602-3 A.     EARNED INCOME

1. Wages

a. Definition:  

Earned income includes, but is not limited to:  monetary compensation for services as an employee, including gross earned income, advances, tips (as reported by the employee) and commissions; military pay; and earnings from on-the-job training programs under the Workforce Investment Act.

Income from babysitting, housekeeping, craft sales, fishing, etc. is considered wages unless the applicant is claiming self-employment. See MS 605-2D for determining self-employment income.

b. Verification:   

Acceptable verification includes, but is not limited to, employer's statement which is signed and dated, employer's wage record, paycheck stub, military Leave and Earnings Statement ( LES ), pay envelope, collateral contact or employee's W-2 form.

c. Budget:   

Wages are counted as income in the month received or expected to be received.  Earned income received as a single monthly payment will be considered received in the month the income is normally received when mailing cycles or payment schedules cause two paychecks to be received in one month.  Late or retroactive payments are considered nonrecurring lump-sum payments.  See MS 602-3D(13).  For budgeting military income see MS 605-2E.

2.  Flexible Health Benefits

If the employer pays flexible health benefits on behalf of the employee and the employee must use this money to purchase health insurance, only the amount that goes directly to the employee (benefit contribution excess) is counted when determining a household’s gross income. Any amount that the employer pays for mandatory health insurance benefits that the employee does not receive in addition to their regular pay is not counted as income to the employee.

3. Jury Duty Payments and Witness Fees

Jury duty payments and witness fees count as earned income in the month received or expected to be received.  Any portion of a jury duty payment or witness fee that is designated as a reimbursement for items such as food, lodging, parking or transportation is excluded income.  See MS 602-3D(15).  

4. Employees Working on Contract

Persons who are employed under a contract and are not paid for their contractual work on at least a monthly basis will have their earnings prorated over the number of months covered by the income.  However, any draws or wages received in advance of the contractual earnings are treated as earned income in the month received or expected to be received.
 

The months covered by the contractual income are the months in which the employee is actually working under the terms of the contract.

5. Government Sponsored Training Program Payments

Income received from government sponsored training programs, including training allowances from vocational and rehabilitation programs such as from the Division of Vocational Rehabilitation and Compensated Work Therapy payments funded by the Veteran’s Administration are countable earned income. Any portion that is a reimbursement for past or future non-household expenses is excluded income.  See MS 602-3D(15) for policy on reimbursements.

6. Self-Employment Income

a. Definition:   

Self-employment includes occupations such as small business, crafts, boarding house manager/owner, ownership of rental property (in which the household member is actively managing the property a minimum of 20 hours a week) and seasonal self-employment such as fishing.  See MS 605-2D.

b. Verification:   

The applicant is responsible to verify all income and expenses claimed. Acceptable sources of verification are tax records, bookkeeping records, and account statements. Written or verbal verification of self-employment income and expenses is required  See MS 605-2D (4).

c. Budget:   

For budgeting self-employment income see MS 605-2D.