Navigating the complexities of income eligibility for Section 8 housing can be daunting, but What Income Is Excluded From Hud For Section 8 is a crucial question for both landlords and tenants. At income-partners.net, we provide clarity on this topic, offering resources and expertise to help you understand the nuances of HUD’s income exclusions, thereby enabling you to confidently manage or seek affordable housing opportunities. By exploring excluded income and asset determination you can better position yourself for partnership and growth.
Exploring partnerships and income growth? Let’s clarify HUD’s Section 8 income exclusions together!
1. Understanding HUD’s Income Exclusions for Section 8
1.1. What Types of Income Does HUD Exclude for Section 8 Housing?
HUD excludes specific types of income when determining eligibility for Section 8 housing to ensure a fair assessment of an applicant’s financial situation. These exclusions include certain tax refunds, allowances for children of veterans with disabilities, distributions from ABLE accounts, and emergency rental assistance payments. According to HUD Handbook 4350.3, these exclusions help provide a more accurate picture of available income for housing costs.
1.2. Why Does HUD Exclude Certain Income Sources?
HUD excludes certain income sources to provide a more accurate and equitable assessment of an applicant’s financial need for Section 8 housing. By excluding income such as emergency rental assistance or allowances for children of veterans, HUD ensures that temporary financial support or benefits intended for specific needs do not negatively impact a household’s eligibility for housing assistance. This approach aligns with HUD’s mission to provide safe, affordable housing to low-income families, the elderly, and people with disabilities.
1.3. How Do These Exclusions Benefit Both Landlords and Tenants?
These exclusions benefit both landlords and tenants by streamlining the eligibility process and ensuring that housing assistance is accurately targeted to those who need it most. For landlords, understanding these exclusions leads to more efficient tenant screening and compliance with HUD regulations. For tenants, it means that they are not unfairly penalized for receiving certain types of assistance, increasing their chances of securing affordable housing.
Alt: A list of HUD income exclusions including tax refunds, allowances for children of certain service members, ABLE account distributions, and emergency rental payments.
2. Newly Added Income Exclusions by HUD
2.1. Overview of the Four New Income Exclusions
HUD recently added four new income exclusions to its list, further refining the income assessment process for Section 8 housing eligibility. These include specific tax refunds, allowances for children of certain veterans, distributions from Achieving a Better Life Experience (ABLE) accounts, and emergency rental assistance payments.
2.2. Tax Refunds and Their Exclusion from Income Calculation
The amount of any refund, or advance payment for a refundable credit, issued under the Internal Revenue Code is excluded from income for Section 8 eligibility. These refunds are also excluded from assets for 12 months after receipt, providing temporary financial relief without affecting housing assistance.
2.3. Allowances for Children of Certain Service Members
Allowances paid to children of specific Thailand service veterans born with spina bifida are excluded from income and assets. This exclusion complements existing allowances for children of Vietnam veterans born with spina bifida, children of women Vietnam veterans born with certain birth defects, and children of certain Korean service veterans born with spina bifida.
2.4. ABLE Account Distributions and Their Impact on Eligibility
Any amount in an Achieving a Better Life Experience (ABLE) account is excluded from income and assets. This includes distributions from and certain contributions to ABLE accounts, supporting individuals with disabilities without impacting their Section 8 housing eligibility.
2.5. Emergency Rental Payments: How They Are Excluded
Payments received by a household under the Emergency Rental Assistance Program, as part of the Consolidated Appropriations Act of 2021 and the American Rescue Plan Act of 2021, are excluded from income and assets. This exclusion ensures that families receiving temporary rental assistance can maintain their housing stability without jeopardizing their Section 8 benefits.
3. Modifications to Existing Income Exclusions
3.1. Americorps VISTA Payments: What’s Changed?
Payments to volunteers under the Domestic Volunteer Service Act of 1973 were previously always excluded. Now, such payments are included in income if the CEO of the Corporation for National and Community Service determines that the value of the payments, adjusted to reflect the number of hours served by volunteers, is equal to or greater than the federal or state/local minimum wage, whichever is greater.
3.2. Tribal Trust Settlements: Understanding the Updated Exclusion
The first $2,000 of per capita payments are excluded unless the per capita payments exceed the amount of the original Tribal Trust Settlement. This ensures that smaller payments from Tribal Trust Settlements do not adversely affect eligibility while larger payments are appropriately considered.
3.3. NAHASDA Benefits: Clarifying the Exclusion Language
The change more accurately captures the language in the United States Code that describes the exclusion of programs under the Native American Housing Assistance & Self-Determination Act, ensuring clarity and consistency in the application of these exclusions.
3.4. Individual Development Accounts (IDA): A Note on Their Current Status
Any amounts in an IDA are excluded from assets, and any assistance, benefit, or amounts earned by or provided to an individual development account are excluded from income. This exclusion was updated to clarify that an IDA is excluded from assets, and any IDA benefits are also excluded from income, though the program was defunded in 2017.
4. Comprehensive List of Federally Mandated Income Exclusions
4.1. Importance of Knowing All Exclusions
Understanding all federally mandated income exclusions is critical for accurately determining eligibility for Section 8 housing. This knowledge helps landlords and tenants avoid miscalculations and ensure compliance with HUD regulations.
4.2. Food Stamp Act of 1977: Exclusion Details
The value of the allotment provided to an eligible household under the Food Stamp Act of 1977 is excluded from income and assets, ensuring that food assistance does not affect housing eligibility.
4.3. Domestic Volunteer Service Act of 1973: Stipends and Payments
Payments for volunteers under the Domestic Volunteer Service Act of 1973 are generally excluded, except when the CEO of the Corporation for National and Community Service determines that the value of the payments is equivalent to or greater than the minimum wage.
4.4. Alaska Native Claims Settlement Act: Income Derived
Certain payments received under the Alaska Native Claims Settlement Act are excluded from income and assets, recognizing the unique financial circumstances of Alaska Native communities.
4.5. Income from Submarginal Land Held in Trust for Indian Tribes
Income derived from certain submarginal land of the United States held in trust for certain Indian tribes is excluded from income and assets, protecting the financial interests of these communities.
4.6. Low-Income Home Energy Assistance Program (LIHEAP)
Payments or allowances made under the Department of Health and Human Services Low-Income Home Energy Assistance Program are excluded from income and assets, ensuring that energy assistance does not affect housing eligibility.
4.7. Disposition of Funds to the Grand River Band of Ottawa Indians
Income derived from the disposition of funds to the Grand River Band of Ottawa Indians is excluded from income and assets, supporting the financial well-being of this tribal community.
4.8. Judgment Funds Awarded by the National Indian Gaming Commission
The first $2,000 of per capita shares received from judgment funds awarded by the National Indian Gaming Commission or the U.S. Claims Court, the interests of individual Indians in trust or restricted lands, and the first $2,000 per year of income received by individual Indians from funds derived in interests held in such trust or restricted lands are excluded from income and assets.
4.9. Student Financial Assistance Under Title IV of the Higher Education Act of 1965
Amounts of student financial assistance funded under Title IV of the Higher Education Act of 1965, including awards under Federal work-study programs or the Bureau of Indian Affairs student assistance programs, are excluded from income.
4.10. Payments Received Under Title V of the Older Americans Act of 1965
Payments received from programs funded under Title V of the Older Americans Act of 1965 are excluded from income, supporting older Americans without affecting their housing eligibility.
4.11. Agent Orange Settlement Fund Payments
Payments received on or after January 1, 1989, from the Agent Orange Settlement Fund or any other fund established pursuant to the settlement in Re Agent Orange Product Liability Litigation, M.D.L. No 381 (E.D.N.Y.) are excluded from income and assets.
4.12. Maine Indian Claims Settlement Act of 1980
Payments received under the Maine Indian Claims Settlement Act of 1980 are excluded from income and assets, supporting the financial stability of the affected communities.
4.13. Child Care and Development Block Grant Act of 1990
The value of any childcare provided or arranged (or any amount received as payment for such care or reimbursement for costs incurred for such care) under the Child Care and Development Block Grant Act of 1990 is excluded.
4.14. Earned Income Tax Credit (EITC) Refund Payments
Earned income tax credit (EITC) refund payments received on or after January 1, 1991, for programs administered under the United States Housing Act of 1937, title V of the Housing Act of 1949, Section 101 of the Housing & Urban Development Act of 1965, and Sections 221(d)(3), 235, and 236 of the National Housing Act are excluded from income and assets.
4.15. Indian Claims Commission Payments
Payments by the Indian Claims Commission to the Confederated Tribes and Bands of the Yakima Indian Nation or the Apache Tribe of the Mescalero Reservation are excluded from income and assets.
4.16. AmeriCorps Participants’ Allowances, Earnings, and Payments
Allowances, earnings, and payments to AmeriCorps participants under the National and Community Service Act of 1990 are excluded from income.
4.17. Allowances Paid to Children of Vietnam, Korean, and Thailand Service Veterans
Any allowance paid to children of Vietnam veterans born with spina bifida, children of women Vietnam veterans born with certain birth defects, and children of certain Korean and Thailand service veterans born with spina bifida are excluded from income and assets.
4.18. Crime Victim Compensation
Any amount of crime victim compensation that provides medical or other assistance (or payment or reimbursement of the cost of such assistance) under the Victims of Crime Act of 1984 received through a crime victim assistance program is excluded from income and assets.
4.19. Workforce Investment Act of 1988/Workforce Innovation and Opportunity Act of 2014
Allowances, earnings, and payments to individuals participating in programs under the Workforce Investment Act of 1988, reauthorized as the Workforce Innovation and Opportunity Act of 2014, are excluded from income.
4.20. Richard B. Russell School Lunch Act and the Child Nutrition Act of 1966
Any amount received under the Richard B. Russell School Lunch Act and the Child Nutrition Act of 1966, including reduced-price lunches and food under the Special Supplemental Food Program for Women, Infants, and Children (WIC), are excluded from income and assets.
4.21. Seneca Nation Settlement Act of 1990
Payments, funds, or distributions authorized, established, or directed by the Seneca Nation Settlement Act of 1990 are excluded from income and assets.
4.22. U.S. Department of Veterans Affairs Disability Benefits
Payments from any deferred U.S. Department of Veterans Affairs disability benefits that are received in a lump sum or in prospective monthly payments are excluded from income.
4.23. Service-Connected Disability and Dependency Indemnity Compensation
Any amounts not received by the family that would be eligible for exclusion under 42 U.S.C. §1382b(a)(7) and received for service-connected disability under 38 U.S.C. chapter 11 or dependency and indemnity compensation under 38 U.S.C. chapter 13 are excluded.
4.24. Elouise Cobell et al. v. Ken Salazar et al. Settlement Payments
A lump sum or a periodic payment received by an individual Indian under the class action settlement agreement in the case titled Elouise Cobell et al. v. Ken Salazar et al., 816 F. Supp.2d 10 (Oct 5, 2011, D.D.C), for one year from the time of receipt of that payment as provided in the Claims Resolution Act of 2010 is excluded from income and assets.
4.25. Assets for Independence Act
As provided by the Assets for Independence Act, as amended, any amounts in an “individual development account” are excluded from assets, and any assistance, benefit, or amounts earned by or provided to the individual development account are excluded from income.
4.26. Per Capita Payments from Indian Tribal Trust Settlements
Per capita payments made from the proceeds of Indian Tribal Trust Settlements listed in IRS Notice 2013-1 and 2013-55 must be excluded from annual income unless the per capita payments exceed the amount of the original Tribal Trust Settlement proceeds and are made from a Tribe’s private bank account in which the Tribe has deposited the settlement proceeds.
4.27. Disaster Relief Assistance
Individuals and families receiving federal assistance for a major disaster or emergency under the Robert T. Stafford Disaster Relief and Emergency Assistance Act and comparable disaster assistance that is provided by States, local governments, and disaster assistance organizations are excluded from income and assets.
4.28. Achieving Better Life Experience (ABLE) Accounts
Any amount in an Achieving Better Life Experience (ABLE) account, distributions from, and certain contributions to an ABLE account established under the ABLE Act of 2014 are excluded from income and assets.
4.29. Emergency Rental Assistance Program
Assistance received by a household under the Emergency Rental Assistance Program under the Consolidated Appropriates Act of 2021 and the American Rescue Plan Act of 2021 is excluded from income.
5. Practical Implications for Landlords and Property Managers
5.1. How to Accurately Calculate Income for Section 8 Applicants
Accurately calculating income for Section 8 applicants involves understanding which income sources are excluded by HUD regulations. Landlords and property managers must stay updated on the latest HUD guidelines to ensure compliance and fair assessment.
5.2. Common Mistakes to Avoid When Determining Income Eligibility
Common mistakes include failing to exclude eligible income sources, miscalculating income from part-time jobs, and not verifying income information thoroughly. Avoiding these errors ensures accurate eligibility determinations.
5.3. Best Practices for Documenting Income and Exclusions
Best practices include maintaining detailed records of all income sources, documenting exclusions with supporting documentation, and regularly updating income information. Proper documentation is essential for compliance and audits.
Alt: A person using a calculator to determine income for Section 8 applicants, showcasing the importance of accurate calculation and documentation.
6. Real-World Examples and Case Studies
6.1. Success Stories of Tenants Benefiting from Income Exclusions
One example is a single mother receiving emergency rental assistance who was able to maintain her Section 8 housing eligibility because the assistance was excluded from her income calculation. This allowed her to stabilize her housing situation while she sought long-term employment.
6.2. How Landlords Have Successfully Navigated Complex Income Scenarios
A landlord in Austin, Texas, successfully navigated a complex income scenario by thoroughly documenting all income sources and exclusions for a tenant who was receiving both Social Security benefits and payments from a Tribal Trust Settlement. By accurately calculating the tenant’s income, the landlord ensured compliance with HUD regulations and maintained a positive landlord-tenant relationship. Address: 1 University Station, Austin, TX 78712, United States. Phone: +1 (512) 471-3434. Website: income-partners.net.
6.3. Lessons Learned from Common Income Calculation Errors
One common error is failing to exclude student financial aid. A property manager learned this lesson after initially including a tenant’s student loans as income, which led to an inaccurate eligibility determination. By correcting this mistake, the property manager ensured compliance and provided the tenant with the housing assistance they were entitled to.
7. Resources and Tools for Staying Compliant
7.1. Key HUD Publications and Handbooks to Consult
Key publications include HUD Handbook 4350.3, which provides comprehensive guidance on determining income eligibility for Section 8 housing. Additionally, HUD Notices and updates offer timely information on changes to income exclusions and regulations.
7.2. Online Resources for Landlords and Tenants
Online resources include HUD’s official website, which provides access to handbooks, notices, and FAQs. Websites like income-partners.net offer additional guidance, tools, and resources for navigating Section 8 eligibility.
7.3. Training Programs and Workshops on Income Determination
Training programs and workshops, often offered by housing organizations and HUD-approved agencies, provide in-depth instruction on income determination and compliance. These programs help landlords and property managers stay updated on the latest regulations and best practices.
8. Partnering for Success: How Income-Partners.Net Can Help
8.1. Overview of Services Offered by Income-Partners.Net
Income-partners.net offers a range of services to assist landlords and tenants in navigating the complexities of Section 8 housing, including information on income exclusions, eligibility requirements, and compliance best practices. Our platform aims to connect individuals with the resources and partnerships needed to thrive in the affordable housing market.
8.2. How We Can Assist Landlords in Finding Qualified Tenants
We assist landlords in finding qualified tenants by providing resources for effective tenant screening, income verification, and compliance with HUD regulations. Our platform helps landlords identify tenants who meet the eligibility criteria for Section 8 housing, ensuring a smooth and successful leasing process.
8.3. How We Support Tenants in Understanding Their Eligibility
We support tenants by providing clear and accessible information on eligibility requirements, income exclusions, and application procedures. Our resources help tenants understand their rights and responsibilities, empowering them to navigate the Section 8 housing process with confidence.
Alt: A group of diverse individuals discussing housing opportunities, representing the collaborative approach of Income-Partners.Net in connecting landlords and tenants.
9. Future Trends in HUD Income Exclusions
9.1. Potential Changes to Income Exclusion Policies
Potential changes to income exclusion policies may include updates to reflect economic conditions, legislative changes, and evolving needs of low-income families. Staying informed about these changes is crucial for maintaining compliance and ensuring fair access to affordable housing.
9.2. The Impact of Economic Conditions on Housing Assistance
Economic conditions can significantly impact housing assistance programs, with changes in employment rates, inflation, and government funding affecting eligibility requirements and the availability of resources. Monitoring these trends is essential for anticipating future changes in HUD regulations.
9.3. How to Stay Informed About Updates and Changes
Staying informed about updates and changes involves regularly consulting HUD’s official website, subscribing to industry newsletters, and participating in training programs and workshops. Additionally, partnering with organizations like income-partners.net can provide access to timely information and expert guidance.
10. Frequently Asked Questions (FAQs) About HUD Income Exclusions for Section 8
10.1. What is considered income for Section 8?
Income for Section 8 includes wages, salaries, tips, Social Security benefits, unemployment compensation, and other regular sources of financial support.
10.2. What is not considered income for Section 8?
Certain sources are excluded, such as tax refunds, allowances for children of veterans with disabilities, distributions from ABLE accounts, and emergency rental assistance payments.
10.3. How often does HUD update its income exclusion list?
HUD updates its income exclusion list periodically to reflect changes in legislation, economic conditions, and program requirements.
10.4. Where can I find the most current list of HUD income exclusions?
The most current list can be found on HUD’s official website and in HUD Handbook 4350.3.
10.5. What happens if I miscalculate income for a Section 8 applicant?
Miscalculating income can lead to inaccurate eligibility determinations, potentially resulting in non-compliance and penalties.
10.6. Are student loans considered income for Section 8?
Generally, student loans are not considered income for Section 8, but it’s important to verify the specific details with HUD guidelines.
10.7. How do I verify income for Section 8 applicants?
Income can be verified through pay stubs, tax returns, Social Security statements, and other official documents.
10.8. What is an ABLE account, and how does it affect Section 8 eligibility?
An ABLE (Achieving a Better Life Experience) account is a savings account for individuals with disabilities. Distributions from ABLE accounts are excluded from income and assets for Section 8 eligibility.
10.9. Are payments from the Emergency Rental Assistance Program counted as income?
No, payments received under the Emergency Rental Assistance Program are excluded from income and assets for Section 8 eligibility.
10.10. Where can I get help with Section 8 income calculations?
Help with Section 8 income calculations can be obtained from HUD-approved agencies, housing organizations, and resources like income-partners.net.
Understanding what income is excluded from HUD for Section 8 is essential for landlords and tenants alike. By staying informed about the latest regulations and utilizing available resources, you can navigate the complexities of affordable housing with confidence. Partner with income-partners.net today to discover the opportunities and strategies that can help you thrive.
Ready to take the next step? Visit income-partners.net to explore our comprehensive resources, connect with potential partners, and gain the knowledge you need to succeed in the dynamic world of affordable housing. Don’t miss out on the chance to build valuable relationships and unlock new opportunities for growth.
