Revised August 1, 2024

Purpose:

This section includes cash assistance, medical assistance, and Basic Food rules and procedures for allocating the income of ineligible or non-assistance unit (AU) members to an AU, allocating the income of AU members to non-members (for cash assistance we refer to this as the allocated household income disregard), and deeming a sponsor's income to AUs with a sponsored immigrant.

WAC 388-450-0095 Allocating income--General.

• Clarifying Information and Worker Responsibilities

WAC 388-450-0100 Allocating income--Definitions.

WAC 388-450-0105 Allocating the income of a financially responsible person included in the assistance unit.

• Clarifying Information

WAC 388-450-0106 How does the department count my income if someone in my family cannot get assistance because of their immigrant status?

• Clarifying Information

WAC 388-450-0112 Does the department allocate the income of an ABD cash client to legal dependents?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0113 Does the department allocate income of a housing and essential needs (HEN) referral recipient to legal dependents?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0120 Does the department allocate the income of financially responsible parents to a pregnant or parenting minor?

• Clarifying Information

WAC 388-450-0130 Does the department allocate the income of a nonapplying spouse to a caretaker relative?

• Clarifying information

WAC 388-450-0137 Does the department allocate income of an ineligible spouse to an ABD cash client?

WAC 388-450-0138 Does the department allocate income of an ineligible spouse to a housing and essential needs (HEN) referral recipient?

WAC 388-450-0140 How does the income of an ineligible assistance unit member affect my eligibility and benefits for Basic Food?

• Clarifying Information

WAC 388-450-0145 Income of a person who is not a member of a food assistance unit.

• Clarifying Information and Worker Responsibilities

WAC 388-450-0155 How does being a sponsored immigrant affect my eligibility for cash and food assistance programs?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0156 When am I exempt from deeming?

• Clarifying Information 

WAC 388-450-0160 How does the department decide how much of my sponsor's income to count against my benefits?

• Worker Responsibilities

Due to implementation of the Affordable Care Act - ACA, medical WAC’s and clarifying information can now be found in the Apple Health (Medicaid) Manual.

Clarifying Information - WAC 388-450-0095

1. Unmarried persons are not legally or financially responsible for each other.
2. A stepparent's responsibility for support ceases when death or divorce has terminated the marriage.

Worker Responsibilities -  WAC 388-450-0095

1. Determine if there is income possessed by someone outside the assistance unit that must be allocated to meet the needs of the assistance unit.
2. Determine if there is income possessed by someone included in the assistance unit that must be allocated to meet the needs of someone outside the assistance unit.
3. Refer to the appropriate section listed below for specific allocation rules and worker responsibilities.

Clarifying Information - WAC 388-450-0105

1. See WAC 388-450-0106 for rules about allocating income of members who are excluded because of immigrant status.

Clarifying Information - WAC 388-450-0106

1. If an immigrant was sponsored into the United States, use WAC 388-450-0155, WAC 388-450-0156, and WAC 388-450-0160 to see how much of the sponsor's income we count.

Clarifying Information - WAC 388-450-0112

For treatment of income of a non-applying spouse, see WAC 388-450-0137.

Worker Responsibilities - WAC 388-450-0112

1. To determine an ABD referral client's net countable earned income, apply rules in WAC 388-450-0177.
2. Combine the countable earned income with the countable unearned income.
3. When an ABD referral client is in a medical institution, alcohol or drug treatment center, congregate care facility, or adult family home has income, deduct the payment standard applicable for the nonapplying spouse and legal dependents living in the home.
   
   NOTE:

   This deduction only occurs when a ABD referral client is in a medical institution, alcohol or drug treatment center, congregate care facility, or adult family home.

4. Deduct the lesser of the department's one-person need standard or the actual amount paid for court or administratively ordered support, to meet the needs of each legal dependent not living in the home.
5. Subtract the remaining income from the ABD/HEN referral client's applicable payment standard.

ABD Referral Client in Alternate Living Situation

1. Deduct from the income of an ABD/HEN referral client in a medical institution, alcohol or drug treatment center, congregate care facility, or family home, the appropriate payment standard for the nonapplying spouse and legal dependents living in the home.
2. Deduct from the remaining income of the previous step the amount that meets the needs of the ABD/HEN referral client living in the alternate living situation.
3. The remainder is applied to the client's participation toward cost of care.

Clarifying Information - WAC 388-450-0112

For treatment of income of a non-applying spouse, see WAC 388-450-0137.

Worker Responsibilities - WAC 388-450-0113

1. To determine a HEN Referral client's net countable earned income, apply rules in WAC 388-450-0178.
2. Combine the countable earned income with the countable unearned income.
3. When an HEN Referral client is in a medical institution, alcohol or drug treatment center, congregate care facility, or adult family home has income, deduct the HEN Referral income limit applicable for the non-applying spouse and legal dependents living in the home.

      4. Deduct the lesser of the department's one-person need standard or the actual amount paid for court or administratively ordered support, to meet the needs of each legal dependent not living in the home.

      5. Compare the remaining income to the HEN referral client's applicable income limit.

HEN Referral Client in Alternate Living Situation

1. Deduct from the income of a HEN referral client in a medical institution, alcohol or drug treatment center, congregate care facility, or family home, the appropriate HEN Referral income limit for the non-applying spouse and legal dependents living in the home.
2. Deduct from the remaining income of the previous step the amount that meets the needs of the HEN referral client living in the alternate living situation.
3. The remainder is applied to the client's participation toward cost of care.

Clarifying Information - WAC 388-450-0120

For situations involving a pregnant minor or minor parent living with his or her parent, the mandatory assistance unit requirement is not affected by marriage, military service or court-ordered emancipation of the pregnant minor or minor parent; see WAC 388-408-0015.

Worker Responsibilities - WAC 388-450-0120

1. Deduct a $90 work expense from each parent or stepparent's gross earned income.
2. Combine the net countable earned income for each parent with the parent and stepparent's gross countable unearned income.
3. Deduct the appropriate need standard for an assistance unit which contains the non-applying parent and stepparent and any other individuals who:
   1. Are living in the home who is not excluded from the assistance unit due to disqualification; and
   2. Are legal dependents of the non-applying parent or stepparent.
4. Deduct the lesser of the department's one-person need standard or the actual amount paid for court or administratively ordered support, to meet the need of each legal dependent not living in the home.
5. Deduct spousal maintenance payments made to meet the needs of individuals not living in the home.
6. The remaining income is available to meet the needs of the pregnant or parenting minor and children of the parenting minor.
7. Subtract the remaining income from the pregnant or parenting minor's appropriate payment standard.

Worker Responsibilities - WAC 388-450-0130

1. When residing together, allocate the income of a nonapplying spouse to meet the needs of the applying spouse who requests inclusion in the assistance unit as a needy caretaker relative of specified degree (e.g., a grandparent applying with a grandchild or an aunt applying with a niece/nephew).

Clarifying Information - WAC 388-450-0140

1. How to count an ineligible AU member's income and resources
   
   NOTE:

   If a client is ineligible under conditions in both (a.) and (b.), count their income and / or resources at the full amount (a.), not the prorated amount (b.).

   1. Count all the income and resources for ineligible members disqualified for:
      
      1. An Intentional Program Violation (IPV);
      2. Failing to comply with a work program under chapter 388-444 WAC;
      3. Fleeing a felony charge or conviction; or
      4. Violating a condition of probation or parole.
   2. Count a prorated share of the income and all of the resources for AU members who are ineligible because they:
      
      1. Are ineligible ABAWDS under WAC 388-444-0030;
      2. Are undocumented immigrants;
      3. Are immigrants who were determined ineligible under welfare reform;
      4. Failed to declare their citizenship or immigrant status on the application
      5. Failed to sign the application; or
      6. Refused to get or provide a Social Security number.
   3. Disregard the ineligible member's income if their student status is the only reason they are ineligible.
2. How an ineligible member affects the SUA:

   We allow the full SUA for the Basic Food AU.

Clarifying Information - WAC 388-450-0145

Non-members are persons in a residence who:

1. Are not related or otherwise required to be part of the assistance unit. See ASSISTANCE UNITS; and
2. Do not purchase and prepare meals together.

Worker Responsibilities - WAC 388-450-0145

1. Income of assistance unit non-members:
   1. Verify the source and amount of the income.
   2. Use the rules in WAC 388-450-0145 to attribute income to the non-member.
   3. Budget the remaining income for the assistance unit.
2. Expenses of assistance unit non-members:
   1. Obtain a statement from the assistance unit that declares how household expenses are shared.
   2. Clearly document that non-members:
      1. Share expenses; or
      2. Make cash payments to the assistance unit for the non-member's share of expenses; or
      3. Make payments to a third party (vendor payments); or
      4. Have no obligation for household expenses.
   3. If shared household expenses cannot be separated:
      1. Divide the total expenses of the residence by the total number of household members including the non-assistance unit member;
      2. Multiply the answer by the number of non-members to determine their prorated share; and
      3. Do not allow the non-member's prorated share as a household expense.
3. Income of an ineligible student for Basic Food: Income received by an ineligible student is not available to an assistance unit as follows:
   1. Earned income of an ineligible student is not available to the other eligible members of the Basic Food AU unless the ineligible student makes it available; and
   2. Income received by the ineligible student on behalf of others is not available to the AU unless the ineligible student makes it available. Such income includes, but is not limited to:
      1. Veterans' Administration (VA) educational benefits; and
      2. Other benefits received where the amount depends on the number of dependents.

Clarifying Information - WAC 388-450-0155

1. An Affidavit of Support is a form completed by the sponsor of a prospective immigrant as evidence that the immigrant is not likely to become a "public charge", i.e. primarily dependent on public assistance.
2. Old affidavits of support: United States Citizenship and Immigration Services (USCIS) previously used an I-134 affidavit of support for people who sponsored a family member. We only deem a sponsor's income to a sponsored immigrant if the sponsor completed the I-864 or I-864A.
3. When the USCIS requires an affidavit of support: The USCIS requires a US citizen to complete an affidavit of support in order to bring a relative into the US as an immigrant. USCIS also requires the affidavit when an immigrant enters the US on an employment-related immigration petition. The USCIS has detailed information on-line about who must have the affidavit at: https://www.uscis.gov/sites/default/files/document/guides/F3en.pdf
4. A sponsor's liability: A sponsor may be responsible to repay benefits the department pays for a sponsored immigrant. The process for this is not set at this time. A sponsor is not liable to repay benefits for a period when:
   1. The sponsor is a member of the sponsored immigrant's AU; or
   2. The sponsored immigrant starts to receive benefits after they become a US citizen or have 40 qualifying quarters of work.
5. When a sponsored AU member withholds sponsor information: Sponsored AU members may choose to withhold information about their sponsor. However, they become ineligible AU members as a result.

Worker Responsibilities - WAC 388-450-0155

1. Check to see if the client is exempt from deeming under WAC 388-450-0156.
2. If the client isn't exempt, help them get the information they need to deem the sponsor's income:
   1. Get as much information as possible about the client's sponsor including name, last known address, phone number; and
   2. Attempt to contact the sponsor and get the information you need; or
   3. If you can't get more current information, use the affidavit of support to decide the sponsor's income and resources. Get a copy of the affidavit from the client, the client's sponsor, USCIS, or the Attorney General.
   4. If you can't get a copy of the affidavit of support, try to get another form of verification. Don't delay benefits if you can verify the information from another source.
3. If the sponsored immigrant is unwilling or unable to provide their sponsor's information, determine eligibility and benefits for the rest of the unsponsored AU members. Don't include the needs of the sponsored immigrant, but include the immigrant's actual income and resources.

Clarifying Information - WAC 388-450-0156

1. SSA qualifying work quarters: SSA decides how much income someone must earn in order to earn a qualifying quarter of work. See WAC 388-424-0008 for information on how to decide if someone has 40 qualifying quarters of work.

   If an immigrant has 40 qualifying quarters of work using the spouse's work quarters, the immigrant keeps the exemption even if the immigrant divorces the spouse at a later date.

2. Children are exempt from deeming for Basic Food: For Basic Food, we do not deem a sponsor's income or resources to children in the sponsored immigrant's household even if the child is a sponsored immigrant or a U.S. citizen. When the child turns age 18, we must deem the sponsor's income unless the child is exempt for some other reason. See example of deeming of sponsor's income under WAC 388-450-0160 when there are exempt children in the sponsored immigrant's household.
3. Deeming is time-limited for state-funded benefits: For state funded benefits, we only deem a sponsor's income to the immigrant for five years from the date the sponsor signed the affidavit of support. For federal benefits, we continue deeming a sponsor's income and resources until the immigrant is exempt from deeming under WAC 388-450-0156.
4. Using in-kind income: We do not deem in-kind income to the client. We add the sponsored immigrant's in-kind and other income outside of ACES and compare against 130% of the FPL to decide if the client is exempt from the deeming process. The United Stated Department of Health and Human Services (HHS) publishes the federal poverty level guidelines.
5. Value of in-kind income: We use the amount someone would normally pay for items or services (the market rate) as the value of free rent, commodities, goods, or services when we look at a client's in-kind income to decide if they are exempt from the deeming process.
6. Alien Emergency Medical: If a non-citizen isn't eligible for other medical benefits, that person may be eligible for AEM. We don't deem a sponsor's income or resources for AEM. See WAC 182-507-0110.
7. Special Immigrants: Immigrants from Iraq or Afghanistan who were granted Special Immigrant status under section 101 (a)(27) of the INA are not required to have a sponsor, and therefore, not subject to deeming rules.
8. Renewing Indigence Exemptions: While indigence exemptions expire at the end of 12 months, they may be renewed for additional 12-month periods if the eligibility criteria are met.
9. Reporting Indigence Exemptions: The requirement to report indigence exemptions to the U.S. Attorney General described in WAC 388-450-0156 (7) applies only to recipients of federal benefits and is only done after giving them the opportunity to opt out and decline the exemption. Sponsored immigrants must be told the consequences of opting out of the deeming exemption to avoid indigence reporting. Although recipients of state benefits are also eligible for the exemption, they will not be reported. See Worker Responsibilities #5 for instructions.
10. Sponsored Immigrants Prior to 12/19/97: For the purpose of income deeming, a sponsored immigrant is defined as an immigrant for whom a person (the sponsor) has signed an affidavit of support (Form I-864 or I-864A) on behalf of the immigrant pursuant to section 213A of the INA. These forms were not used prior to 12/19/97, so legal permanent residents with this status on or prior to 12/19/97 are exempt from deeming.

Worker Responsibilities - WAC 388-450-0156

1. When a sponsor abandons an immigrant:
   1. If the sponsor abandoned the client, look to see if the client meets the exemption for having income at or below 130% of the FPL and explain to the client about the requirement to notify the U.S. Attorney General if they decide to use the indigence exemption.
   2. If the client meets this exemption, the department must notify the U.S. Attorney General only after giving the client the opportunity to opt out and decline the exemption. See Notifying U.S. Attorney General.
2. Deciding if a sponsor is permanently incapacitated:

   Unless it is questionable, accept the client's statement that the sponsor is permanently incapacitated. If you think the sponsor may not be incapacitated, request a note from the sponsor's doctor.

3. When a sponsored immigrant gets long-term care services: See WAC 182-513-1325, WAC 182-513-1340, and WAC 182-513-1350 for information on how to treat income and resources for a client who gets long-term care services.
4. Deciding if the AU has more than 130% of FPL:
   1. Start with the AU's earned and unearned income;
   2. Add any cash or in-kind benefits the client receives from any source.
   3. The result is the client's total cash and in-kind income.
   4. Multiply the current FPL based on the client's AU size by 1.3.
   5. Compare the total cash and in-kind income to 130% of FPL.
   6. If the client's total income is at or below 130% of FPL, exempt the client from deeming for 12 months. See Notifying the U.S. Attorney General.

   EXAMPLE:

   A sponsored-immigrant family of four applies for benefits. The family gets $300 a month from their sponsor and stays in an apartment furnished by the sponsor's church. The apartment has been rented for $500 a month. The husband earns $2,000 a month and the wife earns $400 monthly.

    

    

   • $2,000 (Husbands income) + $400 (Wife's income) + $300 (Monthly income from sponsor) + $500 (In-kind income - free rent from church) = $3,200 Total cash and in-kind income

   • $2,600 (FPL for a family of four) X 1.3 (130%) = $3,380 (130% of FPL to decide on exemption)

    

   In this example, the client's cash and in-kind income of $3,200 is less than $3,380. The client is exempt from the deeming process for twelve months. This exemption can be renewed if the client's income remains at or under 130% of the monthly FPL.

   The client is not exempt from the deeming process if their cash and in-kind income are more than 130% of the FPL. Calculate how much of the sponsor's income to deem under WAC 388-450-0160.

   NOTE:

   A client is not automatically eligible for benefits by being exempt from deeming.

5. Notifying the U.S. Attorney General:
   1. When you approve federal benefits for a client who is exempt from deeming for having income at or below 130% of the FPL, CSD headquarters staff must notify the U.S. Attorney General (USAG). Before you communicate with CSD headquarters staff, explain to the client:
      1. the purpose of the 130% FPL household income determination;
      2. that they have the right to "opt out" of the deeming exemption; and
      3. that the consequence of not giving their consent to the USAG notification is the department counting a part of their sponsor(s)' income toward the budget used to decide their eligibility and benefit level.
   2. If the client gives their consent to the USAG notification take the following steps:
      1. Complete the Indigence Exemption report form in Barcode (under Forms in the client's ECR) adding the following information:
         • Name(s) of the sponsored immigrant(s) who have been approved for federal benefits and their Client ID numbers;
         • Name of sponsor; if there is more than one sponsor, it is only necessary to enter the primary sponsor
         • Which federal programs the immigrant is eligible for and start date of each.
      2. Submit the report to CSD headquarters staff via Barcode
      3. Document in ACES narration that the client is exempt from deeming and that you referred the case to CSD headquarters staff to notify the USAG.
      4. Set a user-generated tickler in Barcode for an Indigence Exemption Review with a ready date of 12 months from date of exemption.

Worker Responsibilities - WAC 388-450-0160

Calculate the amount of income to deem for cash assistance or Basic Food as follows:

1. Total the sponsor's countable earned income (and the earned income of the spouse if appropriate). Subtract 20% from this amount.
2. Total the sponsor's countable unearned income (and the unearned income of the spouse if appropriate) and add this to the result above.
   • For cash assistance: Subtract the need standard based on the number of people in the sponsor's AU (WAC 388-478-0015 );
   • For Basic Food: Subtract the maximum gross monthly income based on the number of people in the sponsor's AU (WAC 388-478-0060 );
3. If the sponsor completed an I-864 or I-864A for more than one person:
   • For Basic Food, divide the countable income by the number of immigrants that are sponsored by the sponsor and any U.S. citizen children in the immigrant's household under the age of 18;
   • For cash, divide the countable income by the number of immigrants that are sponsored by the sponsor;
   • Multiply by the number of non-exempt immigrants they sponsored that are in this AU.
4. Document the calculation you just completed.

ACES Procedures

• See Interview - (DEEM) Allocations / Deeming Screen
• See Income Eligibility and Budgeting - Special Income Situations - Income Allocation Cash - Financially Responsible Person Not Included in AU Because of Immigrant Status

Top of Page

Revised March 25, 2011

Purpose:

Revised March 25, 2011

Purpose:

Revised November 26, 2019

Purpose:

This section contains cash, medical and Basic Food rules and procedures for budgeting income.

WAC 388-450-0215 How does the department estimate my assistance unit's income to determine my eligibility and benefits?

WAC 388-450-0225 How are my assistance unit's benefits calculated for the first month I am eligible for cash assistance?

WAC 388-450-0230 What income does the department count in the month I apply for Basic Food when my assistance unit is destitute?

WAC 388-450-0162 for the definition of countable income and its effect on eligibility.

Worker Responsibilities and Clarifying Information using above WACS. 

WAC 388-450-0245 When are my benefits suspended?

• Clarifying Information

Worker Responsibilities 

The following topics are discussed below:

• Recording Hours of Employment
• Best Estimate
• Averaging
• When AM Must Be Used to Budget Income
• Month of Application
• Client Choice
• Special Circumstances for Budgeting Income and Expenses
• Budgeting Income for Medical Programs
• Budgeting Deductions
• Effect of Incorrect Estimates
• Determining the Effective Date When a Client's Income Causes Them to be Ineligible

Recording Hours of Employment

For WorkFirst, Working Family Support (WFS), and Able-Bodied Adults Without Dependents (ABAWD) cases, we must verify and record the anticipated hours that a person will be working in the same manner that we budget anticipated income. We use ACES 3G (not eJAS) data to claim employment hours towards meeting the federal TANF work participation rate, to help determine who qualifies for WFS, and for ABAWD Basic Food eligibility.

Treat in-kind income, such as working in lieu of paying some or all of one's rent, as employment, verify the hours and enter the hours into ACES 3G. See separate instructions below for how to code self-employment (SE) hours.

ACES 3G automatically records and reports employment hours from the ongoing month forward. See the following links for information about how to record and report employment hours in historical months from the employment start date.

• Regular employment - WorkFirst Handbook section 8.1.4
• Community Jobs - WorkFirst Handbook section 8.3.12

Note:  Community Jobs pays the state or local minimum wage, whichever is higher.

For employed WorkFirst, WFS, or ABAWD, we record:

• The best estimate of the actual hours we expect the person to work each month when we budget their anticipated income using the Anticipate Monthly (AM) method; or
• An average monthly amount of hours using the Combined Average (CA) budgeting method and the person’s pay frequency; and
• The actual date the person’s work began, particularly for new jobs.

For self-employment, ACES 3G uses SE data to calculate the average weekly hours of SE and display that information in eJAS.

• ACES 3G applies the 50% SE expense standard deduction or use the participant's allowable, verified business expenses, as appropriate, to determine the amount of the cash grant without any action on your part. Only enter verified business expenses on the ACES 3G EARN screen. ACES treats all SE earned income expense types as actual business expenses.
• Self-employment formula to calculate federally countable PT or FT participation hours:

1. ACES 3G subtracts the participant's allowable, verified business expenses or the 50% SE expense standard deduction, whichever is greater, from her or his gross monthly business receipts.
2. Divide the result by the federal minimum wage ($7.25/hour).
3. The result is the number of self-employment hours per month.
4. Divide the number of hours per month by 4.33.
5. The result is the number of hours per week.

Steps to arrive at the best estimate of the client's income

1. During the interview process, identify all sources of earned and unearned income that are:
   1.  Owned by the client; and
   2. Available to the client.
2. Subtract any income excluded or disregarded; and
3. Budget the income remaining using the appropriate calculation method based on the client's choice or the requirements of WAC 388-450-0215.

How to determine the best estimate of a client's income and hours

The best estimate of a client's income and hours is:

1. What hours you can reasonably expect a client to work (including overtime hours); and
2. What income is reasonably expected to be received for the pay period frequency?

Averaging

Use the Combined Average (CA) method in ACES 3G to calculate income when clients expect their income to change from month to month, but want their benefits to stay the same. The income we budget and hours we estimate will depend on the frequency that the person is paid.

It may be appropriate to use past wage stubs to do the averaging if it represents what the client expects to receive. In certain situations, such as new employment or recent changes in the client's rate of pay or work hours, it may be more appropriate to use an estimate from the employer.

1. Estimate the income and hours per pay period as follows:
   1. If using wage stubs:
      1. Total the gross income from all pay periods where the income represents what the client should receive; and
      2. Divide by the number of pay periods used in step (i).
   2. If using an employer statement, take the anticipated weekly amount and:
      1. Multiply by 1 if paid weekly.
      2. Multiply by 2 if paid biweekly (every other week).
      3. Multiply by 52 weeks per year and divide by 24 pay periods if paid twice a month.
      4. Multiply by 52 weeks per year and divide by 12 pay periods if paid once a month.
2. Enter the result from step (1)(a) or (1)(b) on the EARN screen in ACES 3G using the CA method and the appropriate pay frequency.
   1. To get the monthly amount, ACES 3G will take the amount from step (1)(a) or (1)(b) and:
      1. Multiply by 4.3 if paid weekly.
      2. Multiply by 2.15 if paid biweekly (every other week).
      3. Multiply by 2 if paid twice a month.
      4. Multiply by 1 if paid monthly.

To find information on entering income and work hours in ACES 3G, see Income Eligibility and Budgeting – (EARN) Earned Income Screen

When AM Must Be Used to Budget Income

1. For Basic Food only, if an AU is destitute under WAC 388-406-0021:
   1. Use AM for the month of application. If you do not have to use AM for any other reason, you may use either AM or averaging for the remainder of the certification period.
   2. Provide expedited service if available cash resources are $100 or less under WAC 388-406-0015.
   3. See WAC 388-450-0230 to determine if we exclude any of the AUs income for the month of application.
2. AM and SSI-related medical:
   1. Use AM to budget all of the client’s income if:
      1. A client receives SSI-related medical; or
      2. The AU has income allocated to someone receiving SSI-related medical. The following program codes in ACES 3G require AM:
         

         G	G03, G95, G99
         L	L01, L02, L04, L21, L22, L95, L99
         S	S01, S02, S03, S04, S05, S07, S08, S95, S99

3. For clients in the same Basic Food AU with someone receiving SSI, you don't have to use AM to budget the income of the client who doesn't:
   1. Receive SSI-related medical;
   2. Have income allocated to someone receiving SSI-related medical; or
   3. Meet any of the other requirements to use AM under WAC 388-450-0215.

    4. When clients get SSI, but no one in the AU gets SSI-related medical:

Budget SSI and Social Security income using AM. If there is no other situation that requires us to use AM, use either method for the other sources of income.

Month of Application

1. AM method is not required
   1. With the exception of those in subsection (5) of WAC 388-450-0215, you do not have to obtain or budget actual income the household has already received in the month of application if you have enough information to reasonably estimate the client's income by averaging.
2. Conversion of Income
   1. If a client is paid weekly or biweekly and you convert the income using 2.15 or 4.3 method, you must also convert in the month of application, unless:
      1. A full months' income is not anticipated in the month of application. In this situation, budget AM in the month of application and average the income for the rest of the certification period.
      2. The client chooses to use the AM method. If we use AM in the month of application, we must also use it for the rest of the months in the certification period. See Client Choice for more information.

Client Choice

1. If you don't have to use AM, clients can choose either budgeting method unless the client is paid less often than monthly, such as quarterly or yearly. In this situation, we must average the income.
2. If a client has more than one source of income, the budgeting method for each source does not have to be the same. For example, if a client has two different jobs, you can use AM for one job and CA for the other.
3. The client's choice should be guided by whether:
   1. They want their benefits to remain consistent through the certification period; or
   2. They want their benefits to change based on anticipated changes in income and hours.
4. Sometimes the client's circumstances make AM a likely choice, such as when they:
   1. Have stable income such as a regular monthly salary;
   2. Are paid daily;
   3. Expect several changes at different times within the month (e.g. regular hours for the first week, no hours for the second week due to unpaid leave, raise in wages on the third week); or
   4. Expect to get less than a full month's income due to the beginning or end of a source of income.
5. There are times when one method will be more beneficial to the client. If a client is ineligible using one method, review the case to see if the client would prefer another method.
6. Calculation methods cannot be changed during a certification period just to maximize a client's benefits. Changing calculation methods to give a client more benefits does not result in the best estimate of the client's income and hours for the entire certification period. Changes in methods may occur at:
   1. Application, eligibility review, or recertification; and
   2. During a certification period only when the client reports a change that was not considered in the original estimate.
7. When a client is paid biweekly and chooses AM, we adjust the client's case for anticipated changes through the certification period as follows:
   1. Determine which months the client will receive an extra check;
   2. Set a tickle with enough time to budget the extra check for that month;
   3. Give advance and adequate notice to the client.
8. If a client reports a change in their income and hours, take the following steps:
   1. Determine if the change will last at least a month beyond the date the client reported the change;
   2. If so, re-calculate this source of income.
   3. Document the change and whether or not it is expected to last at least a month beyond the month the change was reported.
   4. Record the actual job start date in ACES 3G. This will allow us to report employment hours for all of the time the client has been working.

Special Circumstances for Budgeting Income and Expenses

1. Self Employment. See:

• Calculating Self Employment Income- For Basic Food Benefits
• Calculating Self Employment Income - For TANF, SFA, PWA, ABD, MCS, and Family Medical
• Calculating Self Employment Income – For Children’s and Pregnancy Medical Programs
• Calculating Self Employment Income – For SSI Related Medical

2. Clients that receive their annual income over a timeframe less than a year under contract:
   1. When a client gets their annual income over a period of less than a year as a part of the client's employment contract, average their annual income and hours over a 12-month period unless the client is:
      1. A migrant or seasonal farmworker; or
      2. Paid on an hourly or piecework basis.
3. Other contract income:
   1. If a client's income that is paid under contract is not the client's annual income (yearly), we average the income over the period of time the contract income covers unless the client is:
      1. A migrant or seasonal farmworker; or
      2. Paid on an hourly or piecework basis.
   2. Examples of employees that may receive their income under contract include:
      1. School Employees;
      2. Bus Drivers;
      3. Farmers; and
      4. Fishers.

4. Budgeting the earned income of a child turning age 18:
   1. Count or exclude the earned income of a child according to WAC 388-450-0070. For cash assistance, consider a client to be a child if they meet the requirements of WAC 388-404-0005.
   2. We use a child’s age on the first day of the month as the child’s age for that month.

5. Budgeting child support that fluctuates :

You can use either AM or CA to budget child support you expect a client to receive. Determine the amount to budget based on what you can reasonably expect knowing the client's current support, what they received in the past, and changes that you anticipated changes. Document your decision.

When you know of a change in child support income, decide if the new amount is something you can expect to continue or if the original estimate was valid.

1. If the support is paid through DCS, you can contact DCS and the client to determine if:
   1. There was a change that would impact your estimate for the monthly support (such as a new support order); or
   2. The change could be explained by some short-term situation such as:
      1. Job changes, with a lag between the start of the job and the start of the payroll deduction for support;
      2. Was making larger payments for a period of time to pay arrears, and is now caught up; or
      3. Was off work for a period of time and DCS was unable to collect support.
2. If the support is not paid through DCS, you can contact the client and request information to help determine why the support changed.

6. Budgeting additional cash assistance payments for Basic Food: If a cash supplement is issued due to a change in income or expenses, do not budget the additional cash against the Basic Food without ten days’ notice.
   1. When issuing a cash and Basic Food supplement due to adding a person to both AUs, include the cash supplement when determining the Basic Food supplementary amount for that month.
7. Budgeting a client's partial Unemployment Compensation:  Refer to ESD's Earnings Deduction Chart to budget anticipated   ongoing unemployment benefits when a client is expected to receive partial unemployment compensation.

See LETTERS for information on timely and adequate notice.

Budgeting Income for Medical Programs

1. Budget the income the client received or expects to receive for the month of application. 
2. Use the income you can reasonably expect the client to receive for the month(s) you authorize medical care.
3. See WAC 388-418-0020 - How the department determines the date a change affects my benefits, and WAC 182-504-0125 - Effect of Changes on Medical, for changes in income after certification.

Budgeting Deductions

1. Budget allowable expenses for the month you expect the client to have the expense using AM budgeting or an offline average. Dependent care expenses can be converted using ACES 3G.
2. See INCOME - Effect on Eligibility and Benefit Level to determine if an expense is allowed as a deduction for cash or Basic Food.
3. Refer to the ACES User Manual for information on entering expenses for deductions.

Effect of Incorrect Estimates

1. When clients receive less income than estimated, do not supplement benefits unless you made an error in calculating the client’s benefits.
2. If a TANF/SFA-eligible assistance unit receives less income than you anticipated, see EMERGENCY ASSISTANCE to determine if this created an emergent need and if the client may be eligible for AREN.

Determining the Effective Date When a Client's Income Causes Them To Be Ineligible

For information regarding changes that cause ineligibility, see WAC 388-418-0020.

See WAC 388-406-0055 for the effective date of eligibility for cash assistance applications.

See WAC 388-450-0162 for the definition of countable income and its effect on eligibility.

Clarifying Information

1. Count only income received between the first of the month and the date of application. Do not count any income from a new source that is anticipated after the date of application.

2. If a client receives money after the date of application, and this money is not from a new source, the client is not destitute under WAC 388-406-0021. In this case, we budget the actual amount the client received from the date of application to the date of the client's interview as well as the income we estimate the client will receive for the remainder of the month.
3. Apply the above procedures at initial application and recertification, but only for the first month of each certification period. At recertification, disregard income from a new source in the first month of the new certification period if income of more than $25 will not be received from this new source by the 10th calendar day after the date of the AU's normal assistance cycle.

Clarifying Information - WAC 388-450-0245 

Some situations that could lead to a suspension of benefits include when:

1. Use AM for a client paid weekly or every-other week and they receive an extra periodic check;
2. Clients get pay from an additional temporary job;
3. Clients get overtime pay;
4. Clients get one-time income such as a bonus on individual performance; and
5. Clients get a quarterly payment from an investment.

ACES 3G Procedures 

• See Income Eligibility and Budgeting – (EARN) Earned Income Screen
• See Interview - EDOC
• See Interview - (UNER) Unearned Income Screen - EXTRA field
• See Change of Circumstances

Revised March 25, 2011

Purpose:

STATE OF WASHINGTON

DEPARTMENT OF SOCIAL AND HEALTH SERVICES

HOW THE PUYALLUP SETTLEMENT AGREEMENT WILL AFFECT YOUR ELIGIBILITY FOR PUBLIC ASSISTANCE

If you receive the annuity fund payment, it will not affect your cash, food, or medical assistance.

• When you receive the payment;
• As long as you keep the payment as cash on hand or in a bank account; or
• If you make a purchase or investment directly with the cash from the payment.

How you use your payment may affect your cash, food, or medical assistance:

• If you use the annuity fund payment to buy an item, and the item increases in value, the increase may affect your eligibility for benefits.
• If you use the annuity fund payment to earn interest from savings, you must report the interest as income. This income may affect your benefits.
• If you use the annuity fund payment to make an investment, and the investment increases in value, the increase may affect your eligibility for benefits.
• If you sell, trade, or give away your purchase, savings, or investment, you must tell your local Community Service Office. The money or goods you get in exchange may affect your eligibility for benefits.

IF YOU HAVE QUESTIONS ABOUT YOUR ELIGIBILITY, PLEASE CONTACT YOUR LOCAL COMMUNITY SERVICE OFFICE.

Revised March 25, 2011

Purpose:

Revised December 31, 2013

Purpose:

This section includes rules and procedures for determining whether a client owns income, if the income is available to a client, and what a client must do to make potential income available.

WAC 388-450-0005 How does the department decide if I own a type of income and if this income is available to meet my needs?

Worker Responsibilities - WAC 388-450-0005

Determine if clients have any potential income available.

1. Making a source of income available:
   1. If someone meets all other eligibility factors, do not delay benefits if they try to make a potential source of income available but isn't able to.
   2. If a client person can't make a source of income available for reasons beyond their control, consider the income as unavailable to the client.
   3. Clients must give proof of how a source of income can be available and when the income will be available. Request verification. Ask for proof that the client has tried to make potential income available. Examples of proof include:
      1. Financial Statements;
      2. Collateral Statements; and
      3. Letter from the person or company that has control of the income.
   4. See VERIFICATION for information on how to ask for proof from clients.
   5. See WAC 388-406-0030  to decide how much time to allow clients to provide the proof.
   6. For medical programs, clients must take all needed steps to get any income (such as annuities, pensions, retirement, and disability benefits) they can receive.
      1. Clients do not have to take steps to get the income if they can show a good reason for not doing so.
      2. Examples of benefits the client must try to make available include:
         1. Veteran’s compensation and pensions;
         2. OASDI benefits;
         3. Railroad retirement benefits; and
         4. Unemployment compensation.
   7. Refer clients to the correct agency to apply for potential income and/or help clients get potential income if they ask for assistance.
2. When the date income is available changes:
   1. Budget the income for the date you expect the client to receive the income.
   2. Set an alert in ACES for the date we expect the client to receive the income to check if the income is available.

7. Community income:
   1. When a husband and wife live together, count the following as community income:
      1. Income in the name of the husband, wife, or both spouses;
      2. Income that the husband, wife, or both spouses have access to;
      3. Income the husband, wife, or both spouses received; and
      4. Earnings of the husband, wife, or both spouses.
   2. Always count community income as available for cash assistance. It doesn't matter if one or both spouses are applying for or receiving benefits. 
8. Separate income:
   1. We count income as separate income when the income:
      1. Was received by either spouse before marriage;
      2. Was received as a result of a gift or inheritance;
      3. Was received from separate property; or
      4. Are the earnings of the husband, wife, or both spouses when the spouses live separate and apart.
   2. Separate income becomes community income when someone puts the income an account with community income.
9. If a client refuses to make income available:
   1. For cash and medical assistance – deny or terminate assistance;
   2. For food assistance - do not deny or terminate assistance.
10. Income source discovered after grant opening:  Determine if the client knew about the source but did not tell us.
    1. a.  If the client knew of the income source and there is an overpayment, follow instructions in BENEFIT ERRORS to determine the client's intent.
    2. b. If the client didn't know about the income source, determine the client's eligibility from the date the client first learned about the income and the income was available to them.
11. Jointly owned bank accounts:
    1. When a client has a joint bank account or is holding funds for someone else, determine if the client and the other person have a written or verbal agreement about the amount of the funds available to the client.
    2. If the client and the other person have an agreement, decide if the client uses more than this amount to meet their current needs. Count the excess as available unearned income and budget it for the assistance unit.
    3. If the client and the other person do not have an agreement, decide if the funds are available to meet the client’s needs:
       1. Get a detailed record of the dates and amounts of money deposited into the account or given to the client to hold for the other person.
       2. Get a detailed record of the types and amounts of payments for the other party.
       3. Consider any amount over the itemized payments for the other party as income available to the client. Budget it as unearned income for the assistance unit.
    4. Review the client’s circumstances at each eligibility review, reapplication, or when they report a change in the joint bank account or the source of funds.

8. Flexible benefits:
   1. Funds offered by an employer to help employees with medical, dependent care, or other expenses are called flexible benefits.
   2. For food assistance, treat the amount of flexible benefits available as a direct cash benefit as income to the assistance unit. If there is no option for a direct cash benefit, do not count the flexible benefits as income to the assistance unit.

9. Trusts and medical eligibility:

For the impact of a trust on medical eligibility see Trusts, Annuities and Life Estates - Section B. - Trusts.

Revised December 18, 2023

Purpose:

This section includes rules and procedures on how to treat special income types.

WAC 388-450-0010 The department takes some or all of your time-loss benefits if you get cash assistance while waiting for your claim to be processed

• Clarifying Information and Worker Responsibilities

WAC 388-450-0035 Educational Benefits

• Clarifying Information and Worker Responsibilities

WAC 388-450-0040 Native American benefits and payments.

• Clarifying Information and Worker Responsibilities

WAC 388-450-0045 How do we count income from employment and training programs?

• Clarifying Information 

WAC 388-450-0050 How does your participation in the community jobs (CJ) program affect your cash assistance and Basic Food benefits?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0055 How does needs-based assistance from other agencies or organizations count against my benefits?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0065 Gifts - Cash and noncash.

• Clarifying Information and Worker Responsibilities

WAC 388-450-0070 How do we count the earned income of a child?

• Clarifying Information and Worker Responsibilities

APPENDIX I: The Effect of the Puyallup Settlement on Your Eligibility for Public Assistance.

APPENDIX II: Indian Agencies Serving Tribes with a Near-Reservation Designation.

APPENDIX III: Indian Agencies Serving Tribes without a Near-Reservation Designation.

Clarifying Information - WAC 388-450-0010

1. Retroactive payments for time-loss benefits are considered lump sums. To find out how to treat these payments, see WAC 388-455-0005. Count only the amount of the lump sum that the client receives. Do not count any amount the department recovers.
2. We do not recover time-loss compensation from clients that receive AREN payments if they don't receive ongoing assistance.

Worker Responsibilities -WAC 388-450-0010

When a Cash or Family Medical Client Has a Pending Time-loss Compensation Claim or Files a Claim with Labor and Industries (L&I)

1. Fill out the Time-Loss Benefits Claim Information form, DSHS 18-255 and forward it to the Office of Financial Recovery (OFR).
2. If the client has additional medical coverage, complete the DSHS 14-194(X), Medical Coverage Information form.
3. Let the client know that when they accept public assistance, DSHS has the right to recover net time-loss compensation.  Also tell them that OFR identifies time-loss compensation and decides how much they owe the department.
4. If a client disagrees with the department recovering time-loss compensation benefits, let the client know they may request a fair hearing.

Clarifying Information - WAC 388-450-0035

1. Title IV education assistance that is excluded regardless of how the money is used or a client's graduate or undergraduate status:

• College Work-Study (CWS) Program (must be Title IV- see note below)
• Direct Loan Demonstration Program
• Family Education Loan Program (FELP)
• HEP / CAMP Programs, special programs for students whose families are engaged in migrant and seasonal farm work
• National Early Intervention Scholarship and Partnership Program
• Pell Grant Program
• Perkins Loan Program
• Presidential Access Scholarships
• PLUS Loan Program
• Robert C. Byrd Honors Scholarship Program
• Special Child Care Services for Disadvantaged College Students
• Stafford Loan Program
• State Need Grant (SNG) Program
• State Student Incentive Grant (SSIG) Program
• Supplemental Education Opportunity Grant (SEOG) Program
• Supplemental Loans for Students (SLS) Program
• TRIO Programs, special programs for students from disadvantaged backgrounds

2. Educational assistance benefits where we exclude just the funds used for attendance costs: 

• Carl D. Perkins Vocational and Applied Technology Education Act, P.L. 101-391
• Bilingual Education - Fellowship Program
• Dwight D. Eisenhower Mathematics and Science Education Program
• Jacob K. Javits Fellowship Program
• Library Career Training Program
• National Science Scholars Program
• Patricia Roberts Harris Fellowship Program
• Paul Douglas Teacher Scholarships
• Ronald E. McNair Post-Baccalaureate Achievement Program
• Other educational assistance, not listed above, in the form of grants, work study, scholarships, or fellowships

3. Bureau of Indian Affairs (BIA) education assistance benefits that are excluded regardless of use:

• BIA Higher Education Grants
• Indian Education - Fellowship for Indian Students

4. Employment or training funds: For information on employment or training funds, see WAC 388-450-0045.
5. TOPS Program at Highline CC: TOPS is a WorkFirst work study program that will fall under WAC 388-450-0035  (3).  If you are participating in WorkFirst work study, that work study income is: Not counted for cash and medical assistance; Counted as earned income for Basic Food. More information about the TOPS program at Highline CC can be found at https://womenswkfirst.highline.edu/

Worker Responsibilities - WAC 388-450-0035

1. Averaging educational assistance over the period of use:

Average educational assistance income over the months the school expects the client to use the money. See Budgeting for more information.

2. Changing from one school term to another:
   
   1. When one school term ends and a new term begins in the same month, count the first day of the next full month as the start of the term.
   2. Do not use costs from one school term to offset the educational assistance a client earns or gets in another term.
3. Educational expenses disregarded as income may reduce a client’s allowable deductions for Basic Food:

If you disregard a client's educational benefits under WAC 388-450-0035  (2), allow only the expenses above the educational benefits you disregarded as an expense for Basic Food.  See WAC 388-450-0185  for information on expenses that can be allowed as a deduction for Basic Food.

See INCOME - Effect of Income on Eligibility and Benefit Level for information on deductions for Basic Food.

4. Student loans:

   Consider student loans that clients must repay as bona fide loans under WAC 388-450-0015.  Do not count student loans as income regardless of whether the student is part-time, full time, a graduate student, or an undergraduate.

5. Work study:

   Count work-study income that is not specifically excluded in WAC 388-450-0035 as earned income using the following steps;

   1. For cash assistance:
      1. Exclude the amount earmarked for educational expenses;
      2. Subtract the difference between the AUs need and payment standard from the remaining income of (i) above; and
      3. Budget the remaining income as earned income to the AU.  Average this income over the period of time the client's award letter states the assistance is for.
   2. For Basic Food:
      1. Exclude the amount earmarked for educational expenses; and
      2. Budget the remaining income as earned income to the AU.  Average this income over the period of time the client's award letter states the assistance is for.
   3. Refer to the ACES manual, Income Eligibility and Budgeting - Special Income Situations - Work Study Income

6.  
   
   EXAMPLE MCS client began school in September and has attendance costs of $600 for the semester of September through December.  The client gets VA educational assistance of $400 a month.
   $1600 VA educational assistance Sept. - Dec. ($400x4)
   - $600 Attendance costs
   $1000 Non-excluded income

   $1000 Non-excluded income
   ÷     4 Months in term
   $250 Monthly unearned income

   Educational assistance for TANF / SFA, RCA, GA and medical programs for children, pregnant women and families:

   1. Look at the student's financial aid award letter to identify the amount and type of educational assistance.
   2. Disregard and exclude educational assistance as allowed under WAC 388-450-0035. 
   3. Subtract the difference between the AU's need and payment standard from the remaining income of [c.] above.  See STANDARDS - Cash Assistance to find the need and payment standards for the AU.
   4. Budget the remaining income as unearned income to the AU.  Average this income over the period of time the client's award letter states the assistance is for.
7. Carl D. Perkins (Perkins Loan Program) educational assistance for TANF / SFA, RCA, GA medical programs for children, pregnant women and families:
   1. Decide if the student is a full-time or half-time student.  The school defines a full-time schedule.  A half-time schedule is at least 1/2 the full-time schedule. 
   2. Subtract attendance costs allowed in subsections (2) (a) and (b) of WAC 388-450-0035 from the student's educational expenses based on the student's full- or half-time status.
   3. Subtract the difference between the AU's need and payment standard from the remaining income of [b.] above.  See STANDARDS - Cash Assistance to find the need and payment standards for the AU.
   4. Budget the remaining income as unearned income to the AU.  Average this income over the period of time the client's award letter states the assistance is for. 
8. Veteran's Administration educational assistance for TANF/SFA, RCA, GA and medical programs for children, pregnant women and families:
   1. Subtract all attendance costs allowed in sub-sections (2) (a) and (b) of WAC 388-450-0035 from the student's educational assistance.  Budget the amount left as unearned income to the AU.  Average this income over the period of time the VA states the assistance is for.
   2. DO NOT deduct the difference between the assistance unit's need standard and payment standard.

Clarifying Information - WAC 388-450-0040

Indian Income, Judgment Funds, Trust Funds, and Lands held in Trust Excluded Under Federal Law

For TANF/SFA, RCA, ABD cash, medical, and Basic Food, if Indian payments or benefits are not specifically excluded under WAC 388-450-0040 or any federal law, the payments are counted as unearned income to the AU.

Worker Responsibilities  - WAC 388-450-0040

TANF/SFA, and Basic Food

1. Review Indian payments to decide if all of the payment is excluded.
2. Follow the instructions for the specific types of Indian payments listed below.
3. Document the source of the payment and how you treated it on the REMARKS screen.

Alaska Native Claims Settlement Act

1. Identify any benefits a client receives from the Alaska Native Claims Settlement Act. The types of benefits issued include:
   1. Cash (including cash dividends on stock received from a Native Corporation);
   2. Shares of stock (including stock issued or distributed by a Native Corporation as a dividend or distribution on stock);
   3. A partnership interest;
   4. Land or an interest in land (including land or an interest in land received from a Native Corporation as a dividend or distribution on stock); and
   5. An interest in a settlement trust.
2. Disregard:
   1. The first $2,000 per calendar year each client receives from this Act; and
   2. Shares of stock, a partnership interest, land, and interest in a settlement trust.
3. Count the following as unearned income:
   1. Cash received above the disregard of $2,000 per individual per calendar year; and
   2. Profit earned from the client's Alaska Native Claims Settlement Act resources (e.g., interest or dividend payments earned from investment of the excluded $2,000).
   3. Budget the income as unearned income to the AU.

Judgment Funds

1. Disregard judgment funds or per capita payments received by a tribal members as follows:
   1. Funds paid as "per capita payments" or judgment payments to members of the tribe; and
   2. Up to $2,000 in income received from individually owned trust or restricted lands.
2. Count as unearned income:
   1. Income above the $2,000 disregard; and.
   2. Per capita payments the client received from another eligible tribal member or as an inheritance.
3. Budget the income as unearned income to the AU.

Colville Tribe Settlement Trust Funds

Disregard:

1. Indian judgment funds or funds held in trust for a tribal member;
2. Interest income accrued while funds are held in trust and
3. Investment income accrued while funds are held in trust.

Puyallup Tribe of Indians Settlement Act

1. Treat payments from the annuity fund established by the Puyallup Tribe of Indians Settlement Act of 1989, (annuity fund payments) made to a Puyallup Tribe member as follows:
   1. Disregard the payment when the annuity fund payment is kept as cash on hand or deposited in a checking or savings account; and
   2. Budget income (i.e., interest) derived from the annuity fund payment as unearned income.
2. When a client reports the annuity fund payment, inform the client about how the annuity fund is treated. Give the client a copy of Appendix I - The Effect of the Puyallup Settlement on Your Eligibility for Public Assistance.
3. Document on the REMARKS screen whether you gave the client the information sheet in person or mailed it to the client.
4. Disregard real or personal property the client bought directly with funds from the annuity fund payment (initial investments). Disregard the amount of the funds invested from the annuity fund payment.
   1. Budget income received from the initial investments as unearned income; and
   2. When the real or personal property bought by the client is not excluded as a resource, count any increase in the initial investment's value as a resource.
      1. At the client's eligibility review, decide if the initial investment has increased in value.
      2. Determine the effect of any increase on the client's resources.
5. Disregard payments to a Puyallup Tribe member from the Puyallup Tribe of Indians Settlement Act trust fund.
6. When clients transfer an initial investment, see TRANSFER OF PROPERTY to decide how the transfer affects the client's eligibility.

Indian Benefits -- Trust Funds

Disregard:

1. Indian trust funds or lands held in trust for a tribal member;
2. Interest income accrued while funds are held in trust; and
3. Investment income accrued while funds are held in trust.

Trust Fund Guardianship

When a client tells you that the BIA superintendent of the tribe controls their trust fund, use the following procedures:

1. Request verification of the status of Indian trust funds (including any amount that is in the client's account). DO NOT determine eligibility until you have the verification; and
2. Refer the client to the superintendent to attempt to make the trust funds above the excluded level available to meet the client's needs.

NOTE: Excluded level means: - The personal property resource limit for the program plus - Amounts held in trust or which were received as the result of per capita judgment funds awarded by the Indian Claims Commission or Court of Claims.

3. Tell the client they must provide us with a written statement from the superintendent telling us:
   • Whether the superintendent is maintaining control of the client's trust funds; and
   • ​Whether trust funds above the excluded level will be available to meet the client's current need.

4. How to count funds above the excluded level:
   Count funds above the excluded level as available to meet needs when:
   • The funds are paid directly to the client; or
   • The superintendent pays the funds to someone else for items that duplicate basic needs.
     Don't count funds above the excluded level as available to meet needs when:
   • The funds are not paid out; or
   • The superintendent pays the funds to someone else for items that do not duplicate items contained in the department's need standard.

5. Budget the available income as unearned income to the AU.
6. Review payments from the trust account at each eligibility review.
7. Request the client to get a written statement from the superintendent to identify all payments and why each payment was made in order to redetermine eligibility.
8. If necessary, write the superintendent to request the needed information. Enclose a Release of Information signed by the client.

Bureau of Indian Affairs (BIA) General Assistance Program

For GAU

1. BIA General Assistance meets "essential needs" of Indians while they wait for a GAU eligibility determination or if they have been denied eligibility for other federal, state, county or local assistance programs.
2. Refer Indian clients who have applied for GAU to the appropriate Indian agency to apply for BIA General Assistance when the client:
   1. Is a member of a United States federally-recognized tribe; and
   2. Lives on an Indian reservation in Washington State; or
   3. Lives in a BIA approved "near-reservation" area for their tribe, (see Appendix II - Indian Agencies Serving Tribes with a Near-Reservation Designation, to find out if a client lives in an approved area); and
   4. Is applying for assistance and has an emergent need; or
   5. Is not eligible for benefits from DSHS.
3. To find out if a client meets the near-reservation designation and what Indian agency serves the tribe:
   1. Use Appendix II - Indian Agencies Serving Tribes with a Near-Reservation Designation, to find out:
      1. If the client is living in a near-reservation designated area; and
      2. Which Indian agency serves the tribe with a near-reservation designation.
   2. For Indian tribes not listed in Appendix II, there are no near-reservation designations. Indians from tribes without a near-reservation designation can get BIA General Assistance only if they live on the reservation. See Appendix III - Indian Agencies Serving Tribes without a Near-Reservation Designation.
4. Indians that aren't native to the local BIA are not eligible for BIA General Assistance when they live in a near-reservation designated area.
5. Have the client complete an Authorization to Release Information, DSHS 14-012(X). Be sure the form is completed to allow the department to provide information to the Indian agency as well as request information from the Indian agency.
6. Usually, BIA General Assistance is issued when an Indian client is determined not eligible for other assistance programs. In an emergency case, a person may qualify for BIA General Assistance while DSHS makes an eligibility determination. Do not deny benefits to a client because BIA General Assistance is available to them.
7. When a client gets BIA General Assistance and is found eligible for GAU, count the BIA General Assistance as assistance from other agencies and organizations. See WAC 388-450-0055.

Clarifying Information - WAC 388-450-0045

1. Job Training Partnership Act (JTPA)

   JTPA ended and was replaced by the Workforce Investment Act (WIA).

2. Job Corps

   Job Corps is funded though Title 1-C of WIA and is treated as described in WAC 388-450-0045 (1).

3. WIA Paid Work Experience

   Paid work experience that is funded by Title 1 of WIA is treated as described in WAC 388-450-0045(1). For Basic Food purposes, this is considered WIA on-the-job training and must be budgeted according to WAC 388-450-0045(1)(i) and (ii).

4. AmeriCorps Income

   The AmeriCorps program is issued under the National and Community Service Trust Act of 1993. We exclude all payments issued under AmeriCorps. Although it sounds similar, the AmeriCorps and AmeriCorps VISTA programs are two different programs and how we treat the income varies between the two programs.

5. VISTA / AmeriCorps VISTA Income

   The Volunteers In Service To America (VISTA) program, commonly known as AmeriCorps VISTA, is issued under title II of the Domestic Volunteer Act of 1973. How we treat this income for Basic Food depends on receipt of cash or food benefits at the point someone joins the VISTA program.

   We exclude VISTA income for all cash and medical programs.

6. How to identify AmeriCorps or AmeriCorps VISTA and know which stipends to count as income:

   AmeriCorps

   AmeriCorps VISTA

    

   • AmeriCorps participants (typically referred to as members) generally begin their term of service in late summer or fall. (August - October), but on occasion may start at other times throughout the year.
   • Full-time AmeriCorps members serve for a period of no less than 9 months and not more than 12 months per term of service.
   • An individual is eligible to serve up to two terms of service in AmeriCorps.
   • Receive funds under the National and Community Services Trust Act of 1993.
   
   • VISTA participants (typically referred to as volunteers) attend a Pre-Service Orientation (PSO) prior to beginning their term of service. Enrollment windows are established by the Corporation for National Service. Enrollment occurs at various times throughout the year.
   • VISTA volunteers serve for 12 months.
   • An individual is eligible to serve up to three terms of service in VISTA.
   • Receive funds under Title I of the Domestic Volunteer Act of 1973.

   How to treat AmeriCorps income: Exclude AmeriCorps income for all programs.

   How to treat AmeriCorps VISTA income: Exclude VISTA income for cash & medical. For Basic Food:

   • If the volunteer received cash or Basic Food benefits at the time they joined the VISTA program, exclude the VISTA income.
   • If the volunteer did not receive cash or Basic Food benefits when they joined the VISTA program, count VISTA payments as earned income.

If someone is not sure whether they are volunteering in a program under AmeriCorps or AmeriCorps VISTA, ask the person for copy of their letter of introduction. The letter will identify the program and should include one of the logos shown in the above table.

Clarifying Information - WAC 388-450-0050 

1. Purpose of Community Jobs:

   The Community Jobs (CJ) program places TANF/SFA parents into subsidized jobs when they did not succeed in job search or when the parent may have barriers to employment. See WAC 388-310-1300 for additional information on CJ.

2. Employer of Record for Community Jobs:

   The Community Jobs Contractor (CJC) is the parent's employer of record, not the worksite where the parent is placed. It is not a change if a the parent moves from one job assignment to another so long as the contractor does not change.

3. Subsidized Income:

   There are two types of Community Jobs where the income is subsidized:

   • The parent is placed in a work assignment (Classic Jobs).
   • The initial placement (up to five months) in a work assignment where the parent is expected to be hired by the placement site (Career Jump). This is the first phase of Career Jump.

   In both cases, the income is earned for TANF/SFA and for Basic Food Assistance.

4. Unsubsidized:

   When the parent moves into the second phase of Career Jump, the placement site officially hires the parent, and the employer then pays the wages. Community Jobs still works with the parent but is not responsible for the wages. This income is earned income for both TANF/SFA and Basic Food Assistance.

Worker Responsibilities - WAC 388-450-0050 

1. Budgeting CJ income:

The start date for income is the month that the parent will actually receive the first paycheck. This first month’s income is not counted towards the TANF grant.

Budget CJ income as stated in WAC 388-450-0050 (2) - (6). See INCOME - Income Budgeting

Note:  Community Jobs pays the state or local minimum wage, whichever is higher.

2. If CJ income alone makes the AU ineligible for TANF/SFA: If there is no other income other than CJ wages and these wages alone put the AU over the maximum earned income limit for TANF/SFA under WAC 388-478-0035, then keep the case in suspense throughout the CJ enrollment period. See "When CJ income puts a case in suspense" below
3. If the AU has income from CJ and another source:
   1. The countable income from the other source alone puts the AU over the appropriate payment standard, terminate cash benefits and end the parent's CJ component; or
   2. The AU would still be eligible without counting the CJ income, then suspend TANF/SFA and continue with the CJ component.
4. When CJ income puts a case in suspense: The Division of Child Support forwards the child support payments to the parent and these payments are budgeted against the Basic Food benefits as unearned income. The support payments are not retained support.
5. If CJ income causes a reduction in the grant but it is not in suspense:
   1. The Division of Child Support will not forward the child support payments.  If the AU's child support exceeds the cash grant for two months without counting the CJ income, ACES automatically closes the case.
   2. At the next 90-day review, review the child support payments and decide if the case should be terminated. See WAC 388-310-1300.

6. The transition from subsidized to unsubsidized “Career Jump” wages”: The Community Jobs contractor (CJC) will inform you when the transition to the employer’s payroll takes place. The income remains earned for Basic Food Assistance in all months.

7. When the CJC reports a change:If the CJC reports a change that affects a client's benefits, follow the change of circumstances rules in WAC 388-418-0020.

Clarifying Information - WAC 388-450-0055

1. Assistance from other agencies and organizations:
   1. Includes cash and in-kind income; and
   2. Can come from public or private agencies or organizations.
2. For cash and medical assistance, we can exclude money given by public or for-profit companies as long as the money is not intended for ongoing living expenses. For Basic Food, we must count any money given by a public or for-profit company.

Worker Responsibilities - WAC 388-450-0055

For cash assistance programs for children, pregnant women, and families

1. Verify the following information:
   1. How much assistance the client receives;
   2. How often the client receives the assistance;
   3. Why the client receives the assistance;
   4. What conditions the client had to meet to receive the assistance; and
   5. What the client must do to continue to receive the assistance.
2. Subtract the following from the gross assistance:
   1. Any amount that is not intended to cover ongoing living expenses; and
   2. Any amount provided under conditions which prevent it from being used for the client's current living expenses (e.g., a damage deposit provided by the Salvation Army for the AU to relocate after a fire); and
   3. The difference between the need standard and payment standard for the AU.
3. Budget any remaining assistance as unearned income for the month.

Clarifying Information - WAC 388-450-0065

1. For Basic Food, the definition of "quarter" for this rule is any consecutive three-months. The quarter does not have to be a calendar quarter.
2. A gift is an item voluntarily given to someone without expecting something in return. Some common examples where someone may receive a gift include birthdays, Christmas, weddings, and graduations.
   1. A cash gift is a gift that is in the form of cash, checks, or a sellable security such as stocks or bond.
   2. A non-cash gift is any gift that is not considered a cash gift. Examples of non-cash gifts include:
      1. Real or personal property (e.g., a home, television, furniture, jewelry, or new furnace); and
      2. Goods or services provided at no charge to the client (e.g., free phone service provided by the telephone company.)

Worker Responsibilities - WAC 388-450-0065

1. Cash gifts for cash assistance and medical programs for children, pregnant women and families:
   1. If more than one person share a cash gift, find out the client's share in the gift by dividing the value of the gift by the number of persons receiving it. If the person giving the gift states that the gift must be divided a specific way, use the method stated by the gift giver.
   2. Disregard the first $30 each person gets in cash gifts for each calendar quarter.
   3. Budget any amount above the $30 disregard as unearned income to the AU.
2. Cash gifts for Basic Food:
   1. If the AU received more than $30.00 as a cash gift, budget the entire amount of the gift as unearned income for the month; or
   2. If the AU received $30.00 or less as a cash gift, disregard the cash gift if any one of these conditions are met:
      1. If the cash gifts to the AU over the current and previous two months total $30.00 or less;
      2. If the cash gifts to the AU over the last month, the current month, and those expected for the next month total $30.00 or less.
   3. If none of the conditions in b. are met, budget the entire amount of the gift as unearned income for the month you expect the client to get the income. If a client doesn't know that they will get a cash gift in time for use to affect the client's benefits, do not budget the gift. See INCOME - Income Budgeting.

1. Non-cash gifts for cash assistance and medical programs for children, pregnant women and families:
   1. Disregard non-cash gifts when:
      1. The gift is a voucher or vendor payment (a payment made for a client by another person to a vendor of goods and services);
      2. The donor states in writing that the gift must be used for a specific purpose;
      3. The gift is within the resource limits for the program the client receives; or
      4. The gift is excluded.
   2. For information on non-cash gifts as resources, see the specific resource type in RESOURCES.

Clarifying Information - WAC 388-450-0070

1. A child’s age on the first day of the month is their age for that month. For example, a child turns 18 on February 6. We consider them as 17 in February and 18 in March.
2. Even though they have children of their own, minor parents are considered children for the purposes of this rule. They can qualify for the earnings exclusion if they meet the other eligibility requirements.
3. A child who meets the age requirements can be attending any type of educational program and have their earnings excluded. This includes vocational training and college courses.
4. The month after the income is received, we count the child’s earnings as a resource even if we did not count them as income. The child’s resources are added to the resources of the entire assistance unit (AU) for that month to determine eligibility for the entire AU. The child’s income can be excluded as a resource if placed in an irrevocable educational trust.

Worker Responsibilities - WAC 388-450-0070

1. Verify income of a minor child.
2. The client can use either the DSHS 14-223, Statement from School, or provide a statement from the school for verification of student status.
3. If the child age 17 or younger is in school for any amount of time, exclude their earnings regardless of the number of hours they work.
4. If the child is over age 17 but under age 21:
   1. Count the earnings for Basic Food and medical programs for families, children, and pregnant women.
   2. For cash assistance, exclude the earnings if the child meets the requirements in WAC 388-404-0005. If the child does not meet these requirements, count the earnings.
5. If the child is not in school, count the earnings.
6. Tell the client they may put the child's income into an irrevocable educational trust for the child.

• If the client wants to set up an irrevocable educational trust for their child, give the client form DSHS 18-555(X), "Irrevocable Educational Trust."

7. Keep a copy of the completed form DSHS 18-555(X) in the case record.

Self Employment see Income - Self Employment

ACES PROCEDURES

• For Work Study income, see Income Eligibility and Budgeting - Special Income Situations - Work Study Income 
• See Interview - EARN screen 
• See Income Eligibility and Budgeting - Special Income Situations - Cash Gifts

Top of Page 

Revised August 1, 2024

Purpose:

WAC 388-450-0080 What is self-employment income?

• Clarifying Information 

WAC 388-450-0085 Does the department count all of my self-employment income to determine if I am eligible for benefits?

• Clarifying Information and Worker Responsibilities

Resources, Desk Aids and Links

• Types of Business Structures (DOR)
• Business and Professional License Search (DOR)
• Monthly Sales and Expense Worksheet (DSHS 07-098)
• Starting a Business and Keeping Records (IRS 583)
• Self Employment Status Decision Tree
• Business Structure Chart

Clarifying Information  - WAC 388-450-0080

Determining Self Employment (SE) Income

1. Child Care​​
   1. Child care providers that are subject to the licensing requirements under chapter 74.15 RCW are self-employed, even if they don't have a current license. Child day-care center operators and family home day-care providers are self-employed.

2. Child care providers, who don't require a license under state law, are not self-employed. We consider unlicensed individual providers as employees of the child(ren)'s parents.

3. ALTSA

The Aging and Long Term Support Administration (ALTSA) and Developmental Disabilities Administration (DDA) pays individual providers to provide personal care to their clients. Individual providers work for the ALTSA/DDA customer and the state. Their hours and wages are set by the state, although the ALTSA/DDA customer may be required to pay the provider directly for a portion of the cost of care. Individual care providers also get benefits and have representation. WAC 388-71-0505 requires individual providers to have an employer-employee relationship with the customer, ALTSA, and DDA. ALTSA and DDA individual providers are employees.

4. Corporations

People who own a corporation are not coded as self-employed. This is true even if the person is the sole investor in the business. Corporations are separate entities from their investors and employees. The person is considered an employee of a corporation, and may also have income from dividends related to any investment in the corporation. Code any income received from the corporation other than wages as unearned income. This includes any payments made by the corporation for personal expenses, for example:

• mortgage payments; 
• car insurance; and 
• household items.

See Treatment of Income for information on budgeting income from dividends and regular earnings.

S Corporations are treated the same as corporations. Limited Liability Companies (LLC) are treated the same as corporations if they are set up as corporate structures. Partnerships are not incorporated, and are considered self-employment enterprises. For more information on various business structures, visit the IRS website.

4. Odd Jobs

Getting money for sporadic or periodic work without a business license or established employer to employee relationship, or "odd jobs", is considered self-employment.

Make every attempt to verify odd job income using available means including collateral contacts. Accept the statement of a client with odd job income as verification of income only after all reasonable attempt to verify the income fail. Provide the client with self-employment verification work sheets, or request that the client find another way of getting acceptable collateral verification of income for their next review.

5. WorkFirst

For more information about how self-employment affects the WorkFirst participation of TANF / SFA clients, see the WorkFirst Handbook, Section 8.2. Self-Employment.

Clarifying Information - WAC 388-450-0085 

1. Determine gross self-employment (SE) income

   To determine gross self-employment income, add together the total sales for all items the business sold and all income from providing services.

2. Always allow the 50% of the gross SE income as the standard deduction for cost of doing business if the person doesn't have actual verified costs for non roomer / boarder SE income. This includes when the person
   1. Claims no SE expenses;
   2. Has SE expenses under 50% of the gross SE income;
      or
   3. When the SE income is treated as unearned. See WAC 388-450-0080(7) for when SE income is treated as unearned income.
   4. Individuals claiming to have SE expenses greater than 50% of the gross SE income must provide proof of these expenses.
3. Transportation costs such as gas, oil, replacing worn items, registration and licensing fees, and auto loans:
   1. The person may claim the actual transportation costs; or
   2. Claim the State standard cost per mile. The Office of Financial Management publishes the standard cost for a privately owned vehicle in section 10.90.20 of the State Administrative and Accounting Manual: https://ofm.wa.gov/sites/default/files/public/legacy/policy/10.90a.pdf
   3. The client must provide detailed mileage records or other documentation showing beginning and ending mileage and destination of each trip to support the expense.
4. If someone chooses to use their actual expenses instead of the standard 50% deduction, they must list out and provide documentation of the expenses within application or recertification processing timeliness "standards of promptness" before we can use them.  If verified expenses are less than the 50% standard deduction, the system will use the standard 50% to calculate benefits.
   
   NOTE:

   The mileage rate as of January 1, 2025 is $0.70 / mile.

5. Business Expenses
   

   Generally, someone may claim any business expense that is allowed by the Internal Revenue Service (IRS), with the exception that we don't allow a deduction for depreciation.

   IRS Topic 509 - Business use of a home - Explains how to calculate business use of a home and that a qualified day care provider must apply the percentage of hours an area is used for business when calculating the allowable home business expenses.

   IRS Publication 463 - Travel, Entertainment, Gift, and Car Expenses - Explains the rules and limits associated with these business deductions. Entertainment expenses are subject to the "directly related" test that specifies the main purpose was to conduct business with an expectation of getting income or other business benefit, and certain other restrictions

   Some examples of allowable business expenses are:

   • Materials used to produce goods
   • Maintenance of business property
   • Space rent
   • Payroll or wages
   • Chemicals, fertilizers, and supplies used to produce goods or services
   • Vehicle expenses for business purposes with documentation
   • Business loans (interest and principle)
   • Business phone
   • Banking fees

   Some examples of line items we don't count as an expense are:

   • Health insurance for you and your family
   • Personal Utilities (no separate meter from home)
   • Personal phone
   • Rent or mortgage of your home
   • Depreciation
   • Vehicle expenses without documentation
   • Guaranteed payments

   Examples of allowable documentation of expenses are:

   • Receipts for expense claimed.
   • Itemized bank statements that correspond to expense claimed.
   • Itemized bank card statements that correspond to expense claimed.
   EXAMPLE

   Bob's Paintland holds an annual holiday party for employees. This is not an allowable business expense because its purpose is to celebrate with employees, not increase customer business.

   EXAMPLE

   Ginny is a real estate agent. She holds open houses every month at the various homes she has listed for sale. She serves food and drinks at the open houses, and even hires musicians on occasion. The expense is allowable because the purpose of the open house is to increase her customer base and sell homes.

 Worker Responsibilities - WAC 388-450-0085

1. Calculating SE income

   Calculate countable SE income by taking all income received from sales or services and subtracting 50% of the total as a business expense unless the client presents proof of expenses for the same period of time greater than the 50% standard.  ACES will calculate the 50% deduction after the worker enters the full SE total income and then ACES subtracts the family earnings disregard and the appropriate earned income disregard (20% for food or 50% for cash).  See ACES Users Manual.

2. Budgeting SE income: When someone earns SE income, average the income over the period the income covers. If they present proof of actual SE expenses above the 50% standard, average their allowable, verified expenses over the same period.
   1. If the person earns their annual income as SE income, and they receive this income over a period of less than a year, average the SE income over the year.
   2. If a person's income is from SE for only part of the year (they have another source of income for the remainder of the year), average the income over the period of time the income covers.
   3. Use income averaging (CA) method to budget SE income for all benefit months including the application month.
      
      NOTE:

      Use income averaging (CA) method for SE income for month of application as under WAC 388-450-0215.

      EXAMPLE:

      Self-employed client applies for Basic Food on April 14. Worker determines income from SE is primary source of household income and calculates average monthly income verified from most current federal tax return which shows gross income from Schedule C for previous year as $16,500. Worker divides this amount by 12 to get average monthly income of $1,375. This amount is used to calculate benefits for month of application and ongoing months. The deduction would be either 50% of the average or verified allowable expenses per WAC 388-450-0085. Benefits for application month are prorated to include April 14-30.

3. Change in SE income 

   If the averaged income doesn't reflect what the person will receive because of a significant increase or decrease in business:

   Anticipate the person's SE income for each month; and

   1. Average any capital gains they will get over the year.
   2. If someone presents proof of their actual expenses greater than the 50% standard, average or anticipate the expenses for the same period of time you use for the income.
4. Calculate each SE business separately: Each SE business is separate.
   1. Calculate the net SE income for each SE enterprise separately.
   2. Don't use the losses of one business to offset the profit of another business.
   3. Don't use the losses of one period to offset the profits of another period.
5. Farming or fishing income for Basic Food
   1. Calculate the client's total net farm or fishing SE income.
   2. If allowable expenses are more than the SE fishing / farming income, ACES uses this loss to reduce any other sources of SE income.
   3. If there are remaining losses from fishing / farming, ACES uses this income to reduce other sources of earned and unearned income to the assistance unit after allowing the earned income deduction under WAC 388-450-0185.
6. Boarder income (room and meals provided)
   

   Count only payments people pay directly to the AU for room and board as income. This does not include foster care payments.

7. Roomer income (home owner or renter who receives income for renting out rooms)
   1. A person may choose to use their entire shelter cost toward their food benefit budget shelter deduction or use a portion to calculate prorated share of the rent, or mortgage, taxes, and insurance if they don't use the entire shelter cost toward the shelter deduction.  Use the 50% standard deduction from roomer income received; or
   2. Allow verified costs directly related to the cost of renting rooms, such as laundry expenses or advertising expenses, even if the entire housing cost is used as a shelter deduction.
   3. To calculate the shelter expense, see the Shared Living / Roomer section of Clarifying Information under WAC 388-450-0190.  Base the proration on the number of total bedrooms in the house.
   4. People that share a residence are not considered to have roomers if they:
      1. Don't charge their roommates an amount above the total rent as shown on the lease; and
      2. Don't own or are not buying the residence.
   NOTE:

   People in the same Assistance Unit who share household costs are not roomers. We do not count these shared household costs as roomer income.

   EXAMPLE:

   Louise is renting her two bedroom townhome for $500 per month. She charges Jolene $650 to sublet her second floor. Louise tells you her actual expenses are $250 based on a prorated portion of her rent of $500 / 2 bedrooms. Louise has $400 in net self-employment income, but with the automatic 50% deduction, her net self-employment income will be counted as $325. Her shelter deduction would be the utility allowance she is eligible for under WAC 388-450-0195 and $250 rent (the portion of her housing costs that wasn't taken as a business expense.)

8. Rental Property:

   Rental property that is subject to the criteria in WAC 388-450-0080 (7) is property that someone owns, but is not their residence.

   1. We count any managerial duties toward the 20-hour weekly requirement for rental property to be treated as self-employment earned income under WAC 388-450-0080. Count time people spend bookkeeping, showing the property to possible tenants, doing yard work, repairs, etc. as time spent managing the property.
   2. Budget the gross earned or unearned income from renting the property after subtracting the standard self-employment deduction or the following verified expense payments:
      1. Property tax or a prorated share of the tax if their home and the rental property are taxed as a single unit;
      2. Maintenance costs for the property;
      3. The mortgage or sales contract payment for the rental property or a prorated share if their property and the rental property are in the same loan or contract; and
      4. The insurance premium, or a prorated share, if they insure their home and rental property as a unit.

ACES Procedures

1. See Income Eligibility and Budgeting - Special Income Situations - Cash Gifts
2. See Interview - EARN screen
3. For Work Study income, see Income Eligibility and Budgeting - Special Income Situations - Work Study Income

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Revised December 28, 2020

Purpose:

This section contains general rules and procedures to decide if a type of income is excluded and disregarded, unearned, or earned.

WAC 388-450-0015  What types of income are not used by the department to figure out my benefits?

WAC 388-450-0025  What is unearned income?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0030 What is earned income?

• Clarifying Information and Worker Responsibilities

Clarifying Information - WAC 388-450-0025 & WAC 388-450-0030 

See also Treatment of Income Chart.

Worker Responsibilities - WAC 388-450-0025 & WAC 388-450-0030

1. Ongoing Assistance from Volunteer Agency (VOLAG)

   Only exclude one-time refugee resettlement payments from VOLAG assistance.

   Some refugees receive ongoing benefits through the Matching Grant Program. Because federal law doesn't specifically exclude these ongoing payments, we must count this as assistance from another agency or organization under WAC 388-450-0055.

2. Adoption support is money given to families that adopt children with special needs and intended to help the family with the special expenses that these children have.
   
   1. For cash,  we exclude this money because it is needs-based assistance from another agency that doesn't cover ongoing living expenses. See WAC 388-450-0055 for more information.
   2. For Basic Food, we must count adoption support as unearned income.

3. Annuity

   For Basic Food and Cash: Count payments and interest received from an annuity as unearned income.

4. Bona fide loans

   Exclude bona fide loans for all programs. If a loan isn't bona fide, count the money someone receives as unearned income for the month they receive it. Determine if a loan is bona fide by getting proof of the loan details. Follow normal income verification processes.

Examples of proof that a loan is bona fide include:

1. When the loan is through a bank, credit union, or other institution that loans money as a part of their business:
   
   1. A copy of the formal loan agreement; or
   2. A written agreement to repay the money within a certain timeframe; and
   3. Proof that the money came from a person or business that loans money.
2. If the money is from a person or business who doesn't normally loan money, proof to show:
   
   1. That the borrower understands they must repay the loan either with or without interest;
   2. The borrower’s intent to repay by promising real property, personal property, or anticipated income; or
   3. A timetable and plan for repayment with details of the plan to repay the loan when the person receives the anticipated income.
3. If there isn't a formal written loan agreement, accept a written or verbal statement from the borrower and the lender about the terms of the loan. Request additional verification if the proof is questionable.

5. Child Support payments:

Budget all anticipated child support payments.  Workers can use SEMS to look at both the Disbursement History (DH) and Case History (CH) screens.  It will also be necessary to review the Case History (CH) screen in SEMS to determine if we can anticipate any arrears payments assigned to the custodial parent (shown in the Arrears (CP) column).

Budgeting For Basic Food: If the assistance unit receives food but not TANF, budget all anticipated child support payments.

• Code any child support arrears payments paid to the CP as “DP” as Unearned Income for the parent
• Code any current child support payment as "DC" as Unearned Income for the child..

Budgeting For TANF:

• During application, code any current child support payments already received in that month as DC. 
• When TANF is approved, don’t anticipate any current child support payments (DC) in ongoing months.  The household won’t receive current support, unless the TANF grant goes into suspense (this happens when the TANF grant is $0). See Income Special Types.
• Code arrears payments made to the custodial parent/caregiver as unearned (DP) for TANF.
• Effective February 1, 2021, code any child support pass-through payments as “CP” on the child’s unearned income screen.

6. Child Support Pass-Through payments: Starting February 1, 2021, each month Division of Child Support (DCS) collects child support, they will send TANF households:

• Up to $50 each month if the TANF AU includes one child, and
• Up to $100 each month if the TANF AU includes two or more children.

This child support sent to the TANF household is called a pass-through payment. The amount of the pass-through payment will not be more than DCS collects during that month.

Pass-through payments do not affect TANF/SFA grants. However, these payments must be budgeted for Basic Food.  Workers can use SEMS to look at both the Disbursement History (DH) and Case History (CH) screens.  If you use the “CP” valid value, this income will be budgeted correctly for Basic Food and exempt for TANF.

7. Court-ordered payments: Count payments, other than child support, made to someone by order of the court as follows 
   
   1. If someone receives the money as a one-time payment, count this as a lump-sum payment.
   2. If they will receive more than one payment, count the payments as unearned income.

8. Dividends and interest

Dividends

Count dividends as unearned income for the month we anticipate people will receive them.

Interest

1. Count interest income as unearned income unless the interest is earned on:
   
   1. Individual Development Accounts under WAC 388-470-0045. Exclude interest earned on IDAs; or
   2. Native American benefits excluded under WAC 388-450-0040. Exclude interest earned on benefits excluded under WAC 388-450-0040.
2. Give people the choice of whether you:
   
   1. Budget the income for the month you anticipate they will receive it; or
   2. Prorate the income over their certification period.
3. If we learn about someone’s unreported interest income and they were required to tell us about it, we count the interest as income for the month they got it.

9. Foster care maintenance payments
   1. For TANF/SFA:
      
      1. Exclude any unlicensed foster care assistance when the placement is temporary for less than 180 days, or
      2. When the child is listed in the AU as a non-recipient with a needy non-parental relative. See WAC 388-408-0025.
   2. For Basic Food:
      
      1. If the AU includes the foster child, count the foster care maintenance payment as unearned income to the AU; or
      2. If the AU doesn't include the foster child, exclude the foster care maintenance payment. See WAC 388-408-0034 & WAC 388-408-0035.

10. Funds for shared household costs

    1. When someone holds money for another person's personal obligation such as a car payment, credit card, or auto insurance, treat the money for the other person's obligations as funds held for the other person.
    2. When someone receives money for another person or family's share of household costs, we exclude this money using the table "When We Exclude Money For Shared Household Costs ".

11. In-kind Income

    1. For cash assistance: When someone works for something of value other than cash, count the value of the item they receive as earned income. People receive earned income in kind when they work in exchange for things like:
       1. Rent;
       2. Furniture;
       3. A car; or
       4. Any other item of value.

2. For Basic Food: Exclude in-kind income unless someone diverts the person’s available income to an in-kind source. If someone diverts income to in-kind source, we count the diverted funds as income to the AU. There is no requirement to verify income-in-kind for Basic Food unless we are counting income diverted to an in-kind source. See Vendor payments below for more information and examples regarding diverted income.

12. Joint Bank Accounts
    1. When someone has a joint bank account or holds funds for someone else, decide how much of the money belongs to them. See Worker Responsibilities of INCOME - Ownership and Availability to decide how much of the money belongs to them.
    2. If the person uses more than their share of the money in the account, count the money the person uses above their share as unearned income to the AU.

13. Military Pay

    1. Count the following allowances as earned income:
       1. Basic allowance for housing (BAH), living off-base;
       2. BAH with on-base housing when BAH is listed under pay then deducted; and
       3. Basic allowance for subsistence (BAS).
    2. Exclude the following allowances or in-kind benefits:
       1. Clothing maintenance allowance (CMA);
       2. Base housing or barracks (with no BAH listed on pay statement);
       3. Meals; and
       4. Reimbursement or an allowance for transportation or moving costs.
    3. Advance pay:
       1. Count advance pay as earned income for the month someone receives the income, unless requested for travel.
       2. If someone asked for advance pay for travel, exclude the amount that is to reimburse actual travel expenses. Count any excess as earned income for the month they will receive it.
    4. Count enlistment and re-enlistment bonuses as earned income for the month the person will receive it.

14. Military Income– Special and incentive pay received while serving in a combat zone.

    For Cash and Basic Food, we exclude additional pay members of the armed forces receive for deployments in a designated combat zone. 

    Military personnel in a combat zone are not members of the assistance unit, but may give income to people in the AU. If an AU receives income from an armed service member serving in a combat zone, decide how much income to budget as described below:

    1. First, determine the amount of money the service member made available to the AU before being deployed to a designated combat zone;
    2. Second, determine the amount of money the service member now makes available to the AU after being deployed to a designated combat zone; and
    3. Last, determine how much of the service person's military pay we must count as income to the AU:
       1. Before deployment to a combat zone: If the amount of military pay the service person makes available to the AU after deployment is equal to or less than before they were deployed to a combat zone, count the income currently made available to the AU as income for cash and food benefits.
       2. After deployment to a combat zone: If the military pay the service person makes available to their family is greater since being deployed to a combat zone , exclude the additional income for cash and food benefits

15. Money received for an absent or non-household member
    1. Exclude income the AU receives for the care and maintenance of an absent or non-household member as long as the AU doesn't keep the income. Examples of income for absent or non-household members include:
       1. CPI payment for a member of a multi-person grant;
       2. Child support the AU receives for a child that is temporarily out of the home or not on the TANF grant;
       3. Child support for an ineligible child;
       4. SSI benefits for a couple when one of the spouses is in a nursing home; and
       5. SSDI paid to a relative as the protective payee.
    2. If the AU keeps a portion of the income, count the portion the AU keeps as unearned income for the month they receive the income and as a resource in the next month.

16. Money withheld for repayment

    If people have money withheld from their benefits to recover an overpayment from the same income source, exclude the amount withheld from their gross benefit. Count the net benefit amount as income to the AU.

    • For Basic Food: If the money is withheld due to an intentional violation of a federal or state means-tested program, count the amount withheld to recover the benefit as unearned income. Count the gross benefit amount as income to the AU. Some means-tested programs include TANF, GA -U, and SSI.

17. Real estate / mortgage sales and contracts
    1. When someone sells real estate that they owe money on under a mortgage or contract, and they carry the contract for the new buyer, count the proceeds from the sale as unearned income for all programs after you subtract any amount paid for:
       1. Insurance;
       2. Property taxes; and
       3. Interest on the prior purchase.
    2. For cash assistance, look at the value of the contract to decide if the AU is eligible for benefits:
       1. If the value of the contract puts the AU over resource limit, the AU is ineligible for benefits.
       2. If the total resources are below the resource limit, the AU is resource eligible for benefits. Count payments from the contract as unearned income.

18. Reimbursements for out-of-pocket expenses

    Exclude money to reimburse a person's past or future out-of-pocket expenses. These payments are not a gain to the household. Examples of some reimbursements we exclude as income are:

    1. Work or training expenses;
    2. Title XX services (such as CHORE services); and
    3. HUD and FMHA utility allowances.
       
       NOTE:

       For health insurance reimbursements, see THIRD PARTY LIABILITY and LUMP SUM PAYMENTS.

19. Sanctions - Impact on Basic Food benefits

    When we sanction an active TANF/SFA or ABD cash case for failure of someone in the assistance unit to meet program requirements, we count the entire grant the AU would receive if they weren't in sanction. This prevents the assistance unit from receiving more Basic Food benefits because of the sanction.  This rule doesn't apply to individuals who fail to perform the required action at the time of application for cash benefits or at time of recertification for the cash benefits.

    If a TANF / SFA or ABD cash case terminates while still in sanction status, we stop budgeting the grant against the Basic Food benefits as they no longer receive public assistance.

20. Vendor or third party payments

    For cash assistance or Basic Food, we exclude:

    1. Support payments made directly to a third party for a household expense when:
       1. There is no court order for support; such as a separated parent paying the house payment of the parent still in the home when there is no court order; or
       2. The payment is more than the court-ordered amount. For example, an absent parent pays $50 over the court-ordered support to the landlord.
    2. Third-party payments as income when a payment:
       1. Is specifically directed to be paid to a third party;
       2. Doesn't pass through the assistance unit's control at any point; and
       3. Isn't otherwise payable to them.

For Medical, the exclusion only applies when the payment is inherent in the cost of obtaining the source of income the payment applies to, regardless of whether or not they make the payment directly.

For Basic Food and cash benefits, count money that is legally obligated and payable to the household but has been diverted to a third-party as income to the AU. Count the diverted payment as:

1. Earned income if the household diverted employment or self-employment income;
2. Unearned income if not earned by employment or self employment.

For Basic Food only, this does not include in-kind income that is not otherwise payable to the household.

21. Bonus or training incentive paid to childcare providers by the Department of Early Learning

    The Department of Early Learning’s collective bargaining agreement with childcare providers includes bonus payments for some providers who receive benefits from the department. We treat these payments as described below:

    $250 Bonus for exempt providers who become licensed family home providers.	Counted as earned income for Cash and Basic Food.
    $600 Financial Incentive for License exempt providers who received at least 10 hours of approved training.
    $200 Bonus for Exempt providers - Reimbursement of up to $200 for tuition costs or approved training.	Excluded.

    NOTE:

    Because we budget prospectively based on the income we expect a household to get for the month, we often won't learn about the bonus soon enough for it to impact benefits for the month the household will receive it.

22. Selling Personal Items

    1. Selling personal property as a necessity to pay living expenses isn't countable income. We would consider these payments as non-recurring lump sum payments. Any money remaining the client has in the following month would be a countable asset.
    2. We consider buying and selling items for a profit, as a regular venture, countable self-employment income if we can reasonably anticipate that this source of income will continue beyond the next 30 days.
    3. We consider selling any item for a profit and receiving regular payments for that item instead of a lump sum payment unearned income as long as the payments continue.

ACES PROCEDURES

See Interview - (EARN) Earned Income Screen

See Income Eligibility and Budgeting

Revised: October 17, 2024

American Rescue Plan Act signed into law March 11, 2021. For Classic Medical see WAC 182-521-0100.

• SUA - Allowed if incurred or expected heating or cooling utility costs by an assistance unit (AU) in the residence.  
• LUA - Allowed for each AU if incurred or expected two utility costs, and do not qualify for SUA.
• TUA - Allowed for each AU that has a separate phone service if this is the only utility bill for an AU.
• ZUA - Used for households that report no utility costs.

Always code ACES with the household’s actual circumstances. Eligibility for SUA through Heat and Eat, or through a contracted agency with Department of Commerce, will be automatically determined once the case is approved.

Heat and Eat:  Clients receiving the Low Income Household Energy Assistance Program (LIHEAP) through the Heat and Eat program, may be allowed SUA in the benefit calculation, even if they are coded as LUA, TUA or ZUA.  AUs meeting the following requirements receive a cash payment of $20.01 annually and qualify for SUA:

• Receive at least $1 in benefits;
• Not receiving the maximum in benefits;
• Not otherwise eligible to receive SUA; and
• Not receiving LIHEAP through another provider during the current federal fiscal year.

Those who receive benefits through the state-funded Food Assistance Program (FAP) can meet the same requirements for Heat and Eat SUA, although they don’t qualify to receive the cash payment.

Revised October 1, 2024

Purpose:

This section contains rules and procedures for determining countable income for cash, medical, and Basic Food.

WAC 182-509-0001 Countable income for Washington apple health programs.

WAC 388-450-0162 How does the department count my income to determine if my assistance unit is eligible and how does the department calculate the amount of my cash and Basic Food benefits?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0165 Gross earned income limit for TANF / SFA.

• Clarifying Information

WAC 388-450-0170 Does the department provide an earned income deduction as an incentive for persons who receive TANF/SFA to work?

• Clarifying Information

WAC 388-450-0177  Does the department offer an income deduction for the ABD cash program as an incentive for clients to work?

WAC 388-450-0185 What income deductions does the department allow when determining if I am eligible for food benefits and the amount of my monthly benefits?

• Clarifying Information

WAC 388-450-0190 How does the department figure my shelter cost income deduction for Basic Food?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0195 Does the department use my utility costs when calculating my Basic Food or WASHCAP benefits?

• Clarifying Information and Worker Responsibilities

WAC 388-450-0200 Will the medical expenses of elderly persons or individuals with disabilities in my assistance unit be used as an income deduction for Basic Food?

• Clarifying Information and Worker Responsibilities

Cost Of Living Adjustment (COLA)

• Clarifying Information

Clarifying Information - WAC 388-450-0162

• Utility Chart

1. We reduce the cash or Basic Food benefit amount by any sanction penalties or overpayment deductions before issuing a benefit.
2. For information on calculations to determine the cash benefit amount for the first month of eligibility, see WAC 388-450-0225.
3. For cash assistance, when an AU contains eight or more people we calculate the benefit level by subtracting the countable income from the appropriate payment standard. The grant payment can't exceed the maximum monthly payment of $1,338.00. See WAC 388-478-0020 for cash assistance payment standards.

How to Calculate Basic Food benefits

Staff must understand how to calculate Basic Food benefits in order to explain how a client's income and circumstances affect their benefits. Use the following procedures to determine an AU's Basic Food benefits.

Gross income:

1. Determine total gross income for all AUs as follows:
   • Include all dollar and cent amounts when calculating;
   • Add all non-excluded earned income from all sources;
   • Add all non-excluded unearned income from all sources;
   • Add all deemed and allocated income;
   • Subtract legally obligated child support payments made by an AU member to or for a person who isn't a member of the AU.
2. Compare total gross income to the gross income standard.
3. Deny the application or terminate benefits for AUs with income above the gross income standard under WAC 388-478-0060 unless the AU:
   • Includes an elderly or disabled person; or
   • Is categorically eligible (CE) under WAC 388-414-0001.
4. Determine net income for AUs that meet the gross income standard and for AUs containing an elderly or disabled member.

Net income:

Start with all dollar and cent amounts for income not excluded for Basic Food and all allowable expenses.

1. Subtract the following from the AU’s gross income:
   • The appropriate standard deduction based on AU size;
   • The earned income deduction, if appropriate, which is 20% of gross earned income;
   • Out-of-pocket dependent care expenses;
   • Allowable non-reimbursable medical expenses over $35 for persons in the AU who are elderly or disabled.
2. Calculate the shelter cost income deduction:
   • Start with the AU’s allowable monthly shelter costs including the utility deduction;
   • Subtract ½ of the result from step 1 above.
     • If the AU includes a person who is elderly or has a disability, we use the result from step b above as the shelter cost income deduction.
     • If the AU doesn't include an elderly or disabled person, we use the lesser amount of the result from step b or the maximum shelter deduction for these households under WAC 388-450-0190.
3. Take the result from step 1. Subtract the result from step 2 to calculate the AU’s net income. Round this value to the nearest whole dollar (Round up from $.50 and down from $.49.)
4. Compare net income from step 3 to the net income standard.

Eligibility:

Deny or terminate benefits if they aren't CE under WAC 388-414-0001 and their net income is over the net income limit under WAC 388-478-0060.

Benefit level:

For eligible AUs, determine their monthly benefit level by using the allotment formula or basis of issuance tables:

Allotment formula:

• Multiply the AU's net income by 30%;
• Round this amount up to the next whole dollar; and
• Subtract the result from the Maximum Allotment for the number of eligible AU members.

Basis of Issuance:

Use the AU’s net income and household size to look up their monthly benefit amount using the Basis of Issuance Table - DSHS 12-006.

Worker Responsibilities - WAC 388-450-0162

In an emergency situation when ACES is not available, calculate benefits for an AU eligible for Basic Food benefits by using Steps 1 - 3 above.

ACES determines benefits for AUs appropriately based on the circumstances of the household including citizenship and alien status. For households with non-citizens members, ensure that you code the Alien Status on the Client Information page in ACES 3G correctly and update an immigrant’s information at recertification.

Clarifying Information - WAC 388-450-0165

To find the gross earned income limit for TANF/SFA, see WAC 388-478-0035, Maximum earned income limits for TANF and SFA.

Clarifying Information - WAC 388-450-0170

1. If a client doesn't report income timely and we later discover this income, we recalculate the client's benefits as if they had reported timely and determine if there is a benefit error. Clients still receive the family earnings disregard, the allocated household income disregard (if eligible) and the 50% earned income incentive.
2. ABD clients receive an earned income incentive and as described in WAC 388-450-0177, ABD earned income incentive .
3. When we determine the dependent care maximum deduction, we use a child's age on the first day of the month as the child's age for that month (e.g., If a child turns two on August 15, we consider the child as under two for August and two years of age in September).

Clarifying Information - WAC 388-450-0185

For information on the shelter deductions, see WAC 388-450-0190.

For information on utility allowances, see WAC 388-450-0195.

For information on medical deductions, see WAC 388-450-0200.

Topics related to the above WAC include:

• Standard Deductions
• Child Support Payments
• Dependent Care Deductions
• Deductions for AUs with special circumstances

 Standard Deduction

1. The Federal government sets the standard deduction each October by comparing 8.31% of the current net income standard for the number of AU members to $167. The standard deduction is the larger of the two figures.
2. We only count eligible AU members for the standard deduction. We don't count ineligible members such as someone disqualified as an ineligible alien, or for an intentional program violation (IPV). We also don't count non-members such as ineligible students or someone who lives in the residence but isn't an AU member under WAC 388-408-0035.

Child Support Payments

1. We exempt legally obligated child support payments from gross income prior to administering the gross income test.
2. We exempt the lesser of the amount paid or the amount legally obligated. We don't exempt voluntary amounts paid over the legal obligation.
   
   NOTE:

   We allow an amount over the monthly support order if it's to repay back child support the client is legally obligated to pay.

3. We don't exempt payments that aren't legally obligated. Examples of payments that don't qualify for this exemption are voluntary payments and contributions for a child's needs not specified in the court order.
4. Clients don't have to report changes in the amount of child support they pay. We don't consider failure to pay child support as a change of circumstance. We are required to act on a change if clients report an increase or decrease in child support.
5. In addition to support paid for children outside the home, we allow the exemption when clients pay support for children now in the AU when the support is:
   1. Legally obligated; and
   2. For a period of time the child was outside the support payer's home.
6. If someone outside the AU consistently pays the child support obligation, we allow the child support exemption only if the AU member must repay the amount under a bona fide loan agreement.
7. If a child support order requires the client to make an in-kind child support payment instead of, or in addition to a cash payment, we allow the amount the client pays for this expense as a child support exemption. Examples of these in-kind orders include requirements for the non-custodial parent to pay a portion of child care or medical costs.

Dependent Care Deductions

1. We allow all of the out-of-pocket costs for dependent care for the dependent care deduction. This deduction is no longer limited based on the age of the person receiving care.
2. Only verify dependent care expenses when questionable.
3. Allow activity or other fees necessary to participate in the care.
4. Out-of-pocket travel expenses incurred when transporting dependents to and from a child care provider are allowable as part of the Basic Food dependent care deduction.
   
   EXAMPLE

   The day care center is located on the route the AU member drives to work. Mileage doesn't change for a stop at the day care center. The AU isn't eligible for a dependent care transportation deduction as no additional expense occurs.

   EXAMPLE

   The AU member takes her child to a day care center not located on her route to work. The stop at the day care center adds 10 miles in the morning and 10 miles in the afternoon 5 days per week. The AU is eligible for a dependent care transportation deduction. The actual related transportation expense is the 20 miles per day associated with the travel to the day care center.

   NOTE:

   Accept a client’s statement of dependent care transportation mileage unless it is questionable. Use MapQuest or Google Maps if the mileage is unknown or questionable.

5. Don't include the household's normal commute when determining the mileage incurred for dependent care transportation.
6. Only allow the dependent care transportation expense for the additional mileage incurred by the household member. Use the current business State mileage rate to estimate the allowable deduction.
7. Costs for other means of transporting dependents to and from the child care facility such as public transportation, paying a friend or relative outside the AU, or paying an additional amount for the daycare provider to transport dependents, are also allowable deductions.
8. A claimed amount over the State mileage rate is questionable and requires verification.
9. When a portion of the client's dependent care expenses are paid by Working Connections Child Care (WCCC) or any other source, the client may claim the dependent care deduction for the portion not paid by someone else.
10. Some clients have both subsidized and private-pay child care expenses. Clients can receive the deduction for both, as long as the requirements of WAC 388-450-0185 are met.
11. We allow dependent care expenses for a child that is not part of the food assistance household so a responsible household member can:

• Keep work, look for work, or accept work.
• Attend training or education to prepare for employment.
• Meet employment and training requirements under chapter 388-444 WAC.

Child care expenses for educational purposes:

1. If we disregard a client's educational benefits under WAC 388-450-0035, we can only allow a deduction for the anticipated child care expense above the amount "earmarked" for dependent care expenses.
2. We prorate earmarked funds over the period that the clients intend to use the educational benefits.

Dependent care deduction when the person with income is an ineligible AU member:

• If the ineligible member has income and dependent care expense billed to or paid by the ineligible member(s), we determine the deduction by:
• Dividing the expenses evenly among all the AU's eligible and ineligible members; and
• Assigning the prorated share of such expenses to the eligible members.

1. WCCC co-payment waived by the provider:

   We allow the dependent care deduction for a client's WCCC co-pay even if the provider waives the fee on a regular basis.

   NOTE:

   A household can only deduct expenses if someone outside of the assistance unit (AU) provides the service and the household makes a money payment for the service. For example, a dependent care deduction isn't allowed if another household member provides the care, or if compensation is an in-kind benefit, such as food.

Deductions for AUs with Special Circumstances

1. Drug and Alcohol Treatment Facilities: We allow the following deductions for clients who are paying a part of the cost of their own care:
   • Standard deduction;
   • The amount the client pays as a medical cost if treatment is prescribed by a physician; and
   • The amount the client pays that we don't use as a deduction in (ii) above as a shelter expense up to the shelter maximum.
   • Clients that don't pay a part of the cost of their own care receive the standard deduction only.
     
     NOTE:

     The deductions described above for D&A treatment facilities applies only when a client has been in the facility for more than 30 days.

2. Group living arrangements:

   For clients who live in group-homes, we follow normal eligibility procedures other than shelter costs. We determine the shelter costs for clients that pay room and board by deducting the maximum allotment for one person from the amount paid to the home.

   See WAC 388-478-0060 for maximum allotment.

Clarifying Information - WAC 388-450-0190

1. Allowable shelter costs:

• We allow the following ongoing and current shelter costs when calculating the shelter deductions for an assistance unit (AU):
  • We allow monthly rent cost including mandatory lease agreement fees for extra non-food expenses (e.g., cable, furniture, garage, and storage).
  • We count non-food expenses only when the lease or contract requires the client to pay the fees. For example, if a client's rent includes cable and the cable expense isn't optional, then the expense is considered mandatory and is allowable;
  • We don't count a mandatory fee for daily meals or toiletries as a shelter cost.
  • We use the monthly rental costs paid on time. We don't change the allowable shelter costs due to discounts for early payment or fees for late payment.
  • For AUs receiving HUD, FHA, or other rental subsidies, we allow only the out-of-pocket rent expense for the AU.
  • We allow money paid by one AU to another AU living in the same residence for a share of the total rent.
  • We allow rent paid in advance as an expense for the month the rent is due.

• We allow a homeless shelter deduction for households that pay shelter expenses and are considered homeless. For the current homeless shelter deduction, see WAC 388-450-0190.
• If the shelter costs expense is more than the homeless shelter deduction, allow the actual shelter expenses for a higher deduction. Only ask for verification if questionable.
• See Aces Manual - What is the Homeless Shelter Deduction for Supplemental Nutrition Assistance Program (SNAP)　households

2. For group home residents who pay a flat fee for room and board, we calculate allowable shelter costs by subtracting the one-person maximum allotment for Basic Food from the amount paid to the home.
3. AU members that own or are buying a home can use the following home-ownership expenses as a shelter cost:
   • Payments on first and / or second mortgages (including home equity loans & home equity lines of credit);
   • Real estate contract payments, loan payments including interest, leading to ownership of the house or mobile home;
   • Property taxes. When an AU has their property taxes deferred to a later date, we allow only the deductions for the taxes at the point the tax would be due without a deferral. We don't allow taxes as a shelter cost if the taxes have been waived;
   • State and local assessments;
   • The entire amount of condo fees;
   • Mandatory homeowner's association fees;
   • Structural insurance only. We allow the total cost of structural and furnishings insurance only when the structural insurance can't be separated from coverage for furniture and belongings;
   • Cost of an unoccupied home as allowed in WAC 388-450-0190;
   • Cost of home repairs resulting from a natural disaster such as fire or flood. We don't allow costs covered by insurance or other public or private sources; and
   • Costs for more than one residence in a single month when an AU moves mid-month.
4. Non-allowable shelter costs:
   We don't allow the following costs as a part of the shelter deduction:
   • The unpaid value of shelter a client receives free or at a reduced cost in exchange for work, referred to as "income in lieu of rent;"

• In-kind or non-cash payments instead of paying rent;

• Payments on a mortgage in excess of monthly minimum payment (pre-paying mortgage);
• Down payments on a mortgage;
• Balloon payments on a mortgage;
• A payment toward the purchase of a home that is made after the last contract payment for the home;
• A payment on a foreclosed home if the client is no longer legally obligated to pay the mortgage:
• A HUD add-on to contract rental charges to recover previously undercharged rent.
• Security or rental deposits;
• Rental insurance not included in the rent which does not cover the structure - even if it is mandated by the lease;
• Pre-payment of future rent;
• Payments made directly to landlord or mortgage company by non-AU members;
• Mandatory fees for meals specified in lease agreements.
• Late fees;
• Payments on mortgage or rental costs for a previous time period;
• Costs for an unoccupied home unless allowed in WAC 388-450-0190.
• Shelter expenses consistently paid by someone outside the AU. If a parent, friend, or agency pays the client's shelter costs only on occasion, the AU is still eligible for the full shelter expense deduction. Don't allow HUD or FHA or other subsidies as shelter costs.
• Shelter deductions above the maximum shelter cost for an AU without an elderly or disabled person or where the only elderly or disabled AU member is an ineligible AU member.

3. Shared living / Roomers: 
   1. AU owns or is buying home.

      When an AU owns or is buying a residence and shares the residence with another AU, we consider the AU that owns the home to have a roomer.

      1. Count the rent paid to the homeowner as self-employment earned income. See Self Employment Income- Clarifying Information to determine income from a roomer.
      2. The roomer receives the shelter deduction for;
         1. The rent paid to the owner; and
         2. A standard utility allowance (SUA).
      3. The owner receives the shelter deduction for the standard utility allowance (SUA) and either:
         1. The portion of shelter costs not used as a self-employment expense based on number of bedrooms in the residence and the number of bedrooms rented out; or
         2. All expenses the landlord must pay for the housing costs.

1. Consider AUs that rent a residence to have roomers when:
   1. They rent out a portion of the residence to someone outside of the AU; and
   2. The rent they receive is more that the total rent obligation for the AU as shown on the rental agreement or lease.
2. Count the rent paid to the AU as self-employment earned income. See Calculating Net Self-Employment Income in Special Situations to determine income from a roomer.
3. The roomer receives the shelter deduction for:
   1. The rent paid to the AU; and
   2. A standard utility allowance (SUA).
4. The AU receives the shelter deduction for the standard utility allowance (SUA) and either:
   1. The portion of shelter costs not used as a self-employment expense based on number of rooms in the residence and the number of rooms rented out; or
   2. All costs the AU must pay for the housing. See Clarifying Information of WAC 388-450-0195 for information on utilities.
5. Clients that share a residence aren't considered to have roomers if they:
   1.  Don't own the residence;
   2.  Aren't buying the residence; and
   3.  Don't charge their roommates an amount above the total rent as shown on the lease.

Worker Responsibilities - WAC 388-450-0190

Determining Homeless Shelter Deduction
The system will determine if the household is entitled to the homeless shelter deduction. To ensure the deduction is correctly determined:

1. Code the correct living arrangement for the homeless client on Client Details.
2. Review the case for shelter expenses and enter expenses on Shelter Details.
   1. If the client doesn't have shelter expenses they won't qualify for the $190 standard homeless deduction.
   2. If the client does have shelter expenses:
      1. If the shelter expenses results in the total shelter deduction being equal to or less than $190, the client will receive a homeless shelter deduction in the amount of $190. 
      2. If the shelter expenses results in the total shelter deduction being more than $190, the client will receive the higher allowable shelter deduction.

Clarifying Information - WAC 388-450-0195

1. The Standard Utility Allowance (SUA)

   1. How can an AU qualify for SUA?
      An AU qualifies for SUA if the AU:
      NOTE:

      The utility standards come from an average annual expense. Clients that heat with oil and fill the tank once a year are eligible for SUA for the entire year, even though they actually pay the bill in one month.

      WASHCAP households receive SUA as a part of the WASHCAP demonstration project waiver. If a person loses eligibility for WASHCAP, we must review the household's eligibility for SUA, LUA, TUA, or ZUA (zero utility allowance) based on their current circumstances.

      A vendor payment to partially or occasionally cover heating or cooling costs the client is responsible to pay does not affect the client’s eligibility for SUA. Examples include when a friend, relative, AREN, or another agency pays the expense.

      1. Is responsible to pay out-of-pocket heating or cooling costs separate from rent or mortgage costs;
      2. Receives a LIHEAA (Low Income Home Energy Assistance Act) payment of more than $20 annually for the AU's current residence from a state or local agency or from an Indian Tribal Organization; or
      3. Lives in public housing, uses a shared utility meter, and pays only for excess utility expenses.

         To determine that a household is eligible for the SUA based on getting a LIHEAP benefit of more than $20, we must be able to reasonably expect that the household will receive the benefit.

         • ​If the household has received this benefit previously, and they have not moved or had another significant change in circumstances, we can expect that their LIHEAA eligibility has not changed.
         • If someone received SUA as a part of their WASHCAP benefits and they lose eligibility for WASHCAP, we must redetermine their eligibility for SUA, LUA, TUA, or ZUA based on their current circumstances.
   2. What counts as a heating cost?

      Clients have a heating cost when they are responsible for out-of-pocket fuel costs to operate a device used as the primary heat source for the living quarters.

      EXAMPLE

      A client who buys a cord of firewood or buys pellets for the client's pellet stove would qualify for SUA. A client who buys a chainsaw, gasoline, and a permit to cut firewood does not qualify for SUA if the client has no costs for wood fuel.

      EXAMPLE

      Client has an apartment with steam heat. An electric fan brings heat into the apartment for which the client pays separately. The heat is included in the cost of renting the apartment. This client isn't eligible for SUA.

      EXAMPLE

      Client has a wood stove and wood provided by the landlord, but the client’s doctor has advised him that the wood stove is aggravating his asthma. The client uses an electric space heater instead, and pays for the electricity for the residence. In this case, we would allow the SUA.

      NOTE:

      When we allow the SUA for a client that uses a source different than what is standard for the home, we must document that the source is the client's primary heating source. If a heating cost is included in the rent, we must document why this source of heat isn't available.

      • If wood is the primary heat source for the residence, the client must have out-of-pocket costs for the wood fuel. Costs to operate a cooking stove, oven, or indirect costs for gathering wood don't qualify the AU for SUA.
      • If a client is responsible to pay the cost of using a device that delivers heat, but no costs to create the heat, the client does not qualify the AU for SUA.
      • Costs to operate any device that is used as the client's primary heat source qualifies the AU for SUA when:
        • The landlord does not include heating costs in the rent; or
        • The landlord includes heating costs in the rent, but the heating is unavailable. We consider it to be unavailable if:
          • The source of heat isn't working; or
          • The client can't use the source of heat for health reasons.
   3. What counts as a cooling cost?

      Clients have a cooling cost when they are responsible to pay costs to operate an air conditioning system, room air conditioner, or swamp cooler. (Electric fans don't count as air conditioners.)

   4. How do you tell if the cost is separate from rent?
      We consider heating or cooling costs as separate from rent when the AU must pay for utilities separately from the rent or itemized individually.
   5. How do you tell if a client qualifies for a utility allowance or if utilities are included in the rent?
      • If all utilities are clearly included in the rent, clients receive the shelter deduction for the rent amount and no utility allowance.
      • If it isn't clear whether all utilities are included with rent, we must determine if the client:
        • Pays separately for any utilities;
        • Has a specific portion of the rent consistently designated to cover utilities;
        • Pays for excess utility usage; or
        • Pays rent only.
   6. What happens when households in separate residences share a common utility meter?

      When households in two residences share a utility meter for heating or cooling, each AU can receive a SUA. If the shared utility meters aren't for heating or cooling services, each AU can receive a LUA if they pay for another countable utility.

      EXAMPLE

      In a shared residence, one AU pays for all utilities, except phone service. This includes heating. They don't pay for phone service. The other AU receives the phone bill and pays for phone service. Each AU is eligible for a SUA.

      EXAMPLE

      Landlord provides heat, but the client uses an additional heat source because the landlord's system doesn't heat well enough. In this case, we don't allow the SUA.

      EXAMPLE

      Client lives in a trailer and gets electricity (heat source) from an extension cord to a friend's house. The friend gets the bill and charges the client for her share of the bill each month. The client and the friend each qualify for a SUA.

2. The Limited Utility Allowance (LUA):

   NOTE:

   The utility standards come from an average annual expense. Clients that have their septic tank or well system serviced once a year can have this expense count as one of their two qualifying expenses for the LUA.

   1. What is required for an AU to be eligible for LUA?
      To qualify for the LUA, an AU must be responsible to pay any two allowable out-of-pocket utility costs:
      1. Separate from rent or mortgage costs;
      2. That don't qualify the AU for the SUA; and
      3. May include telephone as one of the costs.
   2. What costs qualify a client for the LUA?
      Any two of the following expenses will qualify an AU for the LUA:
      1. Electricity or gas not used to heat or cool the residence;
      2. Cooking fuel;
      3. Water;
      4. Telephone service:
      5. Garbage/trash collection; or
      6. Sewer, well or septic tank costs.

3. The Telephone Utility Allowance (TUA):

   EXAMPLE

   Client has a cell phone. The bill for several cell phones are in the client’s mother’s name. The client’s mother verifies that the client is responsible for paying the portion of the bill associated with their phone. The client qualifies for the TUA.

   1. How do clients qualify for the TUA?
      Clients qualify for the TUA when they:
      • Don't qualify for the SUA or LUA; and<
      • Incur or expect to incur costs for telephone service.
   2. ​Does voicemail, or a pager qualify a household for the TUA?
      Costs for alternative phone services such as beepers, voice mail, pagers and cellular phones qualify a household for the TUA if they don’t receive a higher allowance for the SUA or LUA.
   3. Does an AU qualify for the TUA if the AU must pay the phone bill, but they aren't listed on the bill?
      Clients qualify for the TUA if they can verify that they are responsible for the telephone service. This is true even if they aren't named on the bill.
   4. Can two AUs in one residence each have a phone service and each qualify for a TUA? Yes.
4. How ineligible AU members affect the SUA:

   Our utility allowances (SUA, LUA, or TUA) apply for all Basic Food households, even if there is more than one assistance unit in a single residence.

   Even if e prorate expenses of an ineligible member as a part of the AU’s expenses as described under WAC 388-450-0140, we don't prorate the SUA, LUA, or TUA.

Worker Responsibilities - WAC 388-450-0195

1. Determine the appropriate utility allowance:
   1. Decide if the AU is eligible for:
      1. The standard utility allowance (SUA);
      2. The limited utility allowance (LUA)
      3. The telephone utility allowance (TUA).
   2. Deny utility allowance to AUs:
      1. When all utility costs are included as part of their rent;
      2. Who have only one utility expense that isn't for heating, cooling, or phone.
2. Redetermine if an AU qualifies for the SUA, LUA or TUA:
   1. At recertification, including when a household who received WASHCAP benefits is now applying for Basic Food;
   2. When an AU changes residences; and
   3. When the client reports the beginning or end of heating and/ or cooling costs. For example: The client has been using free wood for heating and now reports that they are now using heating oil.

Go to Utility Chart

Clarifying Information - WAC 388-450-0200

1. To be eligible for the medical deduction, people must report all incurred and anticipated medical expenses at application and recertification.
2. We must verify all claimed medical expenses.
3. We don't have to re-verify ongoing medical expenses during the certification period if they aren't likely to change.
4. People don't have to report any changes in medical expenses during the certification period.
5. At recertification, verify unchanged expenses that are incomplete, inconsistent, or outdated. Note: For ESAP households, see recertification requirements in the ESAP Chapter.
   For non-ESAP assistance units, we don't have to re-verify medical expenses that:
   1. Don't change by $25 or more, and
   2. Are from the same provider as previously reported.
6. Anticipated expenses:

   Persons eligible for a medical deduction may estimate medical expenses they expect to incur during the certification period.

   1. Base the estimate upon current, verified medical expenses that the AU member incurred, as well as other available information about the member's medical condition and insurance coverage.
   2. Don't pend an application or certification for verification of medical expenses. We allow the expense when the member provides verification during the certification period.
   3. We treat the changes in recurring medical expenses that an AU voluntarily reports as a CHANGE OF CIRCUMSTANCES.
7. Incurred expenses:

   We allow out-of-pocket medical expenses that the eligible AU member incurs when the person:

   1. Has an unpaid bill that has not been allowed previously,
   2. Has a paid bill incurred during the certification period not reported previously; or
   3. Arranges a payment plan for an expense and verifies when the installments are due.
8. One-time medical expense deduction:

   Customers who report a one-time, non-recurring medical expense can elect to have the entire expense budgeted in a single month for a one-time deduction. This would be a likely choice for bills that when averaged using one of the options in WAC 388-450-0200(3)(a) would not result in an increase in benefits.

   EXAMPLE

   Joan reports on May 20th that she paid for a doctor visit on May 15th in the amount of $200. She has 10 months remaining in her certification period. Averaging the expense would only allow a $20 monthly expense and would not impact her ongoing Basic Food benefits since she has no other expenses. Joan could choose to budget the $200 in one month and either have her May benefits supplemented or have her June benefits increased.

9. Medical expenses of other AU members:

   This deduction is only for out-of-pocket costs for medical needs of individuals that are elderly or have a disability. We don't allow a deduction for medical expenses of an AU member who isn't an elderly person or does not have a disability under WAC 388-400-0040 even if the individual in the AU who does meet these criteria pays the medical expense.

10. Medical equipment: We can allow the cost of equipment as a medical deduction if necessary due to the person's medical condition. Examples of allowable medical equipment are:
    
    NOTE:

    If a person has home modifications related to their medical condition completed along with other home improvements, we only allow the cost of improvements related to the medical condition if identified separately in the billing.

    If a second mortgage pays for the improvements, we allow the entire amount as a shelter expense instead of a medical expense.

    1. Specialized telephone devices or TTY for hearing impaired people; and
    2. Items needed for people with limited mobility such as:
       1. Wheelchairs;
       2. Walkers; and
       3. Modifications to the person's home such as:
          1. Grab bars;
          2. Wheelchair ramps; and
          3. Lowered countertops

11. Health insurance premiums:

    1. We don't allow the cost of third party health and accident insurance when the insurance benefit:
       1. Is payable in a lump sum payment upon death or dismemberment;
       2. Covers mortgage or loan payments upon death or disability; or
       3. Qualifies for reimbursement.
    2. We allow the cost of Medicare premiums as a deduction:
       1. When the person is responsible to pay the premium;
       2. incurs an out of pocket expense for the premium; and
       3. The premium isn't reimbursable.

1. Reasonable medical transportation costs:

   We must determine transportation costs on a case-by-case basis. It is essential that the case documentation clearly show reason for approval or denial. If the cost is reasonable according to the situation, we can allow the costs. Examples of allowable expenses are:

   1. Bus fare to get to medical appointments;
   2. Mileage for a privately owned vehicle. Section 10.90.20 of The Office of Financial Management’s State Administrative and Accounting Manual provides information on the current rate.
   3. A rental car or taxi in an area or circumstance where bus service or a private vehicle isn't available; and
   4. Long-distance phone calls to the person's medical practitioner instead of travel.

2. Postage or shipping cost for mail-order prescriptions:

   Some people who use mail-order pharmacies must pay a shipping or postage fee in addition to the cost of their medicines. We allow the out-of-pocket costs of medications for certain AU members as an expense for the excess medical expense deduction. This includes postage or shipping fees if they aren't included in the cost of the medications.

3. Spenddown:

   We don't allow the total spenddown obligation as a medical expense. We allow the out-of-pocket expenses a client incurs or anticipates.

4. Service Animals:

   We allow the costs to get and care for seeing, hearing, and specially trained service animals. Service animals must be specially trained to perform functions the client can't perform on their own. A pet the client had before having a service animal prescribed does not automatically become a service animal. However, we can't require a specific type of training, credentials, or certification.​

We don't consider comfort or emotional support animals as service animals.

A licensed or qualified medical practitioner has to prescribe the service animal for us to accept associated medical expenses.

1. Attendant care:

   We allow attendant care that is necessary due to age, infirmity, or illness. Allowable attendant care includes, but isn't limited to:

   1. Homemaker;
   2. Home Health Aide; or
   3. Housekeeper
      
      NOTE:

      We allow an additional deduction equal to a one-person allotment if the AU provides the majority of the attendant's meals. We update the deduction at the next recertification if allotments are increased during the certification period. * * * * * If attendant care can be claimed as either a dependent care or medical expense, we allow the deduction as a medical expense.

2. Expenses from non-standard providers:

   We allow medical expenses prescribed by a state-licensed practitioner or other state-certified health professional. If the person's health professional prescribes the treatment, we allow the medical deduction. Expenses we allow when prescribed by a licensed or certified health professional include treatment by:

   • Acupuncturists;
   • Sanipractors;
   • Homeopathists;
   • Herbalists;
   • Massage Therapists; and
   • Christian Science practitioners or theological healers

3. Installment agreements:

   We allow expenses anticipated to become due in an installment agreement. If the person misses some payments, we don't allow the expense again when it is actually paid, as it has already been allowed based on when it was originally due.

4. Expenses from medical marijuana:

   The costs of medical marijuana and transportation expenses as described in # 10 above to and from the medical marijuana dispensary aren't allowable as a medical expense income deduction for Basic Food.

   NOTE:

   There is no need to ask applicants or recipients why the individual went to see a doctor or other medical practitioner to find out if the doctor prescribed marijuana. Allow reasonable transportation costs for visits to licensed medical practitioners without regard to the reason for the visit.

Worker Responsibilities - WAC 388-450-0200

Determining Allowable Medical Expenses

1. Review the application for claimed medical expenses.
2. Ask all AUs with an elderly person or an individual with a disability if those members have any medical/dental bills or expect to have these expenses.
3. Verify the portion of the expense that will not be reimbursed or paid by another source by obtaining:
   • A billing from the provider showing the amount due after insurance coverage; or
   • Proof of the amount of covered and uncovered expenses from all insurance carriers including Medicare.
4. Certify the AU's benefits without the claimed deduction if the expense isn't verified.
5. Allow the Medicare premium deduction for the month(s) without an approved MSP AU only.
6. Enter end of the application months as an end date for the deduction.

Clarifying Information - Cost Of Living Adjustment

COLA increases are not counted as income until April 1 of each year for the QMB, SLMB, ESLMB, QDWI, and QI programs.

The medical programs described in subsection (3) of the above WAC use the TANF / SFA income rules to determine countable income. After determining countable income, treatment of income for medical programs may be different. For example, see the Assistance Units for more information on family financial responsibility and when to establish separate medical assistance units.

The income exclusion described in subsection (4)(i) assists families to meet the "three out of last six months" federal requirement.

Aces Procedures

• See Interviews - (DPEX) Dependent Care Expenses
• See Interview - (SHEL) Shelter Expenses