Determination of Family Income for Adults & Youth 1.

Determination of Family Income for Adults & Youth

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Low income

Eligibility Staff must determine whether an Adult or Youth is “low-income”

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“Automatic” Low-Income Status

“Automatic” low-income criteria:Individual/family receives public cash assistanceIndividual is a member of household that receives Food Stamps or is determined eligible for Food Stamps during the 6-month period prior to application

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“Automatic” Low-Income Status

HomelessFoster Child

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FAMILY INCOME

If an Adult or Youth is not determined low-income under one of the automatic criteria, eligibility staff must record and document family income.

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FAMILY INCOMEWIA Definition

An individual who received an income, or is a member of a family that received a total family income, for the 6-month period prior to application that, in relation to family size, does not exceed the higher of –

The poverty line, for an equivalent period; or

70 percent of the lower living standard income level, for an equivalent period

is considered low-income.

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FAMILY INCOME

To determine family income, follow several steps:1.Determine family composition (size)2.Gather information about all includable sources of income for each member of the applicant’s family

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FAMILY INCOME

3. Document all sources of includable income

4. Calculate the family income for the 6 months prior to application

5. Multiply 6-month income by 2 to get “annualized” income.

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FAMILY INCOME

Recording family income in the State Management Information System (MIS)Record family sizeRecord annualized family incomeCompare family income/family size to Federal poverty/LLSIL guidelinesNote: the State MIS will automatically match family size/income to determine whether the applicant is low income.

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FAMILY COMPOSITION

Under WIA, a family is composed of individuals who are related by blood, marriage, or court decreewho live in a singleresidence

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FAMILY COMPOSITION

A family is defined as:A husband and wife (and their dependent children, if applicable)A parent or guardian anddependent children

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FAMILY COMPOSITION

Unmarried individuals with no children:Adult is generally considered family of 1Youth generally counted as member of parent(s)’s or guardian’s family“Dependency” follows IRS guidelines

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VERIFICATION OFFAMILY COMPOSITION

To verify family composition (size), the following records may be used:Birth CertificatesDecree of CourtPublic Assistance/Social Service RecordsMarriage CertificatePublic Housing AuthorityTelephone VerificationApplicant Statement in limited cases

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INCLUDABLE INCOME

The Agency for Workforce Innovation(AWI) issued a Memorandum onApril 14, 2010 that clarified whatis includable and excluded incomeunder WIA. Some of the most commonsources of INCLUDABLE income are:

$ Wages and salaries before deductions

$ Net receipts from self employment, including from farming

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INCLUDABLE INCOME

$ Pension or retirement income

$ Alimony

$ Net rental income

$ Interest, dividends, royalties, periodic receipts from estate or trust

$ Educational assistance and training stipends (unless specifically excluded)

$ Other sources of revenue considered reportable income by the IRS

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EXCLUDED INCOME

The April 14, 2010 Memorandum also describes sources of income that are not counted to determine family income. The most common types of EXCLUDED income include:Military pay and allowances while on active dutyDisability & death benefits for veterans and eligible personsEducational benefits for veterans and eligible personsSocial Security BenefitsUnemployment compensation and Trade Readjustment AllowancesPublic cash assistance & noncash assistance

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EXCLUDED INCOME

Needs-based scholarships and financial aid

Child support Capital gains, asset draw-down Tax refunds, gifts, loans One-time unearned income WIA training stipends Payments from a Supplemental Needs

Trust (special needs trust) Non-cash benefits from employer Any payment that is specifically

excludable under federal law

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VERIFICATION OFFAMILY INCOME

Acceptable Documentation of Family Income: Pay Stubs Employer Statement/Contact Tax Return or Quarterly Estimated Tax (for

Self-Employment) Business Financial Records (for Self-

Employment) Alimony Agreement Pension/Annuity Statement Telephone Verification Applicant’s Statement, in limited cases

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DETERMINING LOW-INCOMEScenario 1 – Family Composition

Matteo, a 22 year-old applicant lives with his girlfriend, Roxanna, and her two children, one of which is his. How many individuals are counted as members of his family (including the applicant)?

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Answer: It depends on whether his child is considered to be his dependent for tax purposes.* If dependent, the family size is 2.* If not dependent, the family size is 1.

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DETERMINING LOW-INCOMEScenario 1 – Family Income

We have determined that Matteo’s child is listed on his tax return as his dependent.The income in the household for the last six months consists of:Matteo’s wages: $8,000Disability benefits from VA to Roxanna: $3,600Child support payments to Roxanna for care of the other child: $4,800What is the applicant’s family income for the previous six months?

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Applicant’s Family Income

Six-month income:

Matteo’s wages$8,000

Annualized income: $16,000

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DETERMINING LOW-INCOMEScenario 1 – Low Income?

Last Step: Determining whether the applicant’s annualized income is below the higher of:the Poverty Level, or70% of the LLSIL

In 2009, for a family of 2, the following income levels applied:Poverty $14,57070% LLSIL (Metro) $13,63070% LLSIL (Non-Metro) $13,353This applicant did not meet the low-income criterion.

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We now have a married couple, Ulric and Wendy, with an 18-year old child. Wendy is applying for WIA services.

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QUIZ 1.How many individuals are counted as members of the applicant’s family (including the applicant)? Pick all possible answers.a.1b.2c.3

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QUIZ 1Correct answer: b.2c.3Both are possible answers depending on whether the child is a dependent on the parents’ tax return.

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The income in the household for the last six months consists of:Ulric’s wages of $8,000Disability benefits from VA to Wendy (applicant) of $3,600Social Security Disability Benefits to Wendy of $4,800

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QUIZ 2What is the family income for the previous six months?a. $8,000b. $9,600c. $12,200d. $15,800

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QUIZ 2Correct answer:a. $8,000

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Includable Family Income

Six-month income:

Husband’s wages $8,000

Annualized income: $16,000

Excluded IncomeVeteran’s disability benefits $3,600Social Security Disability $4,200

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QUIZ 3If Wendy’s child is a dependent, does Wendy’s family income meet the low-income requirement?a.Yesb.No


QUIZ 3Correct answer:a.Yes

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Individuals with a Disability

WIA provides an additional mechanism for determining an applicant to be “low-income”.This mechanism applies to an individual with a disability who does not meet any of the “automatic” low-income criteria and whose family income exceeds the low-income levels. The applicant may still be determined to be low income if:The individual’s disability is verified, andThe individual’s own includable incomemeets the low-income levels

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Acceptable sources of documentation of disability:Letter from a Drug or Alcohol Rehabilitation AgencyMedical Records/Physician’s StatementPsychiatrist’s StatementPsychologist DiagnosisWorkers Compensation RecordsSocial Security Administration Disability RecordsVeterans Administration Records

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Acceptable Documentation (continued): Social Services Records/Referral Rehabilitation Evaluation School Records Sheltered Workshop Certification Vocational Rehabilitation Letter Applicant Statement, in limited

cases


Our new applicant, Jai, is an 18 year old who has been diagnosed with cerebral palsy. Jai lives with and is supported by his parents. He has no siblings.

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The income in the household for the last six months consists of:Father’s wages of $18,000Mother’s self-employment net income of $18,000Applicant has no income

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DETERMINING LOW-INCOMEScenario 3, Individual with Disability

QUIZ 4

The applicant meets the low-income criterion.

a.True

b.False

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DETERMINING LOW-INCOMEScenario 3, Individual with Disability

QUIZ 4

Correct answer:

a. True

Questions or Additional Information

If you have any questions or for additional information, please contact DEO’s WIA policy and technical assistance staff at: [email protected].

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Determination of Family Income for Adults & Youth 1.

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