EID Brochure Overview - OneCPD

Employment Pays Off
HUD’s Earned Income Disallowance allows tenants to go to work and
keep more of their paycheck.
Overview
The Earned Income Disallowance, sometimes called Earned Income Disregard or
EID, is a program that allows eligible tenants to increase their incomes through
employment without triggering rent increases. The goal of EID is to motivate people
who qualify for the program to accept employment, rather than being discouraged
from work by the belief that much of what they earn will be spent on higher rent.
Also, EID participants are better able to pay for the costs of keeping employment,
such as transportation and work clothing.
EID also benefits organizations that operate subsidized housing. Tenants who work
strengthen housing programs by adding greater stability and bringing new
resources to the community. EID helps reduce tenant turnover, potentially lowering
administrative costs, and helps stabilize the program’s subsidy stream, even as
tenants work towards greater self-sufficiency.
Who is Eligible
To qualify for EID, one of the following must be true of the tenant’s living situation:
1. Lives in Public Housing; or
2. Has a disability and either participates in the Housing Choice Voucher
Program or lives in housing subsidized with HOME Investment Partnership
Program (HOME), Housing Opportunities for Persons with AIDS (HOPWA), or
Supportive Housing Program (SHP) funds.
In addition, one of the following must be true of the household’s increased income:
1. Income has increased as a result of the employment of a family member who
was “previously unemployed,” meaning that the family member has not
worked at all in the past 12 months, or has worked at no more than the
minimum wage (Federal, State, or local minimum wage—whichever is
highest) for 500 hours or less during the past 12 months; or
2. Income of a family member increased as a result of employment during that
family member’s participation in any economic self-sufficiency or job training
program; or
3. Income of a family member has increased as a result of employment while
that family member was receiving—or within six months after receiving—
welfare (TANF) payments, benefits, or services worth at least $500.
In the case of families participating in Section 8 Housing Choice Voucher Program
or living in housing subsidized with HOME Investment Partnership Program (HOME),

Housing Opportunities for Persons with AIDS (HOPWA), or Supportive Housing
Program (SHP) funds, an adult family member having a disability must meet one of
the three income criteria above.
Disability Defined
Under the HUD and Social Security Administration definitions of disability, a person
must, generally speaking, have a physical, mental or emotional impairment that:
• is expected to be of long, continued, and indefinite duration;
• substantially impedes his or her ability to live independently; and
• is of such a nature that the person’s ability to live independently could be
improved by more suitable housing conditions.
Among the people meeting this definition would be a person who has a
developmental disability and/or a chronic mental illness that seriously limits his or
her ability to live independently and which could be improved by more suitable
housing conditions.
Time Limits
EID may be used for a total of 24 months, but a tenant can receive the benefit over
a 48-month period. The 48-month period begins on the date when the family
member first begins employment and can stop and start along with employment.
For example, a person could start and maintain employment for three months, and
use EID, then stop working. If he or she began working again within 48 months of
the first use of EID, he or she would be able to use EID to fully disregard up to nine
more months of employment income.
How to Calculate EID
The exact EID benefit amount depends on the tenant’s income. Starting from the
base income prior to employment, 100% of any increase in income from work will
be ignored for up to 12 months, and rent will not increase. After those 12 months
have been used, up to 50% of an income increase from work will be ignored for
another 12 months. The benefit starts and stops along with income from
employment.
For families that qualify for EID because a family member with a disability has
gained employment, only the earnings of the individual with disabilities are
excluded from calculating annual income.
Example
• Monthly SSI Income is $590.
• After disability-related adjustments, monthly income counted is $520.
• $520 x 30 percent (maximum allowed by HUD) = rent payment of $156 per
month.
• Tenant gets a job earning $1,000 per month.
• For the first 12 months, this income is “disallowed” and rent does not go up.

• For months 13 through 24, 50 percent of $1,000 ($500) is “disallowed” and
the other 50 percent is counted towards income, for a total income of
$1,020.
• Rent is then adjusted, for a monthly payment of $306 (30 percent of
$1,020).
For More Information
If you are unsure if your housing is subsidized with HOME, HOPWA, or SHP funds,
or if you want more information, contact the financial manager or executive director
of your organization. For more brochures or a poster, contact Community
Connections at 1-800-998-9999 and request that copies be sent to you. An indepth
training module is available online at www.hudhre.info