Definitions and Elements of Annual Family Income

  1. Annual income shall be calculated with reference to 24 C.F.R  5.609, and includes, but is not limited to, the following:
    1. The full amount, before any payroll deductions, of wages and salaries, overtime pay, commissions, fees, tips, bonuses and other compensation for personal services;
    2. The net income from operations of a business or profession, before any capital expenditures but including any allowance for depreciation expense;
    3. Interest, dividends, and other net income of any kind from real or personal property;
    4. The full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits or other similar types of periodic payments;
    5. Payments in lieu of earnings, such as unemployment and disability compensation, worker’s compensation, and severance pay;
    6.  Welfare assistance. If the welfare assistance payments include an amount specifically designated for shelter and utilities that is subject to adjustment by the welfare assistance agency in accordance with the actual cost of shelter and utilities, the amount of welfare assistance to be included as income consists of the following:
      1. The amount of the allowance exclusive of the amounts designated for shelter or utilities, plus
      2. The maximum amount that the welfare assistance agency could in fact allow the family for shelter and utilities;
    7. Periodic and determinable allowances, such as alimony and child support payments, and regular contributions or gifts received from persons not residing with the Applicants (e.g. periodic gifts from family members, churches or other sponsored group, even if the gifts are designated as rental or other assistance);
    8. All regular pay, special pay and allowances of a member of the armed forces;
      1. Any assets not earning a verifiable income shall have an imputed interest income using a current average annual savings interest rate.
  2.  Excluded from the definition of family annual income are the following:
    1. Income from employment of children under the age of 18;
    2. Payments received for the care of foster children;
    3. Lump-sum additions of family assets, such as inheritances, insurance payments, capital gains and settlement for personal or property losses;
    4. Amount received that are specifically for, or in reimbursement of, the cost of medical expense for any family member;
    5. Amounts of educational scholarships paid directly to the student or to the educational institution, and amounts paid by the government to a veteran in connection with education costs:
    6.  Amounts received under training programs funded by HUD;
    7. Food stamps; and
    8. Temporary, nonrecurring or sporadic income (including gifts that are not regular or periodic).
  3. Net family assets for purposes of imputing annual income include for following:    
    1. Cash held in savings and checking accounts, safety deposit boxes, etc.;
    2. The current market value of a trust for which any household member has an interest;
    3. The current market value, less any outstanding loan balance of any rental property or other capital investments;
    4. The current market value of all stocks, bonds, treasury bills, certificate of deposit and money market funds;
    5. The current value of any individual retirement, 401K or Keogh account;
    6. The cash value of a retirement or pension fund which the family member can withdraw without terminating employment or retiring;
    7. Any lump-sum receipts not otherwise included in income (i.e., inheritances, capital gains, one-time lottery winnings, and settlement on insurance claims);
    8. The current market value of any personal property held for investment (i.e., gems, jewelry, coin collections); and 
      1. Assets disposed of within two (2) years before the Application Date, but only to the extent consideration received was less than the fair market value of the asset at the time it was sold.
  4. Net family assets do not include the following:
    1. Necessary personal property (clothing, furniture, cars, etc.);
    2. Vehicles equipped for handicapped individuals;
    3. Life insurance policies;
    4. Assets which are part of an active business, not including rental properties; and
    5. Assets that are not accessible to the Applicant and provide no income to the Applicant.