43. Income deductions for food stamp households
- Allowable deductions for all food stamp households
- Special deduction for households with an “elderly” or “disabled” member
As discussed in the sections about the definition of “income” and income limits in the Food Stamp Program, the net income of all households must be below the net income limit. [MPP §§ 63-503.321(a)(QR), 63-503.323(a); 7 C.F.R. § 273.9(a).] Note that households with no elderly or disabled members also have to meet the gross income test. [MPP § 63-503.321(a)(QR); 7 C.F.R. § 273.9(a).]
Households can deduct certain expenses from their gross income to determine their net monthly income. [MPP § 63-502.3; 7 C.F.R. § 273.9(d).] Worksheets help with calculating income and benefit allotments. The list of maximum food stamp deductions inventories the current amounts allowable for each deduction category.
Allowable deductions for all food stamp households
- earned income deduction: 20% is deducted from gross earned income (income from work such as salary, wages, and tips). [MPP §§ 63-502.13, 63-502.32; 7 C.F.R. §§ 273.9(d)(2), 273.10(e)(1)(i)(B).];
- standard deductions: Standard deduction amounts vary with the number of household members. [MPP § 63-502.31;7 C.F.R. §§ 273.9(d)(1), 273.10(e)(1)(i)(C).] Standard deductions are 8.31% of the current net income limit for the household size. [MPP § 63-502.311(b); 7 C.F.R. § 273.9(d)(1).] It cannot be more than 8.31% of current net income limit for six persons, even if the household is larger than six persons. [MPP § 63-502.311(a).] (See the list of maximum food stamp deductions for current deduction amounts.) ACIN I-62-11E lists the rates for Oct. 2011 through Sept. 2012.
- dependent care deduction: Food stamp households can deduct actual costs that they pay for child or other dependent care. [MPP § 63-502.34; 7 C.F.R. §§ 273.9(d)(4), 273.10(e)(1)(i)(E).] The care must be necessary for a household member to accept or continue work, comply with the requirements of the Food Stamp Employment and Training (FSET) program, or attend training or education that prepares the person for work.
- homeless shelter deduction: Homeless households can claim the homeless shelter deduction of $143 per month if they pay for some shelter during a month. [MPP § 63-502.351; 7 C.F.R. §§ 273.9(d)(6)(i), 273.10(e)(1)(i)(G).] With implementation of the “Heat and Eat” LIHEAP program (see ACL 13-35), most homeless households will just take the full Standard Utility Allowance (SUA). For some households (though with income over a certain amount), ae disadvantaged by the SUA, and counties are required to calculate whether the shelter income deduction or the SUA would be more beneficial and then provide the most favorable deduction. All homeless households that incur, or reasonably expect to incur, shelter costs during a month are eligible to use the deduction without verifying the shelter costs. [MPP § 63-502.353.] The households can claim a higher shelter deduction if they can verify higher shelter costs. [MPP § 63-502.353; 7 C.F.R. § 273.9(d)(6)(i).] Homeless households that receive this deduction cannot receive the standard utility allowance (SUA) or the excess shelter deduction. [MPP §§ 63-502.351, 63-503.352; 7 C.F.R. § 273.9(d)(6)(i).] Homeless households can claim the excess shelter deduction if their verified homeless shelter costs exceed the homeless shelter deduction. [MPP § 63-502.362(a).] They can also claim the standard utility deduction. [Id.] If a household claims the excess shelter deduction and the SUA, the household cannot claim the homeless shelter deduction. [MPP § 63-502.351, 63-502.352.]
- excess shelter deduction: The excess shelter deduction is monthly shelter costs that exceed 50% of the adjusted household income (income after other allowable deductions). [MPP § 63-502.36; 7 C.F.R. §§ 273.9(d)(6)(ii), 273.10(e)(1)(i)(H) and (I).] To determine the excess shelter deduction, add shelter costs and the utility deduction. [MPP § 63-362.] Subtract the shelter costs from 50 percent of the adjusted household income. [MPP § 63-503.36; 7 C.F.R. §§ 273.9(d)(6)(ii), 273.10(e)(1)(i)(G).] Households with no elderly or disabled members can take this amount as an excess shelter cost deduction or the current shelter deduction maximum, whichever is less. [Id.] Households with an elderly or disabled member can deduct the full amount. [Id.] (See Worksheets for the calculation.) Effective October, 2009, the maximum shelter deduction is $459, except for households with senior/disabled members (see below). ACIN I-06-09
- Shelter costs: are based on what the household has been billed for (it does not matter if the household has not paid the bill). [7 C.F.R. § 273.10(e)(1)(i)(G).] Shelter costs include: rent, mortgage payments, home association fees, payments on a mobile home and rent for the space where it is parked, electricity, gas, heating oil, bottled gas, firewood, water, sewage, garbage, taxes and insurance on the house, repairs to the house caused by a fire, flood, storm or other disaster, installation fees for utilities or telephones and the basic charge for one telephone. (The household cannot count the unpaid balance on these bills from an earlier month). [MPP § 63-503.362; 7 C.F.R. §§ 273.9(d)(6)(ii)(A) through (E).] The maximum shelter deduction is $446 unless there is an aged/disabled household member. Households with aged or disabled members can deducted the full amount of excess shelter costs.
- Utility deductions
- Standard Utility Allowance (SUA): The standard utility allowance (SUA) is a fixed amount, adjusted annually by the California Department of Social Services (CDSS), for households that have heating or cooling costs separate from their rent or mortgage payments. [MPP § 63-502.363(a)(1) and (b); 7 C.F.R. § 273.9(d)(6)(iii)(C).] (See Maximum food stamp deductions for the current SUA amount.) The SUA is not pro-rated for shared living situations or living with excluded household members. MPP § 63-502.371 and .372. With the implementation of the “Heat and Eat” program, all households get the SUA without further verification, except homeless households given the shelter deduction (when more favorable than the SUA). ACL 12-61. (This is because the county has verification that the LIHEAP energy benefits was issued, which by law qualifies the household for the SUA.)
Households receiving energy assistance payments made under the Low Income Home Energy Assistance Program (LIHEAP) can claim the SUA. [MPP § 63-502.363(a)(2); 7 C.F.R. § 273.9(d)(6)(iii)(C); ACL 13-35.] Households receiving energy assistance vendor payments made under other programs are eligible for the SUA only if they continue to pay out-of-pocket heating or cooling expenses during any month covered by the certification period. [Id.]
- limited utility allowance (LUA): A household that is not eligible for the SUA but has expenses for at least two separate types of utilities (other than heating and cooling) can claim a limited utility allowance (LUA), which is adjusted annually by CDSS. [MPP § 63-502.363(d); 7 C.F.R. § 273.9(d)(6)(iii)(A).] Utilities expenses for which the household can claim the LUA are telephone, water, sewerage, and trash collection. [Id.] (See Maximum food stamp deductions for the current LUA amount.)
- telephone utility allowance (TUA): A household that is not eligible for either the SUA or LUA but has telephone expenses can claim a telephone allowance (TUA) of $20. [MPP § 63-503.362(e).] Only households that have telephones or equivalent forms of communication can claim the TUA. [Id.]
Special deduction for households with an “elderly” or “disabled” member
- excess medical expense deduction: A household with at least one elderly or disabled household member can also deduct that member’s non-reimbursed medical expenses over $35. [MPP § 63-502.33; 7 C.F.R. §§ 273.9(d)(3), 273.10(e)(1)(i)(D).] See the section about medical expense deductions for more information.