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Work and Public Housing and TANF Benefits

Authored By: Georgia Legal Services Program® LSC Funded

Information

Working in Public Housing
 

Susan Reif
Georgia Legal Services Program
Last Revised: December 2003

Q: What does the PHA allow me to exclude from annual income if I am receiving Temporary Assistance to Needy Families (TANF) benefits and working?

In public housing income is based on the amount of income of a household. Income includes any and all amounts, whether monetary or not, that go to, or on the behalf of the head of the household or any other member residing in the house. Annual income includes amounts that are actually received and amounts that a family.

Families receiving unemployment compensation, TANF, and/or social security, must include the amount of the payments received as annual income for purposes of the PHA. However some types of income are not included as annual income. Money not counted as annual income for calculating public housing rent includes:

* Amounts received under TANF that are specifically for reimbursement of expenses incurred or paid for medical expenses.

* Amounts received by a resident that are specifically for reimbursement of expenses incurred or paid that allow the participant to engage in a specific program. EX. Transportation, clothing, child care.

* Temporary, nonrecurring payments, such as the TANF to Work Support Payment.

* Income in excess of $480 from the employment of children under the age of 18.

Income from the employment of a full-time student, other than the head of household.

Q: What deductions can I take as a TANF recipient living in public housing?

Some subsidized housing tenants are able to make the following deductions:

A deduction of all reasonable expenses for the care of children under 13 years of age in order for a family member to seek education, employment or to maintain employment

A deduction of reasonable, unreimbursed expenses that exceed 3% of a family income for the attendant case of a family member with a disability needed to enable a family member to be employed. The deduction can not be more than the amount of income from the employment.

Q: What is the earned income disregard?

The earned income disregard allows a qualified family living in public housing to exclude a portion of their earnings from being included in annual income for purposes of calculating rent. You are eligible for the earned income disregard if you live in public housing and:

* a family member who was unemployed for one or more years prior starts working

* a family member starts working as a result of participating in any economic self-sufficiency or other job training program

* a family whose annual income increases from either new employment or increased earnings of a family member, who received TANF within the last six months and has now started working.

NOTE: The TANF program may not only be limited to monthly cash benefits, but it could also include benefits such as one-time payments, wage subsidies, and transportation assistance provided that the total amount over the 6 month period is at least $500.

Q: How does the earned income disregard work?

The earned income disregard requires the PHA to exclude from annual income any increase in income resulting from employment. The disallowance begins on the date of employment or when the family first experiences the increase in earned income. For 12 months all (100%) of the earned income is excluded from the rent calculation. During the second 12 months, 50% of any earned income is excluded. Both the 100% disregard and the 50% disregard may be used only once.

EXAMPLE: Anna lives in public housing. She is in compliance with the community service requirement and pays rent based on her income. Anna has been unemployed for 2 years, however she has recently become employed at a local store. She earns approximately $150 a week for a family of three.

While Anna does have to report the new income to the PHA, her rent should not increase. The earned income disregard allows the PHA to disregard the additional money she is earning. This is because 1) she is a qualifying family by having been unemployed for more than one year prior to her current employment, and 2) this is her first time using the disregard so the full amount is disregarded for 12 months.

Effect for TANF Recipients: If Anna continues to work for another year, she will be able to disregard 50%, or $75, of her earned income. The 100% disregard only covers 12 months, and once it has expired, an individual may only disregard %50 of the earned income for another 12 months. If in addition to living in public housing Anna is receiving TANF benefits she may be able to exclude additional amounts received from income.

For instance, Anna has two children who require child care. If obtaining child care is essential to work activities, she is able to receive reimbursement for childcare she paid. These payments are excluded from income and should not affect her rent.

Q: How do I establish an individual savings account through the PHA and how does it work?

A PHA can choose to offer individual savings accounts to tenants receiving the earned income disregard. If offered by the PHA, paying a higher rent is calculated by including the otherwise excludable earned income. The PHA then deposits the excess rent into the savings account. The excess rent is that portion due because of the earned income which could have been excluded from income.

The PHA is also required to provide the family with an annual report on the account. If the family moves from public housing, the PHA shall pay the tenant any balance in the account, minus amounts owed to the PHA. Tenants may make withdrawals from their individual savings account in order to purchase a home, pay education costs of family members, move out of public or assisted housing, or pay other authorized expenses promoting self-sufficiency.

EXAMPLE: Carrie has been receiving TANF benefits for the last three months. Recently she has become employed at a local store. She is receiving a weekly salary of $125. Normally the amount she is earning would be excluded from her income due to the earned income disregard. This is because 1) she began receiving TANF benefits within the last six months and she has now become recently employed , and 2) she has not been sanctioned by the local Department of Family and Children Services (DFCS) Office. However, Carries's PHA has presented her with the option of establishing an individual savings account.

As a result of Carrie choosing to establish the individual savings account. The amount of rent she would pay would increase due to the amount of increased income, however, the amount over the previous amount of rent is deposited into an account established specifically for Carrie. With the establishment of the account she is entitled to receive annual reports on the status of the account.

In the event that Carries moves from public housing she is entitled to receive the full amount in the account minus any money owed to the PHA. She may also withdraw money from the account to pay education costs, to make a down payment towards a home, or to pay any other PHA authorized expense.

For instance, Anna has two children who require child care. If obtaining child care is essential to work activities, she is able to receive reimbursement for childcare she paid. These payments are excluded from income and should not affect her rent.

Q: How do I establish an individual savings account through the PHA and how does it work?

A PHA can choose to offer individual savings accounts to tenants receiving the earned income disregard. If offered by the PHA, paying a higher rent is calculated by including the otherwise excludable earned income. The PHA then deposits the excess rent into the savings account. The excess rent is that portion due because of the earned income which could have been excluded from income.

The PHA is also required to provide the family with an annual report on the account. If the family moves from public housing, the PHA shall pay the tenant any balance in the account, minus amounts owed to the PHA. Tenants may make withdrawals from their individual savings account in order to purchase a home, pay education costs of family members, move out of public or assisted housing, or pay other authorized expenses promoting self-sufficiency.

EXAMPLE: Carrie has been receiving TANF benefits for the last three months. Recently she has become employed at a local store. She is receiving a weekly salary of $125. Normally the amount she is earning would be excluded from her income due to the earned income disregard. This is because 1) she began receiving TANF benefits within the last six months and she has now become recently employed , and 2) she has not been sanctioned by the local Department of Family and Children Services (DFCS) Office. However, Carries's PHA has presented her with the option of establishing an individual savings account.

As a result of Carrie choosing to establish the individual savings account. The amount of rent she would pay would increase due to the amount of increased income, however, the amount over the previous amount of rent is deposited into an account established specifically for Carrie. With the establishment of the account she is entitled to receive annual reports on the status of the account.

In the event that Carrie moves from public housing she is entitled to receive the full amount in the account minus any money owed to the PHA. She may also withdraw money from the account to pay education costs, to make a down payment towards a home, or to pay any other PHA authorized expense.

Susan Reif
Georgia Legal Services Program
Last Revised: December 2003

Last Review and Update: Jun 17, 2002