Expanding Foundations Income

Goal and Objectives Goal: Participants will accurately evaluate income for Adult Financial customers Objectives: Determine whether income is earned, unearned and in-kind and where to enter each of those types into CBMS Recall what types of income are exempt for Adult Financial programs and how long the exemption lasts Identify when to refer customers to SSA to apply for Title II or Title XVI benefits Calculate income disregards and identify when and how to use them for each Adult Financial program Determine ISM amounts and complete data entry of ISMs into CBMS Calculate income deeming for non-recipient spouses

The Basics In order to receive Adult Financial, the customer must have income below the program’s income limit (grant standard) at initial application Total countable income is deducted from the grant amount to determine the actual grant payment Some income is countable; some is exempt Certain disregards, or deductions, are applied

The Basics All income is countable in the month it is received or legally becomes available Some exceptions apply Four types of income are considered: Earned In-kind Earned Unearned In-kind Unearned

Potential Income “Potential Income” means a benefit or payment the customer, spouse of a customer or sponsor(s) of a customer may be entitled to and could secure

Customers must try to get all of the income available to them Reasonable Effort Customers must try to get all of the income available to them If the customer fails/refuses to get their available income, it will be counted unless there is good cause If the customer cannot show good cause, and the amount of available income cannot be determined, the case should be terminated or denied

Definition “Earned Income” means payment in cash or in-kind received by a customer or spouse of a customer for services performed as an employee or as a result of the customer or spouse being engaged in Self-Employment

Earned Income

Self-Employment Profit-making activities: Money from sales of self-employment capital goods, services, and property

Self-Employment Deduct the cost of doing business: Business expenses (rent for business premises, wholesale cost of merchandise, utilities, interest, taxes, labor, upkeep of equipment, etc.) Do Not include depreciation of equipment, cost of or payment on principal of loans for capital assets or durable goods, or personal expenses

Self-Employment Special Cases: Farm income Rental income customer must actively manage property at least 20 hours per week for it to be considered self-employment Room and Board Licensed child care providers Speak to a lead worker or supervisor if you encounter one of these situations

Donated Work Hours These are considered countable earned income when all of the following apply: Regular and scheduled More than 5 hours/week Is a necessary service Would require a staff member to be hired if not completed by the customer

Value is calculated by taking the greater of: Donated Work Hours Value is calculated by taking the greater of: The going rate in the community for the same type or similar work, OR The current minimum wage

Volunteerism Volunteer work for the betterment of the community that averages less than 30 hours per week is not considered as income

Income Quiz Game! Q & A

Unearned Income Monetary benefits that are not earned SSA benefits (SSDI, SSI, Survivor’s, and SSA Retirement) Pension and retirement funds Veteran’s compensation and military retirement pension

Unearned Income Unemployment compensation Worker’s compensation payments Interest and dividends Gifts and Prizes Oil or mineral royalties or lease bonuses

Unearned Income Rental income Trusts Union strike benefits Railroad retirement payments

Exempt Income The following types of income are not countable for Adult Financial: Income tax refunds Home energy assistance Emergency or general assistance VA Aid and Attendance used for medical expenses

Exempt Income Educational grants and loans Work study income that is need-based Wages received by customers who are at least 55 years old under the SCSEP Reverse mortgage loan payments

INCOME SCRAMBLE!

Disregards Only apply to OAP and AND-CS customers Will not be applied if the customer’s total countable income equals or exceeds the grant standard at application Will decrease the customer’s countable income when calculating the grant amount Are applied to both earned and unearned income

Disregards Countable earned income: Gross earned income $65 2 Total

Disregards Countable Unearned Income: Gross unearned income other than SSI $20 Total countable unearned incone Countable Unearned Income:

Counting Customer Income AND-SO income is counted differently than other Adult Financial programs Earned and unearned income is counted dollar for dollar with NO disregards for the customer

What is an ISM? ISM stands for In-Kind Support and Maintenance It is considered in-kind earned or unearned income to customers ISMs can occur when a customer is NOT paying his or her fair share of housing costs There is a value to the free part of the shelter the customer is receiving It may be considered in-kind unearned income to the customer for Adult Financial

ISM In-kind Support Maintenance Customers receiving SSI and being charged an ISM by the Social Security Administration (SSA) shall be charged a matching ISM for Adult Financial If the customer is paying their fair share of shelter costs, refer them back to SSA. When SSA removes all or part of their ISM, remove all or part of the ISM in CBMS

How Much is an ISM? The maximum amount of an Adult Financial ISM is determined by taking the current SSI grant standard and multiplying it by 33.33%, and then adding $20. That sum is rounded to the nearest whole dollar For 2018, the maximum ISM is $270.00

ISM Calculation $750 .3333 $249.97 $20 $269.97 $269.97 $270

ISM Provisions Do Not Apply to Persons Who are living in and own their primary residence  Who receive subsidized housing Who are homeless Who are paying their fair share of shelter costs which are market value or greater, even if the fair share is less than the current maximum ISM amount Who are paying shelter costs in an amount equal to or greater than the current maximum ISM amount whether or not the costs are fair share or fair market value

Fair Share and Fair Market Value Fair share is determined by totaling the rent and utility costs for the residence and dividing it by the number of people living in the household (including children)

Fair Share and Fair Market Value Market value is the amount the landlord or property manager would charge to rent the residence on the open market This amount is necessary to calculate fair share You may need to talk to the landlord to determine fair market value

Verification of Fair Share Verification of shelter costs is required when determining Fair Share. Collateral Contacts Rent Receipts Leases/Landlord Statement Third Party Source (internet) Don’t forget utilities Phone expenses are not considered in determining fair share

Verification of Shelter Expenses If a customer reports paying shelter costs but doesn’t provide verification, CBMS will generate an information VCL. Customer will have 10 + 1 days to provide verification of shelter costs This VCL will not pend the case or deny automatically if verification is not received

If Verification is not Received If a customer fails to provide verification of shelter costs the full ISM amount should be applied. The full ISM amount would be entered as of the 1st day of the month following the VCL due date. If verification is later provided, it should be treated as a reported change.

Apply the Full ISM When… The customer is NOT paying any shelter costs and all shelter costs are supplied in full. The customer receives an educational loan or grant that provides shelter in full. The customer fails to provide verification of their declared shelter expenses.

Determining an ISM Amount Step One:

Determining an ISM Amount Step Two:

Determining an ISM Amount Step Three:

Switching AND-SO to AND-CS Exercise to see how ISMs count in Wrap Up In most cases SSI will interface This is for training purposes only

Deemed Income The income of spouses and non-citizen sponsors is countable towards the applicant. We call this type of income “deemed” Exception: If the spouse is on ANY KIND of Financial Assistance from the Department of Human Services or is on Medicaid, their income DOES NOT COUNT

Deeming of Spousal Income The deeming of income from the Non-Recipient Spouse varies between Adult Financial Programs AND-SO AND-CS OAP

Information to Gather Spouse’s income from all sources For OAP, get verification of: Income of any dependent children in the home Medical expenses

Deeming of Spousal Income OAP 1: On Medicaid or Cash Assistance? 2: Earned and Unearned Income 3: Verify Income of Dependent Children 4: Verify Medical Expenses