicable.

EXCEPTION:  Individuals voluntary enrolled in METP are eligible for reimbursement of transportation and child care expenses. This allowance is NOT income for Food Stamp purposes and not entered into the system.

• WIC: payments or benefits received under the WIC Program (Special Supplemental Food Program for Women, Infants, and Children). This income is not shown on the Income (FMX0) screen.
• Energy Assistance Payments: exclude federal energy assistance payments provided through the Department of Health and Human Services, Low Income Energy Assistance Program. Exclude any payments received from State or local energy assistance programs and Federal or State one-time assistance for weatherization or emergency repair or replacement of heating or cooling devices. (Type UI - Source EA)
• Title IV-D Child Support Payments: child support payments received by Temporary Assistance participants that must be transferred to the agency administering Title IV-D, to maintain Temporary Assistance eligibility. This is not shown as income on the Income (FMX0) screen. Count DCSE refunds to a Temporary Assistance/FS case as income.
• Cost of producing self-employed income. These are shown as income expense codes on the Income Expense (FMX1) screen.
• Missouri Senior Citizen's Tax Credit: consider a resource when received and disregard as income. The credit is based on individuals who rent or pay property tax. If the EU receives this tax credit, the credit does not affect the EU's shelter expenses. (Type UI - Source MO)
• Payments made to individuals 55 years or older from SCSEP of the Older American's Act, including Green Thumb (Type EI - Source GT), Experience Works, and Mature Worker Program are excluded. (Type UI - Source OA for all but Green Thumb). Confer with offices administering programs for the elderly to determine which projects are authorized by Title V.
• Donations: exclude cash donations from non-profit charitable organizations (Type UI - DN/DO).
• Foster Care Payments: payments for Foster Care are excluded from EU income unless the foster child or adult is included in FS EU membership. If the foster child or adult is not included in the food stamp EU, do not show as income on the Income (FMX0) screen.
• Chaffee Foster Care to a third party: payments made to a third party are excluded. (Type UI - Source CH)
• Wartime Relocation of Civilians payments authorized under Public Law 100-383. (Type UI - Source RA)
• Wartime Relocation of Civilians: payments made to eligible individuals of Japanese ancestry under Title I of Public Law 100-383 up to $20,000 each (Type UI - Source RJ) and certain eligible Aleuts up to $12,000 each (Type UI - Source RS) are excluded.
• Earned Income Tax Credit (EITC) income received as a lump sum or as advance payments. Exclude the payment in the month received and the following month. (Type UI - Source TC)
• Child Nutrition Assistance: the value of assistance provided to children under the Child Nutrition Act of 1966 (School Breakfast Program). (Type UI - Source CN)
• Radiation Exposure Compensation: payments made under P.L. 101-425, Section 6 (h)(2), the Radiation Exposure Compensation Act of October 15, 1990. (Type UI - Source RD)
• PASS Account: money SSI recipients set aside under an approved plan for achieving self-support (PASS). SSA must approve the written plan. (Type UI - Source PA)
• Achieving a Better Life Experience (ABLE) Account: Contributions to and interest, dividends, or other distributed earnings in an ABLE account. Also exclude from income payments made from an ABLE account for qualified disability expenses. (TYPE UI – Source AD)
• Youthbuild Program (Type EI - Source YB).Exclude payments paid to individuals in Youthbuild. Individuals who participate in Youthbuild receive a combination of classroom academic and job skills development, as well as on-site training in a construction trade.
• AmeriCorps Program: Exclude payments received under the AmeriCorps Program. (Type EI - Source AE/AM)

• Trade Adjustment Assistance (TAA) and Trade Readjustment Allowance (TRA): these benefits are available to workers who lose their jobs or whose work hours and wages are reduced as a result of increased imports. TRA is a weekly benefit payable to eligible workers following exhaustion of unemployment benefits. It is paid only to individuals enrolled in a training program. An individual may also receive an allowance for transportation and living expenses if attending training or conducting a job search beyond the normal commuting distance from home. If the individual finds a job beyond the normal commuting distance from home and wants to relocate to the job site, TAA may provide a relocation allowance. Count as income TRA and TAA payments for living expenses (room, board, clothing, etc.) (Type UI - Source TL). Exclude from income TRA and TAA allowances for transportation, education, and relocation expenses (Type UI - Source TN).

  Employment Security sometimes combines money for living expenses and transportation into one check. A check which exceeds the weekly amount shown in the IMES screen generally includes a transportation reimbursement. To correctly decide what amount to budget as income, ask the participant what kind of payment is included in their check.

• Crime Victim's Fund payments: these benefits are available to victims of crimes, paid by a crime victim compensation program and are excluded. (Type UI - Source CV)
• Ricky Ray Hemophilia Relief Fund Act of 1998: settlement payments from this fund are excluded from income. (Type UI - Source RI)
• Veteran Benefits and Health Care Improvement Act of 2000: benefits are being paid for the children of women Vietnam veterans who suffer from certain birth defects, including spina bifida. These benefits are excluded. (Type UI - Source SP)
• VISTA (payment to volunteers under Title II of the Domestic Volunteer Services Act of 1973 (Pub. L. 93-113)): excluded for those individuals receiving Food Stamps or public assistance at the time they joined the Title I program.

Always review the Food Stamp Budget Summary (FSBUDSUM or FM4A) screen prior to authorizing a case action. From the Budget Summary screen press F14=INCSUM to view the Income Summary Detail (INCSUMM or FM33) screen to ensure income you expect to be budgeted is included in the budget. If the income is incorrect, return to the appropriate screen and correct the inaccurate information.