In determining if a family qualifies for a hardship exception to the incremental rent transition (IRT) requirement, should the PHA consider food stamps as gross income? Should the PHA use the definition of Annual Income at 24 CFR part 5.609 and add all of the normally excluded provisions at 5.609(c) to the list of inclusions?
No, food stamps are not considered to be part of the family's gross income for purposes of determining if the family qualifies for the IRT hardship exception. The PHA should not refer to 24 CFR part 5.609 when determining gross income for purposes of the IRT exception. 24 CFR part 5 does not apply to the DHAP.
For purposes of the DHAP IRT hardship exception, if there is any doubt whether a particular financial resource of the family constitutes gross income, the key question for the PHA to answer is:
May part or all of the family resource (i.e., the dollars associated with resource) be used by the family to pay for rent?If the answer to the question is yes, then the resource would be considered part of the family's gross income. If the answer is no, then the resource would not be included in gross income. For example, food stamps may not be used by the family to pay the rent. Therefore the value of food stamps received by the family would not be considered part of the family's gross income for purposes of this exercise. In addition, any income of a live-in aide is not considered a family resource and is not included as part of the participant family's gross income.
Common examples of family resources that would be considered gross income for purposes of the IRT hardship exception include but are not limited to:
A) Wages and salaries (including overtime pay, commissions, etc.) before any payroll deductions for all DHAP family members (but not for any live-in aide);
B) Net income from operation of a business;
C) Interest, dividends, and other net income of any kind from real or personal property;
D) Unemployment and disability compensation, worker's compensation, severance pay;
E) Periodic payments received from sources such as Social Security, annuities, insurance policies, retirement funds, pensions, disability and death benefits, etc.;
F) Alimony and child support payments received by the family;
G) Welfare assistance (unless such assistance is restricted for a specific purpose or purposes that does not include housing such as food stamps);
H) Lump sum additions to family assets (such as capital gains, inheritances, insurance payments);
I) Refunds or rebates under State or local law for property or income taxes; and
J) Regular on-going cash contributions (including gifts) received from organizations or from persons not residing in the unit.
Question #2In determining gross income for purposes of the IRT hardship exception, would the PHA take temporary, sporadic or non-recurring income into consideration?
When the family requests the IRT hardship exception, the PHA would count any temporary, sporadic or non-recurring income as gross income, factoring in the temporary, sporadic or non-recurring nature of the income. For example, a one-time payment received by the family (e.g., family member was hired to distribute flyers for three days and received $100 in compensation) would be divided by 12 for purposes of determining monthly gross income.
For any temporary, sporadic, or non-recurring income received by the family after the IRT hardship exception is granted, the PHA may establish a minimum amount that must be received by the family in order to trigger a recalculation of the family's gross monthly income for purposes of continued family eligibility for the IRT hardship exception.