Understanding the 100% Earned Income Disregard

100% Earned Income Disregard Overview

The 100% earned income disregard (EID) is a TAFDC rule that allows DTA to not count any of the earned income for certain active TAFDC parents and caregivers for twelve cyclical payments, when the total household income is below 200% of the Federal Poverty Level (FPL). 

The 100% earned income disregard was created as an incentive to work and to help parents and caregivers gain economic mobility before leaving TAFDC. Disregarding 100% of their earned income up to 200% of the FPL, allows families to use the supportive services offered with TAFDC while they increase their income and assets and build their employment history. This can increase the family’s potential for making a smooth transition from assistance when their TAFDC closes.

Parents and caregivers must be informed that the 100% EID only applies to TAFDC. Earnings are countable for SNAP using Earned Income Deduction procedures. This allows them to make an informed decision as to whether they want to:

  • keep the TAFDC open with the 100% EID or
  • close the TAFDC and keep the SNAP benefit at the Transitional Benefit Alternative (TBA) amount.

It is critical that you explain to both exempt and non-exempt parents and caregivers the opportunity that the 100% Earned Income Disregard provides:

  • at application,
  • at reevaluation, and 
  • when they report new employment.

Case managers and engagement staff must encourage parents and caregivers to make the most of the 100% Earned Income Disregard period by obtaining more hours or more gainful employment.

Which Parents and Caregivers can Receive the 100% Earned Income Disregard?

The 100% earned income disregard is available to all TAFDC grantees, other parents and dependents who are part of the TAFDC assistance unit (AU) and have earned income that is less than 200% of the FPL, when combined with the other countable income for the TAFDC household, unless they:

  • have reduced or terminated employment without good cause within 30 days, or
  • have already received twelve cyclical payments with the 100% EID and:
    • the previous TAFDC case was not closed for 30 days or more, and 
    • the earnings are not from a different employer than when the previous twelve cyclical payments of the 100% EID were received.

Note: Dependents in the TAFDC AU who have earnings will receive the dependent earned income disregard unless they are aged 16 or older and are not enrolled in school. In this case, they can receive the 100% EID for 12 cyclical payments.

Each eligible AU member can receive their own 12 cyclical TAFDC payments with the 100% EID.

Note: The 100% EID does not apply at application, however if the parent or caregiver has earnings that are low enough to qualify for TAFDC with the $200 Work Related Expense deduction, the 100% EID will be applied when the case is approved, if they are eligible for it. If the parent or caregiver received TAFDC in the past four months the 50% EID will also be applied to determine initial eligibility.

See Earned Income Disregards and Counters-TAFDC.

Which Parents and Caregivers Cannot Receive the 100% Earned Income Disregard?

In addition to parents and caregivers indicated in the two exceptions noted above, the 100% EID is not available to:

  • otherwise eligible individuals who are sanctioned,
  • stepparents, parents of minor parents or other ineligible household members such as SSI recipients, and
  • ineligible non-citizens.

In addition, parents and caregivers in the following situations are not eligible for the 100% earned income disregard:

  • those who did not report the earnings timely without good cause. In this instance good cause is limited to the serious illness of the parent or caregiver or their dependent child), and 
  • those who decreased their income or quit their job without good cause or refused a job offer without good cause. See Good Cause for TAFDC Rules.

If the parent or caregiver meets any of the circumstances noted above, you must discuss the circumstances with them to determine if good cause exists. You must also document your efforts to discuss potential good cause in the narrative.

ExampleExampleLeslie (she/her) has an active TAFDC case for herself, her spouse and her three children. Her spouse is not receiving a benefit because he is an ineligible noncitizen. Leslie submitted a pay stub for her spouses new employer. Because her spouse is not included in the TAFDC grant, he is not eligible for the 100% EID. His earned income will be calculated using deemor rules. 

See Deemed Income-TAFDC

What Happens When Earned Income is Entered?

The 100% EID only applies to TAFDC. Earnings are countable for SNAP using Earned Income Deduction procedures for SNAP.

When a TAFDC parent or caregiver reports new earned income, you must explain the impact to the SNAP benefits in a combo case and give them a choice as to whether they would prefer to:

keep the TAFDC benefit with the 100% Earned Income Disregard and the reduced SNAP, or

complete a voluntary withdrawal of the TAFDC and receive the Transitional Support Services once the TAFDC is closed for 30 days.

if no sanctions exist, the parent or caregiver will also be eligible for Transitional Benefits Alternative (TBA) SNAP in a combo case.

The option to close the TAFDC case is especially important for families who reside in subsidized housing, including public housing. This is because most housing programs do not count SNAP benefits as income, but the TAFDC is countable income for these programs.

Important: If the parent or caregiver would like to close the TAFDC to receive TBA and TSS, the voluntary withdrawal must be completed with the same Interview Wrapup that includes the entering of the earned income to maximize the outcome for the family. This can be completed with a telephonic signature.

See Telephonic Signature, Transitional Benefits Alternative Overview, and Transitional Support Services-TAFDC

Can the Parent or Caregiver Choose not to use the 100% Earned Income Disregard?

No, the parent or caregiver cannot choose not to use the 100% EID and you may not suspend the 100% EID for this reason, but they can choose to close their case. When you receive proof of earned income (including a PI match in the Work Number) you must make two attempts to reach them to:

  • explain the 100% EID,
  • inform them of the impact the income will have on their SNAP if applicable, and
  • offer them the option to close the TAFDC and receive TBA SNAP and TSS, if they prefer.

You must document the conversation or your efforts to reach the parent or caregiver to discuss this in the narrative. You must not enter the income without making two attempts to reach them to discuss the 100% EID and document all your efforts in the narrative.

ExampleExampleJean (she/her) is receiving TAFDC for herself and two children. On September 23, 2024, Jean submitted a biweekly pay stub indicating part time earnings. When Jean’s case manager called to explain the 100% EID and the impact it will have on her SNAP benefits, Jean asked if she could just save the 100% EID for another time when she was earning more income. The case manager explained that there is not a choice to suspend the 100% EID but that she could withdraw the TAFDC instead so she can receive the TBA SNAP amount and TSS payments. 

See Transitional Benefits Alternative Overview and Transitional Support Services-T

What Happens When a Case is Reinstated?

At times there can be multiple things happening in the family’s case at the same time. Sometimes a case will close for a sanction and when the sanction is resolved the case is reinstated. When this happens, and the parent or caregiver is reporting earnings at the same time, you must:

  • resolve the sanction and reinstate the TAFDC on day one, and
  • add the earned income to the case on day two.

This will maximize the result for the family and the parent or caregiver will be eligible for the 100% EID if the income is under 200% of the poverty level and they choose to keep the TAFDC open or for TSS and TBA if the they choose to withdraw the TAFDC.

The exception to this is if there was a delay in the parent or caregiver reporting the earned income.

Example: Horatio (he/him) was receiving TAFDC for himself and his four-year-old son Marcelo but his case was closed for a Pathways to Work Sanction. Horatio had left a message for his case manager that he was starting a job next week near the family shelter he was just placed in. After attempts to reach Horatio by phone were not successful, the case manager sent a VC-1 for the wages and the shelter placement, but the sanction was released while the VC-1 was pending. When the verifications were received:

  • On day one the case manager: 
    • called Horatio to explain is option to keep the TAFDC or complete a voluntary withdrawal, 
    • documented their conversation in the narrative,
    • removed the sanction, 
    • added Horatio back to the TAFDC AU, and completed an Interview Wrapup
  • On day two the case manager:
    • added Horatio’s wages,
    • completed an Interview Wrapup, 
    • created a Pathways to Work Plan for the employment, and
    • issued a child care referral.

What if the Parent or Caregiver Stops Working?

When a parent or caregiver reports they have stopped working you must determine the reason they are not working and obtain the applicable verification.

  • If they are on a medical leave or are a seasonal employee who will return to the same employer, do not end the employment. Instead, leave the employer record in BEACON and zero out the earnings.
  • If they are not returning to the employer, end the record for the applicable employer.

In each case, the 100% EID disregard counter will stop counting cyclical payments used with the next benefit issuance.

If the parent or caregiver has not received all 12 cyclical payments, the counter will resume when they begin working again.

ExampleExampleAshley (she/her), who is pregnant, is active for TAFDC and is working part time. She has received 6 cyclical payments with the 100% EID.  On September 1, 2024, she verifies that she is on unpaid maternity leave. As case manager, it is your role to zero out her income and prospectively calculate without ending the employment record followed by completing an Interview Wrapup.

On January 3, 2025, Ashley provides verification that she is returning to work. Once her earnings are entered and prospectively calculated, her remaining cyclical payments will continue with the 100% Earned Income Disregard applied. 

What if the TAFDC Closes and the Parent or Caregiver Reapplies?

When a parent or caregiver reapplies for TAFDC, if they had not received all 12 cyclical payments with the 100% EID and are working or begin working again for the same employer the disregard counter will resume where it left off.

Example: Erin (they/them) had their case closed on August 1, 2024, for Income in Excess of Grant after receiving a pay increase. They had received 7 cyclical payments with the 100%EID prior to closing. They were eligible to receive TBA SNAP and their TSS payments began on 9/1/24. Erin reapplied for TAFDC on October 3,2024 with the same employer because their hours decreased.

As Erin’s case manager you will: 

  • explain to Erin that if the TAFDC is approved the TSS payments will stop and their SNAP will no longer be TBA which will impact their SNAP amount, 
  • give Erin the option to withdraw the TAFDC application, and
  • if Erin decides to go forward with the TAFDC application, after you approve the case:
    • complete a Pathways to Work Plan,
    • create a child care referral if one has not already been issued,
    • remind Erin that transportation will be issued automatically, and
    • write a narrative detailing the conversation with Erin.

What Happens after the 12 Cyclical Payments of 100% Earned Income Disregard?

Once the AU member has received 12 cyclical payments of 100% Earned Income Disregard, the TAFDC benefit will automatically be recalculated using the $200 Work-Related Expense Deduction and the 50% Earned Income Disregard.

ExampleExampleShaneia (she/her) is active for TAFDC. She is employed and receiving the 100% EID. On September 14, 2024, she received her 12th cyclical payment with the 100% EID. In her next cyclical payment her benefits were recalculated with the $200 WRE and 50% EID. She continues to be eligible for TAFDC with these deductions from her income. 

Can the Parent or Caregiver get Another 12 payments of 100% Earned Income Disregard?

A parent or caregiver can receive another 12 cyclical payments with the 100% EID only when:

  • their TAFDC case closes,
  • the TAFDC remains closed for 30 days or more, 
  • they reapply and are approved for TAFDC, and 
  • they have or later report a new employer.

ExampleExampleMichael (the/them) received TAFDC for themselves and their son and was employed at the time. His TAFDC closed for earnings on September 24, 2024, after receiving his final payment with the 100% EID and his TAFDC benefit recalculated with the $200 WRE and 50% EID. Michael reapplied for TAFDC on November 22, 2024, because the business closed. Michael is now working for a new employer and their earnings are less than the 200% poverty level. If the TAFDC is approved, Michael will be eligible for the 100% EID because the case was closed for more than 30 days and they have a new employer. 

Where is the Disregard Information in BEACON?

You can view the earned income disregard information on the Income Disregards page, located in the Assessed Person Income section of the workflow. 

  • The page shows each cyclical payment the parent or caregiver has received and whether or not the 100% EID was used for each payment.
  • It also provides a feature to suspend disregards, when applicable, and a feature to reset the disregard counter in instances when the parent or caregiver is eligible for a new counter and BEACON did not automatically reset the counter.

See Earned Income Disregards and Counters-TAFDC

Suspending the 100% Earned Income Disregard

The Income Disregards must be manually suspended when: 

  • the parent or caregiver has reduced income, quit their job, or refused a job without Good Cause. See Good Cause for TAFDC Rules, or
  • when the income was not reported timely and the parent or caregiver does not have good cause.  For a delay in reporting the earned income, good cause is limited to the serious illness of the parent or caregiver or their dependent child.

The 100% earned income disregard must not be manually suspended for any other reason.

When a parent or caregiver is not eligible for the 100% EID for other reasons such as a sanction, the 100% EID will automatically not be used in the benefit calculation.

Example 1Example 1Asad (he/him), his spouse, and three children are receiving TAFDC. When his case manager completed his reevaluation interview on 8/23/24 they addressed a continued Suspected of Living Above Means (SLAM) concern. In response, Asad indicated that he got a job doing construction. He states he is paid in cash and will receive a 1099 form at the end of the year. The case manager sent a VC-1 requesting a letter from the employer indicating his earnings, number of hours worked since he started and when he was first paid.

When the letter was received, it indicated Asad had been working for four months. The case manager called Asad to ask why he did not report the income when he first began receiving it and he could not provide a reason.  The case manager must enter the income and suspend the disregards on the Income Disregards page. They must also complete an overpayment referral for the SNAP in a combo case.  

Example 2Example 2Claudio (he/him) applied for TAFDC for himself, and one child on 9/7/24. He reported he was working full time and then got custody of his three-year-old son on 8/30/24. He stated that he had to quit his full-time job because he could not afford child care. He was still working his part time job earning only $150 per week. Given that Claudio has good cause for leaving the full-time job due to inability to afford child care, this would be considered good cause and the disregards would not be suspended. 

See Earned Income Disregards and Counters-TAFDC.

When do I Adjust the 100% Earned Income Disregard Counter?

There are times when the 100% EID counter will need to be adjusted. These include when:

  • the parent or caregiver does not report their earnings timely and has good cause,
  • the terminated employment is not reported timely and is verified,
  • there is a Department delay in entering the earned income, or
  • when an appeal decision instructs the Department to adjust the counter.

For information on how to adjust the counter see Earned Income Disregards Counters-TAFDC

ExampleExampleAlyssa (she/her) is receiving TAFDC for herself and her two-year-old son. She began working part time and had just received her first pay when she became ill and went into the hospital for two weeks. When she completed her reevaluation interview three weeks later, she reported the income to her case manager. Alyssa has good cause for the delay in reporting the income and her disregard counter must be adjusted.