June 21, 2016
Credit to Lucy Axton Miller of the the VCU National Training and Data Canter for providing this source.
What is the EID?
The Earned Income Disregard (EID) enables certain family members with certain HUD rental subsidies to go to work without having the family’s rent increase immediately. The rent increase is phased in.
Who Is Eligible for the EID?
- Adults with and without disabilities in public housing
- Adults with disabilities who receive assistance from the:
- Housing Choice Voucher program,
- HOME Investment Partnerships program,
- Housing Opportunities for Persons with AIDS (HOPWA) program, or
- Project-Based Section 8 Voucher (but not other project-based Section 8 programs)
When Does the EID Apply?
The EID applies in any of three situations:
- When an adult family member is newly employed and the family’s income increases as a result. The member must have been previously unemployed or minimally employed (earning no more than the equivalent of 500 hours at the local minimum wage) during the year before the new employment starts; or
- When an adult family member has an increase in earnings during participation in a self-sufficiency or other job training program (which may include employment counseling, work placement, basic skills training, education, English proficiency, workfare, financial or household management, apprenticeship, community college, substance abuse or mental health treatment program, etc.), and the family’s income increases as a result; or
- When an adult family member is newly employed or increases his or her earnings during (or within 6 months after) receiving TANF-funded assistance (including one-time payments, wage subsidies and transportation aid totaling at least $500 in a 6-month period), and the family’s income increases as a result.
The EID also applies to a family member who reaches age 18 and meets one of the above 3
How Does the EID Work?
When a family member qualifies for the EID, the increase in family rent resulting from the new
or increased earnings is delayed in two phases:
1. During the first 12 months of the EID, the increase in family income resulting from the new or increased earnings is fully excluded. As a result, the family’s rent does not increase due to the earnings for the first 12 months of work. The 12 months are not necessarily consecutive, if the member does not work every month.
2. During the second 12 months of the EID, 50% of the increase in family income resulting from the new or increased earnings is excluded. The family’s rent increases, but only half as much as if all the increase in income were counted. The 12 months are not necessarily consecutive, if the member does not work every month.
The 24 months of the EID must be used within 24 consecutive months, starting with the first
EID month. If not all 24 months have been used within the 24-month period, the EID is still
exhausted. The EID ends with the earlier of:
- The first 24 months of paid work/increased earnings, or
- The end of the 24-month period starting with the first EID month.
After the EID has been used up, the exclusion of earnings ends. The family’s rent is computed
based on family income, including all of the earnings.
Mephisto is 37 years old. He receives $733 per month from SSI and lives alone with a Housing Choice Voucher. He has not worked in over 12 months. He pays $209.90 per month for rent including utilities ($733 SSI – $33.33 disabled family deduction = $699.67 x 30% = $209.90). He starts a job earning $10 per hour working 30 hours per week (an average of $1,300 per month gross wages). On average, his SSI payment is reduced to $125.50 per month.
Mephisto qualifies for the EID. During the first 12 months, the increase in his income resulting from his earnings is fully excluded. His rent and utility payment remains $209.90 per month.
During the second 12 months, 50% of the increase in his income is excluded. His income increase is $692.50 ($1,300 wages + $125.50 reduced SSI = $1,425.50 – $733 original SSI). 50% of $692.50 is $346.25. Mephisto’s rent increases to $313.78 ($1,300 wages + $125.50 reduced SSI – $346.25 excluded income increase – $33.33 disabled family deduction = $1,045.92 x 30% = $313.78) after his next rent reexamination.
Mephisto uses up his EID after 24 months. Now all his earnings are included in the rent calculation. After his next redetermination, his rent increases to $417.65 ($1,300 wages + $125.50 SSI – $33.33 disabled family deduction = $1,392.17 x 30% = $417.65)
For more information about the EID, refer to the HUD website here: