Budgeting

Revised November 26, 2019

Purpose:

This section contains cash, medical and Basic Food rules and procedures for budgeting income.

WAC 388-450-0215 How does the department estimate my assistance unit's income to determine my eligibility and benefits?

WAC 388-450-0225 How are my assistance unit's benefits calculated for the first month I am eligible for cash assistance?

WAC 388-450-0230 What income does the department count in the month I apply for Basic Food when my assistance unit is destitute?

WAC 388-450-0162 for the definition of countable income and its effect on eligibility.

Worker Responsibilities and Clarifying Information using above WACS. 

WAC 388-450-0245 When are my benefits suspended?

• Clarifying Information

Worker Responsibilities 

The following topics are discussed below:

• Recording Hours of Employment
• Best Estimate
• Averaging
• When AM Must Be Used to Budget Income
• Month of Application
• Client Choice
• Special Circumstances for Budgeting Income and Expenses
• Budgeting Income for Medical Programs
• Budgeting Deductions
• Effect of Incorrect Estimates
• Determining the Effective Date When a Client's Income Causes Them to be Ineligible

Recording Hours of Employment

For WorkFirst, Working Family Support (WFS), and Able-Bodied Adults Without Dependents (ABAWD) cases, we must verify and record the anticipated hours that a person will be working in the same manner that we budget anticipated income. We use ACES 3G (not eJAS) data to claim employment hours towards meeting the federal TANF work participation rate, to help determine who qualifies for WFS, and for ABAWD Basic Food eligibility.

Treat in-kind income, such as working in lieu of paying some or all of one's rent, as employment, verify the hours and enter the hours into ACES 3G. See separate instructions below for how to code self-employment (SE) hours.

ACES 3G automatically records and reports employment hours from the ongoing month forward. See the following links for information about how to record and report employment hours in historical months from the employment start date.

• Regular employment - WorkFirst Handbook section 8.1.4
• Community Jobs - WorkFirst Handbook section 8.3.12

Note:  Community Jobs pays the state or local minimum wage, whichever is higher.

For employed WorkFirst, WFS, or ABAWD, we record:

• The best estimate of the actual hours we expect the person to work each month when we budget their anticipated income using the Anticipate Monthly (AM) method; or
• An average monthly amount of hours using the Combined Average (CA) budgeting method and the person’s pay frequency; and
• The actual date the person’s work began, particularly for new jobs.

For self-employment, ACES 3G uses SE data to calculate the average weekly hours of SE and display that information in eJAS.

• ACES 3G applies the 50% SE expense standard deduction or use the participant's allowable, verified business expenses, as appropriate, to determine the amount of the cash grant without any action on your part. Only enter verified business expenses on the ACES 3G EARN screen. ACES treats all SE earned income expense types as actual business expenses.
• Self-employment formula to calculate federally countable PT or FT participation hours:

1. ACES 3G subtracts the participant's allowable, verified business expenses or the 50% SE expense standard deduction, whichever is greater, from her or his gross monthly business receipts.
2. Divide the result by the federal minimum wage ($7.25/hour).
3. The result is the number of self-employment hours per month.
4. Divide the number of hours per month by 4.33.
5. The result is the number of hours per week.

Steps to arrive at the best estimate of the client's income

1. During the interview process, identify all sources of earned and unearned income that are:
   1.  Owned by the client; and
   2. Available to the client.
2. Subtract any income excluded or disregarded; and
3. Budget the income remaining using the appropriate calculation method based on the client's choice or the requirements of WAC 388-450-0215.

How to determine the best estimate of a client's income and hours

The best estimate of a client's income and hours is:

1. What hours you can reasonably expect a client to work (including overtime hours); and
2. What income is reasonably expected to be received for the pay period frequency?

Averaging

Use the Combined Average (CA) method in ACES 3G to calculate income when clients expect their income to change from month to month, but want their benefits to stay the same. The income we budget and hours we estimate will depend on the frequency that the person is paid.

It may be appropriate to use past wage stubs to do the averaging if it represents what the client expects to receive. In certain situations, such as new employment or recent changes in the client's rate of pay or work hours, it may be more appropriate to use an estimate from the employer.

1. Estimate the income and hours per pay period as follows:
   1. If using wage stubs:
      1. Total the gross income from all pay periods where the income represents what the client should receive; and
      2. Divide by the number of pay periods used in step (i).
   2. If using an employer statement, take the anticipated weekly amount and:
      1. Multiply by 1 if paid weekly.
      2. Multiply by 2 if paid biweekly (every other week).
      3. Multiply by 52 weeks per year and divide by 24 pay periods if paid twice a month.
      4. Multiply by 52 weeks per year and divide by 12 pay periods if paid once a month.
2. Enter the result from step (1)(a) or (1)(b) on the EARN screen in ACES 3G using the CA method and the appropriate pay frequency.
   1. To get the monthly amount, ACES 3G will take the amount from step (1)(a) or (1)(b) and:
      1. Multiply by 4.3 if paid weekly.
      2. Multiply by 2.15 if paid biweekly (every other week).
      3. Multiply by 2 if paid twice a month.
      4. Multiply by 1 if paid monthly.

To find information on entering income and work hours in ACES 3G, see Income Eligibility and Budgeting – (EARN) Earned Income Screen

When AM Must Be Used to Budget Income

1. For Basic Food only, if an AU is destitute under WAC 388-406-0021:
   1. Use AM for the month of application. If you do not have to use AM for any other reason, you may use either AM or averaging for the remainder of the certification period.
   2. Provide expedited service if available cash resources are $100 or less under WAC 388-406-0015.
   3. See WAC 388-450-0230 to determine if we exclude any of the AUs income for the month of application.
2. AM and SSI-related medical:
   1. Use AM to budget all of the client’s income if:
      1. A client receives SSI-related medical; or
      2. The AU has income allocated to someone receiving SSI-related medical. The following program codes in ACES 3G require AM:
         

         G	G03, G95, G99
         L	L01, L02, L04, L21, L22, L95, L99
         S	S01, S02, S03, S04, S05, S07, S08, S95, S99

3. For clients in the same Basic Food AU with someone receiving SSI, you don't have to use AM to budget the income of the client who doesn't:
   1. Receive SSI-related medical;
   2. Have income allocated to someone receiving SSI-related medical; or
   3. Meet any of the other requirements to use AM under WAC 388-450-0215.

    4. When clients get SSI, but no one in the AU gets SSI-related medical:

Budget SSI and Social Security income using AM. If there is no other situation that requires us to use AM, use either method for the other sources of income.

Month of Application

1. AM method is not required
   1. With the exception of those in subsection (5) of WAC 388-450-0215, you do not have to obtain or budget actual income the household has already received in the month of application if you have enough information to reasonably estimate the client's income by averaging.
2. Conversion of Income
   1. If a client is paid weekly or biweekly and you convert the income using 2.15 or 4.3 method, you must also convert in the month of application, unless:
      1. A full months' income is not anticipated in the month of application. In this situation, budget AM in the month of application and average the income for the rest of the certification period.
      2. The client chooses to use the AM method. If we use AM in the month of application, we must also use it for the rest of the months in the certification period. See Client Choice for more information.

Client Choice

1. If you don't have to use AM, clients can choose either budgeting method unless the client is paid less often than monthly, such as quarterly or yearly. In this situation, we must average the income.
2. If a client has more than one source of income, the budgeting method for each source does not have to be the same. For example, if a client has two different jobs, you can use AM for one job and CA for the other.
3. The client's choice should be guided by whether:
   1. They want their benefits to remain consistent through the certification period; or
   2. They want their benefits to change based on anticipated changes in income and hours.
4. Sometimes the client's circumstances make AM a likely choice, such as when they:
   1. Have stable income such as a regular monthly salary;
   2. Are paid daily;
   3. Expect several changes at different times within the month (e.g. regular hours for the first week, no hours for the second week due to unpaid leave, raise in wages on the third week); or
   4. Expect to get less than a full month's income due to the beginning or end of a source of income.
5. There are times when one method will be more beneficial to the client. If a client is ineligible using one method, review the case to see if the client would prefer another method.
6. Calculation methods cannot be changed during a certification period just to maximize a client's benefits. Changing calculation methods to give a client more benefits does not result in the best estimate of the client's income and hours for the entire certification period. Changes in methods may occur at:
   1. Application, eligibility review, or recertification; and
   2. During a certification period only when the client reports a change that was not considered in the original estimate.
7. When a client is paid biweekly and chooses AM, we adjust the client's case for anticipated changes through the certification period as follows:
   1. Determine which months the client will receive an extra check;
   2. Set a tickle with enough time to budget the extra check for that month;
   3. Give advance and adequate notice to the client.
8. If a client reports a change in their income and hours, take the following steps:
   1. Determine if the change will last at least a month beyond the date the client reported the change;
   2. If so, re-calculate this source of income.
   3. Document the change and whether or not it is expected to last at least a month beyond the month the change was reported.
   4. Record the actual job start date in ACES 3G. This will allow us to report employment hours for all of the time the client has been working.

Special Circumstances for Budgeting Income and Expenses

1. Self Employment. See:

• Calculating Self Employment Income- For Basic Food Benefits
• Calculating Self Employment Income - For TANF, SFA, PWA, ABD, MCS, and Family Medical
• Calculating Self Employment Income – For Children’s and Pregnancy Medical Programs
• Calculating Self Employment Income – For SSI Related Medical

2. Clients that receive their annual income over a timeframe less than a year under contract:
   1. When a client gets their annual income over a period of less than a year as a part of the client's employment contract, average their annual income and hours over a 12-month period unless the client is:
      1. A migrant or seasonal farmworker; or
      2. Paid on an hourly or piecework basis.
3. Other contract income:
   1. If a client's income that is paid under contract is not the client's annual income (yearly), we average the income over the period of time the contract income covers unless the client is:
      1. A migrant or seasonal farmworker; or
      2. Paid on an hourly or piecework basis.
   2. Examples of employees that may receive their income under contract include:
      1. School Employees;
      2. Bus Drivers;
      3. Farmers; and
      4. Fishers.

4. Budgeting the earned income of a child turning age 18:
   1. Count or exclude the earned income of a child according to WAC 388-450-0070. For cash assistance, consider a client to be a child if they meet the requirements of WAC 388-404-0005.
   2. We use a child’s age on the first day of the month as the child’s age for that month.

5. Budgeting child support that fluctuates :

You can use either AM or CA to budget child support you expect a client to receive. Determine the amount to budget based on what you can reasonably expect knowing the client's current support, what they received in the past, and changes that you anticipated changes. Document your decision.

When you know of a change in child support income, decide if the new amount is something you can expect to continue or if the original estimate was valid.

1. If the support is paid through DCS, you can contact DCS and the client to determine if:
   1. There was a change that would impact your estimate for the monthly support (such as a new support order); or
   2. The change could be explained by some short-term situation such as:
      1. Job changes, with a lag between the start of the job and the start of the payroll deduction for support;
      2. Was making larger payments for a period of time to pay arrears, and is now caught up; or
      3. Was off work for a period of time and DCS was unable to collect support.
2. If the support is not paid through DCS, you can contact the client and request information to help determine why the support changed.

6. Budgeting additional cash assistance payments for Basic Food: If a cash supplement is issued due to a change in income or expenses, do not budget the additional cash against the Basic Food without ten days’ notice.
   1. When issuing a cash and Basic Food supplement due to adding a person to both AUs, include the cash supplement when determining the Basic Food supplementary amount for that month.
7. Budgeting a client's partial Unemployment Compensation:  Refer to ESD's Earnings Deduction Chart to budget anticipated   ongoing unemployment benefits when a client is expected to receive partial unemployment compensation.

See LETTERS for information on timely and adequate notice.

Budgeting Income for Medical Programs

1. Budget the income the client received or expects to receive for the month of application. 
2. Use the income you can reasonably expect the client to receive for the month(s) you authorize medical care.
3. See WAC 388-418-0020 - How the department determines the date a change affects my benefits, and WAC 182-504-0125 - Effect of Changes on Medical, for changes in income after certification.

Budgeting Deductions

1. Budget allowable expenses for the month you expect the client to have the expense using AM budgeting or an offline average. Dependent care expenses can be converted using ACES 3G.
2. See INCOME - Effect on Eligibility and Benefit Level to determine if an expense is allowed as a deduction for cash or Basic Food.
3. Refer to the ACES User Manual for information on entering expenses for deductions.

Effect of Incorrect Estimates

1. When clients receive less income than estimated, do not supplement benefits unless you made an error in calculating the client’s benefits.
2. If a TANF/SFA-eligible assistance unit receives less income than you anticipated, see EMERGENCY ASSISTANCE to determine if this created an emergent need and if the client may be eligible for AREN.

Determining the Effective Date When a Client's Income Causes Them To Be Ineligible

For information regarding changes that cause ineligibility, see WAC 388-418-0020.

See WAC 388-406-0055 for the effective date of eligibility for cash assistance applications.

See WAC 388-450-0162 for the definition of countable income and its effect on eligibility.

Clarifying Information

1. Count only income received between the first of the month and the date of application. Do not count any income from a new source that is anticipated after the date of application.

2. If a client receives money after the date of application, and this money is not from a new source, the client is not destitute under WAC 388-406-0021. In this case, we budget the actual amount the client received from the date of application to the date of the client's interview as well as the income we estimate the client will receive for the remainder of the month.
3. Apply the above procedures at initial application and recertification, but only for the first month of each certification period. At recertification, disregard income from a new source in the first month of the new certification period if income of more than $25 will not be received from this new source by the 10th calendar day after the date of the AU's normal assistance cycle.

Clarifying Information - WAC 388-450-0245 

Some situations that could lead to a suspension of benefits include when:

1. Use AM for a client paid weekly or every-other week and they receive an extra periodic check;
2. Clients get pay from an additional temporary job;
3. Clients get overtime pay;
4. Clients get one-time income such as a bonus on individual performance; and
5. Clients get a quarterly payment from an investment.

ACES 3G Procedures 

• See Income Eligibility and Budgeting – (EARN) Earned Income Screen
• See Interview - EDOC
• See Interview - (UNER) Unearned Income Screen - EXTRA field
• See Change of Circumstances