Needs Tests Instructions

Include all countable earned and unearned income. Follow the steps below:

Total the gross earned and unearned income for each person.

Add applied income amount. Applied income is the countable amount of income after allowing deductions for tax dependents, child support, alimony, and people a legal parent is legally obligated to support.

Subtract the child support disregard, if applicable.

Subtract the standard work-related expense (not to exceed the household member's monthly earned income) for each qualifying member with countable earnings.

Subtract each member's allowable costs for dependent care (up to the maximum).

Subtract any child support expense.

Compare the net income to the budgetary needs amount. If the net income or unmet need is 50 cents or more, the household passes the budgetary needs test.

Note : If there is a diversion amount and someone other than the person with diversions has count income (or two household members with joint diversions both have countable income), each member's income or earned income deductions are computed separately until the actual amount allowed to be diverted from each person's income is subtracted. Then the total net incomes are combined.

When two members have joint diversions, any amount of the diversion that exceeds one member's income can be diverted from the other member's income using the steps below:

Subtract 1/3 of the net income for applicants with earned income who have not been active TANF in the last four months.

Subtract 90 percent of the remaining earnings (up to a cap of $1,400). Allow this deduction for each employed household member who is eligible for it. The person can receive this deduction for four months in a 12-month period. The four months do not have to be consecutive. Note: Do not count a month in which a full-family sanction is imposed as one of the 90 percent earned income deduction (EID) months.

Note: If there is a diversion amount and someone other than the person with diversions has countable income (or two members with joint diversions both have countable income), each member's income and earned income deductions are computed separately until after subtracting the actual amount allowed to be diverted from each person's income. Then the adjusted gross incomes are combined.

When two members have joint diversions, any amount of the diversion that exceeds one member's income can then be diverted from the other member's income.

For each household member with earnings, the deductions cannot exceed the person's total income. This also applies when there is more than one household member with earnings, diverted income or both. The adjusted income should be compared to the recognizable needs amount. If the adjusted income is one cent or more, the household passes the recognizable needs test. The adjusted income is subtracted from the maximum grant amount to determine the benefit amount.