Unearned Income 430-05-50-20-10

(Revised 10/01/16 ML3479)

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Unearned income is income not gained by current labor, service, or skill. Most unearned income is the result of past labor, services, or investments, which have enabled the individual to receive a current benefit or pension.

If unearned income is withheld for:

• Child support or taxes, the gross amount must be counted.
  
  
• Repayment of an overpayment from the same source, the net amount must be counted.

EXCEPTION:

When there is a reduction in a TANF benefit due to failure to perform a required action or for IPV and an overpayment is being recouped, the gross amount of the TANF grant must be counted as income if the individual was receiving SNAP benefits at the time the penalty was imposed.

• Repayment of another source, the gross amount must be counted.

Examples:

1. Back Taxes

2. Defaulted Student Loan

When unearned income is held at the request of an individual, it is considered income in the month normally received.

Unearned income includes, but is not limited to:

1. Payments from Social Security Administration:

• Retirement, Survivors, and Disability Insurance (RSDI)
• Supplemental Security Income (SSI)
• Presumptive SSI

Lump sum retroactive adjustments from Social Security due to changes in an individual’s earnings record will be considered as follows:

If the individual received SSA benefits AND had earnings in the year prior to the adjustment, the adjustment will be considered a recurring lump sum benefit.

If the individual did not receive SSA benefits OR did not have earnings in the year prior to the adjustment, the adjustment will be considered a non-recurring lump sum benefit.

2. Unemployment and Workforce Safety and Insurance
   
   These benefits are paid on an Electronic Benefits Card and are considered income:

1. On the date received; or
   
   
2. When available and the recipient has a legal ability to access the income for support or maintenance.

If the household cannot verify the date of actual receipt, the receipt date is deemed to be either:

1. The date funds were deposited into the account based on a bank statement from U.S. Bank or their personal bank account; or
   
   
2. Two working days after the date the WSI or UIB was processed.

3. Other benefits, including but not limited to:

• Monthly or regular payments from annuities, pensions and other retirement plans (including dividends and interest). Penalties if any should be deducted from the gross disbursement amount.
  
• General Assistance
  
• Income deemed to a community spouse or household member
  
• Military Allotment received from non-household member.
  
• Short term or long term disability or loss of time insurance payments for illness or injury paid by someone other than the employer (AFLAC, CIGNA, Thrivent, etc.).
  
• Railroad benefits
  
• Veterans benefits other than those designated for education
  
• Union Compensation during strikes

EXCEPTION:

Households with a member who is on strike may or may not be eligible for SNAP

4. TANF and Diversion Assistance, including:

• Job Retention portion of TANF Transition Assistance
  
• TANF Kinship Care

EXCEPTION:

JOBS Supportive Services, TANF Supportive Services and Special Items of Need that represent a reimbursement are not counted as income.

The housing allowance is not considered a reimbursement, and is counted as unearned income.

When there is a reduction in a TANF benefit due to failure to perform a required action or for IPV and an overpayment is being recouped, the gross amount of the TANF grant must be counted as income if the individual was receiving SNAP benefits at the time the penalty was imposed.

For TANF Pay After Performance, during the first four months the grant for the children's needs must be anticipated and counted. Since the portion of the grant for the Pay After Performance individual's needs cannot be anticipated during any of the first four months, it is not anticipated. If the individual is complying and their needs are prospectively included in the grant for month five, the grant including the individual's needs must be counted.

5. Child Support and Spousal Support - Court-Ordered and Voluntary
   
   
6. Unearned income as a result of self-employment.
   
   
7. Tribal Payments and Individual Indian Monies (IIM) Accounts
   
   
8. Foster Care Payments, including continuing education and job-training through PATH Inc.

EXCEPTION:

Foster care payments when the foster child is not included as a household member are excluded.

9. Recurring Lump Sum Payments are those payments that can be reasonably anticipated to be received more than once. Payments may be recurring monthly, quarterly, yearly, etc.
   
   Recurring payments are prorated over the period of time intended to cover.
   
   Recurring Lump Sum Payments include but are not limited to the following:

• Gambling winnings
• Mineral lease bonuses, oil and gas royalties. Any mandatory production taxes withheld prior to distribution are not counted and are allowed to reduce the amount of countable income. Any income taxes withheld are not allowed to reduce the amount of countable income.
• Alaska Permanent Fund Payments
• Insurance settlements
• Inheritance
• Income received from a trust - Submit SFN 1947 - Request for Trust Review, along with complete copies of all trust agreements to the Legal Advisory Unit of the Department of Human Services for review.
• Lump sum retroactive social security payments when the individual had earnings in the year prior to the adjustment.

10. Cash Contributions received on a regular basis that can be reasonably anticipated.

EXCEPTION:

Cash contributions of less than $30 per quarter are not counted.

11. Contracts for Payment. When an applicant or recipient has sold property with a contract to receive a series of periodic payments, rather than one payment, the arrangement is usually called a "contract for deed". The essential feature of the contract for deed is the right to receive future payments, usually coupled with a right to get the property back if the payments are not made. Contractual rights to receive money payments also arise out of other types of transactions. The valuable contract document may be called a note, accounts receivable, mortgage, or by some other name.

NOTE: Some contractual rights may be written so the lender has the right to demand payment at any time. If so, the note is considered a demand note and can be called in at any time. If a note is written so the lender does not have the right to demand payment but the note is in default, it also becomes a demand note. Contractual rights may or may not have collateral or security to guarantee payment.

The payments will include both interest and a portion of the sale price of the property that was sold (principle) and must be calculated separately.

The interest portion of payments received for any contractual right to receive payments (such as Contracts for Deed) must be counted as unearned income. The payment must be prorated over the period of time intended to cover.

12. Refugee Cash Assistance Payments – Payments received under the Refugee Cash Assistance Program or the Wilson/Fish Alternative Program.
    
    
13. State Long Term Care Subsidy – Individuals receiving a payment of up to $20 from the State Long Term Care Subsidy Program.
    
    
14. Money deposited into a Joint Checking or Savings Account - Money deposited, when the depositor is not a member of the household, is counted as unearned income in the month in which it is deposited.
    
    Money deposited by an ineligible household member will also be counted as unearned income. Excluded income that is deposited in a joint checking account by an ineligible student is not counted as income.

EXCEPTION:

If the client's name appears on a signature card, but no member of the household has an ownership interest in that account, funds in the account are not available as income or asset.

15. Money obligated to the household which is diverted by the household for an expense.

Examples:

1. TANF benefits diverted to a Protective Payee

2. Payment diverted to a Representative Payee