The Earned Income Disregard

Many housing programs have a rule called the Earned Income Disregard (EID) that lets people with disabilities who start working continue to pay the same amount for their rent or mortgage for a year, regardless of your income. With an EID, you don’t have to worry that your housing benefit, such as Section 8, will change or that your rent will go up immediately if you get a job.

With an Earned Income Disregard, if you get a job, the money you make at your job won’t be counted by your Public Housing Authority (PHA) for the first year after you start working. That means your rent won’t go up. During the second year after you start working, only half of your work income will be counted, so your rent won’t go up as much as it otherwise would. After the second year, your entire income will be counted.

To qualify for an Earned Income Disregard, you or a family member must have a disability and be in one of the following programs:

  • Section 8
  • Public Housing
  • HOME Investment Partnerships Program
  • Supportive Housing Program
  • Housing Opportunities for Persons with AIDS (HOPWA)

There are a few details to keep in mind. The only way to qualify for an EID if you are in the Section 8 Housing Choice Voucher Program is if it is a family member with a disability who has increased their earnings. That family member could be you or someone else who lives in the house, but they must have a disability.

For public housing, the family may qualify for an EID if any family member has increased earnings, as long as at least one member of the family has a disability.

Note

Increased earnings can mean one of two things.

1. You increase your earnings when you go from being unemployed to employed.

2. You increase your earnings when you get a raise at work.

Any increase counts!

You or your family must also meet one of the following requirements:

  • When you or your family member increase your earnings by getting a job, that must be the first job you or your family member has had in a year or more.
  • In the year before your increase in income, your total family income must have been less than the Public Housing Authority (PHA) income limit for your area. (You can find out the exact income limit for your PHA by giving them a call.)
  • In the six months before you or your family member got a new job, your family must have been receiving TANF Cash Assistance or been participating in a jobs program through TANF Cash Assistance.
  • You or your family member must have gotten your job while participating in a job-training or self-sufficiency program.
Example

Beverly has an apartment that costs $800 a month in rent. Thanks to her Section 8 Housing Choice Voucher Program, she only pays $100 a month, while Section 8 pays the rest. She just got a new job where she makes $1,000 each month in income.

She’s excited about the job, but is concerned that her rent will go up. If she has to pay the full $800 herself, that won’t leave much money for the other things she needs. She goes to talk to her case worker at her local Public Housing Authority (PHA). The worker tells her that because she has a disability, she qualifies for an Earned Income Disregard (EID). Because the PHA won’t count her income, Beverly will continue to pay the same amount for her apartment, $100, even though her income has gone up.

A year passes, and Beverly is doing well at her job. The PHA reviews Beverly’s situation, including her income, and decides it is time to start counting half of the money she makes at work as income when calculating her Section 8 benefit. They count $500 of her earnings, not all $1,000.

Considering her $500 in earnings per month, Beverly has to pay 30% of that as rent on her apartment, which equals $150 ($500 x 30%). This is in addition to the original $100 she was paying before she got her job. So her new rent is $250 ($100 + $150).

For more information about the Earned Income Disregard, talk to your housing authority or to a Work Incentive Consultant.