Types of Earned Income

 

Earned Income is a mandatory verification. The following types of income are considered earned income for SNAP purposes:

 

Wages

 

Note

 

Income from a corporation is not a self-employment source. Earned income from a C or S Corporation is entered as Wages. See C Corporation & S Corporation Income

 

Important

Earnings of temporary decennial census workers are noncountable income. When entering this income in the earned income page you must select Temporary 2020 Census Worker from the Type drop-down.

 

 

Self-Employment

 

Student Earnings

The following student earning types are countable:

 

Note

 

Massachusetts does not currently operate a state-funded work-study program.

 

 

Verification of Income

The amount of all gross countable earned income must be verified prior to certifying a household eligible to participate in SNAP. However, when all attempts to verify the income have been unsuccessful because a third party providing the income verification has failed to cooperate with you or the household, and all other sources of verification are unavailable, you must determine an amount to be used for certification purposes based on the best available information.

The earned income verification must display the gross wages and the number of hours worked.

The following are examples of acceptable verifications of earnings:

 

Self-employment income is verified by:

 

Important

During the interview, the amount of hours the client worked must be reviewed and entered into BEACON to properly screen for ABAWD work program requirements.

 

Calculating a Missing Paystub

If a client submits paystubs but there is one missing, you must calculate the value of that missing paystub.

Step 1: Using the paystub received directly after the missing paystub, find the year-to-date total. Using the same paystub, deduct the gross income amount from the year-to-date total.

Step 2: Find the year-to-date total of the paystub received directly before the missing paystub. Deduct this total from the step 1 figure. The difference equals the gross income total of the missing paystub.

 

 Example 1: A client submits weekly paystubs for the last four weeks but is missing the   second paystub in the sequence.  

$800 – $400 = $400 gross income for the week two missing paystub


Determining Hours Worked When Not Available on Wage Stubs
When a client’s wage stubs or other earned income verification does not include the number of hours worked, but includes the client’s hourly rate:

Example: Jose submits the following weekly wage stubs:

Jose’s wage stubs list his hourly rate at $13.50 per hour but do not detail the hours worked per week. To determine the number of hours worked, the FAW handling Jose’s case performs the following calculations:

A detailed narrative must be included in any case where hours worked are determined in this manner.

If the client is experiencing difficulty obtaining verification, case managers and FAWs must explore verification by
collateral contact if this option is feasible for the client. If attempts to verify the information by collateral contact fail, the client may submit a self-declaration of their hourly rate for purposes of determining the client’s hours worked.

In rare occurrences, a client may
submit wage stubs, pay envelopes, employer statement, or other acceptable earned income verification that do not include their hours worked or their hourly rate. In these circumstances, a cold call must be made to the client and the client allowed to clarify this information. In this circumstance, the client may supply both their hourly rate and hours worked by verbal statement for purposes of determining the client’s hours worked. If contact with the client cannot be made, you must use the best available information to determine the client’s hours worked.   

For more, see Entering Hours When Not Available.

 

Income from Steady Employment

The four consecutive weeks prior to initial certification or prior to the recertification date must be used as an indication of anticipated income in the month of application and subsequent months, unless:

 

Anticipated Income

If income fluctuates to the extent that a consecutive four week period alone cannot provide an accurate indication of anticipated income, you may review a longer period to determine the most representative amount.

If any amount of income or anticipated date of receipt is uncertain, it must not be counted.

 

Example 2:  A client provides four consecutive pay-stubs but the last paystub in the series indicates the client has received a raise. The anticipated income should be based on the average hours, times the new hourly rate.

 

Note

 

If a household has income from a new source, such as a new job, but does not know the date or amount of the initial payment, the income cannot be considered anticipated.

If any portion or the total of the anticipated income is known and expected with reasonable certainty, that portion is considered countable income. If this monthly amount fluctuates, the household may elect to income average. See Income Averaging guidance below.

 

 

Income Averaging

In some cases, income averaging is mandatory. In other cases, if the income fluctuates, the household may elect to average the income over the certification period. However, in any migrant household case, income cannot be averaged. See Migrant Farm Laborers

The number of months used to arrive at the average monthly income does not need to be the same as the number of months in the certification period, but it must best represent the actual income received by the household.

 

Example 3:  Collect pay information from the last three months. Add all paystubs together and divide the answer by three months for a monthly pay amount. Divide the monthly amount by four weeks for a weekly amount. Enter this weekly amount as the weekly pay in BEACON.

 

Mandatory Income Averaging

Annual Income in Shorter Period

Households that derive their annual income in a period of time shorter than one year must have their income averaged over a twelve month period, provided the income is not received on an hourly or piecework basis. These households may include:

Income from Hourly and Piecework Employment

When income is received on an hourly wage or piece work basis, weekly income may fluctuate if the wage earner works less than eight hours some days or is required to work overtime on others. In this case, you should consult with the household to determine the normal amount of income to be expected as a result of one week’s work. This amount should be used to determine monthly income.

 

Income from Seasonal Employment

In cases where the household’s income is seasonal, you may find it more appropriate to use the income from the most recent earning season comparable to the certification period, rather than the four consecutive weeks prior to the application/recertification date or tax returns from a prior season as an indicator of anticipated income. You must exercise particular caution in using income from a past season as an indicator of income for the certification period. In many cases of seasonally fluctuating income, the income also fluctuates from one season in one year to the same season in the next year.

 

Withheld Wages

Withheld wages must be considered income if the money is/was otherwise owed to the client, such as repaying pay advances. If the employer withholds wages (even if unlawfully) that the household does not anticipate they will receive, the withheld wages cannot be counted as income in the household.

 

Credits

Some employers provide credits, flexible benefits, or flex credits, as a benefit to offset the costs of medical insurance, life insurance, etc. The term varies among employers. Flex credits are generally identified separately as credits on the pay stub, but are added to the employee’s total gross income.

Flex credits are non-countable, provided that they are used for benefits such as health insurance or life insurance, but cannot be taken as cash by the employee.

Due to differences among employers in the administration of flex credits you must check pay stubs closely to see if credits or flex credits or flexible benefits are identified in the earnings section of the pay stub. If so, follow-up is required to determine the correct amount of countable income on the pay stub. You must be sure to annotate the Narratives tab and retain the documentation from the employer or collateral contact in the case record.

 

Earned Income Policy and Procedures

 

 Last Update:  January 10, 2020