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What is unearned income?

Produced by Patricia Baker and Victoria Negus
Reviewed January 2020

Most sources of unearned income are counted in calculating your SNAP benefits. 106 C.M.R. §363.220(B). Unearned income is counted 100%, which means you do not receive the 20% earned income disregard.

Countable unearned income includes:
■ Needs-based cash assistance including TAFDC, EAEDC, SSI and Veterans Services (Chapter 115) benefits. 106 C.M.R. §363.220(B)(1).
■ Cash benefits based on past earnings or service, including Unemployment Insurance, Workers Compensation, Social Security, federal Veteran’s benefits, and other pension benefits. 106 C.M.R. §363.220(B)(2).
■ Foster care payments received for a child or disabled adult who is included in the SNAP household. These payments are not countable if you opt out this individual from the SNAP household. 106 C.M.R. §§361.240(F). 363.220(B)(2). See Questions 43 and 44.
■ Child support and any income from trusts, alimony or other sources paid directly to you. Child support payments made to TAFDC recipients that must be assigned to the Department of Revenue (DOR) are not countable, even if erroneously received by the TAFDC household. 106 C.M.R. §§363.220(B)(3), (C)(6).
■ Interest payments, dividends, royalties paid from your assets, or other direct money payments. 106 C.M.R. §363.220(B)(4). These monies still count as income, even though the assets themselves do not count. Capital gains from the sale of personal assets are excluded as nonrecurring lump sum income in most situations.
■ Certain non-federal post-secondary educational loans, grants, scholarships that can be used for current living expenses. 106 C.M.R. §363.230(D). See question 45 and 69. Most federal educational monies, including federal work study, are non-countable.
■ TAFDC or EAEDC benefits diverted to a landlord or other third party vendor payments. 106 C.M.R. §§363.220(C)(2), (C)(3).
■ The portion of a TAFDC, EAEDC or SSI grant that is deducted because an individual was sanctioned or is repaying an overpayment due to an intentional failure to comply with requirements of these programs. See question 77.

Advocacy Reminders

  • DTA can use government databases to verify a number of income sources such as Social Security (RSDI), Supplemental Security Income (SSI), MA Unemployment Benefits and child support that is paid to a family through the Department of Revenue (DOR). DTA should use these databases to verify unearned income and not ask you to produce a written statement about the benefit amount unless there is a discrepancy between what you reported and what the databases say.
  • Unearned income that is “recouped” for an overpayment is often not countable. See question 77.

DTA Online Guide Sections: SNAP > Eligibility Requirements > Income >Other Income (Unearned) > Other Income Introduction (Unearned)

Additional Guidance:
●Pension or retirement savings account withdrawals that are more frequent than one time withdrawals are likely countable as unearned income. Interest income is also countable. Hotline Q&A (Feb 2014)
● State Veterans’ Services Benefits (VSB) considered countable unearned income but certain portions may be excluded—if vender payments are made by VSO, etc. Transitions Hotline Q&A (May 2013). See also DTA’s Massachusetts SNAP Veterans Guide, issued in 2019.

 

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