PM 08-01-02-b

New Manual Amount - Chart titled Initial Employment Deduction for amountsSee WAG 25-03-01 (1) chart titled Initial Employment Deduction for amounts.

New manual materialSee WAG 25-06-18 for historical data on the Initial Employment Deduction.

New Manual MaterialExamples of calculating the IED

The following are examples of how the IED is calculated on new request for TANF cash.

Example 1: Ms. A applies for TANF cash for herself and her four children.  She has earned income of $800 per month.  The IED is calculated as follows: 

  • $28,440 (Annual FPL for 5 people) 
  • divided by 12 months
  • equals $2,370 (Monthly FPL for 5 people)
  • divided by 2
  • equals $1,185 (1/2 of the monthly FPL for 5 people)
  • minus $555 (payment level)
  • equals $630 (IED amount)

Ms. A passes the first test of eligibility as budgeted earned income of $170 ($800 earned income minus $630 IED) is less than the payment level of $555.

Example 2: Mr. R and Ms. Q apply for TANF for themselves and their five common children.  Mr. R has earned income of $2400 per month.  Ms. Q has earned income of $1200 per month.  The IED is calculated as follows: 

  • Calculation of Mr. R.'s IED
    • $36,730 (Annual FPL for 7 people)
    • divided by 12 months 
    • equals $3,060.83
    • divided by 2 (drop cents)
    • equals $1,530
    • minus $657 (TANF payment Level)
    • equals $873 (IED amount)
  • Calculation of Ms. Q.'s IED
    • $36,730 (Annual FPL for 7 people)
    • divided by 12 months 
    • equals $3,060.83
    • divided by 2 (drop cents)
    • equals $1,530
    • minus $657 (TANF payment Level)
    • equals $873 (IED amount)

Mr. R and Ms. Q do not pass the first test of eligibility.  Mr. R's budgeted earned income of $1527 ($2,400 earned income minus $873 IED), plus budget earned income for Ms. Q of $327 ($1200 earned income minus $873 IED) is over the TANF payment level of $657.

New Manual MaterialSpecial budgeting situations:

To determine family size for Parent Liability, see PM 10-04-04. To determine family size for an ineligible parent or excluded spouse, see Diverted Income WAG 10-04-02

Example 1: Parent Liability - Tonya is an unmarried 16 year old applying for TANF for herself and her child. She lives in Cook County with her employed parents, Bob and Sue, and her 2 younger brothers.

The parents' family unit size is 4, including Bob and Sue and their 2 dependent sons. Do not include Tonya and her child. Use the IED for a family unit size of 4 in County Group 1.  

Example 2: Ineligible  Parent - Mrs. A. lives in Sangamon County and applies for TANF for herself and 2 children. Mr. A. is ineligible for TANF due to his immigration status, but since he is employed, his income must be used to determine financial eligibility for Mrs. A. and their 2 children. Mr. A. has a young son living with the family who also is an ineligible noncitizen.

The family unit size is 2, including Mr. A. and his dependent ineligible son. Use the IED for a family unit size of 2 in County Group 2.

Example 3: Excluded Spouse - Mrs. B. lives in Jasper County and applies for TANF for herself and her 4 children. Mr. B. is not the father of any of the children. He is employed, and is not applying for TANF as an optional person. Mr. B brought his own 2 young children to the marriage.

The family unit size is 3, including Mr. B. and his 2 dependent children. Use the IED for a family unit size of 3 in County Group 3.

New manual material Treatment of earned income when a former client stops receiving child support. 

Example: Ms. V receives TANF for herself and her three children.  The TANF Payment Level for Ms. V is $474 (one adult and 3 children). Ms. V reports employment earning $1600 each month.  Child support in the amount of $250 is also being paid to the Division of Child Support Services.After allowing the $50 Pass Through, $200 child support is used to compare to the cash benefit the client receives.  The TANF calculation is as follows:

$1600 Gross earned income

-$1200 3/4 income deduction

$400 earned income is budgeted.

+ $200 Child Support ($250-$50 Pass Through)

= $600.00 Compared to the Payment Level of $474

The combination of budgeted earned income ($400) and child support ($200) makes the case ineligible for cash benefits. The cash assistance is stopped effective 10/15.

In 12/15, the child support stops and Ms. V requests cash assistance.  Do not apply the first eligibility test using the IED. Apply the 2nd eligibility test. Ms. V is eligible for cash:

$1600 Gross earned income

-$1200 3/4 income deduction

= $400 Compared to the Payment Level of $474

Since $400 is less than the Payment Level of $474, Ms. V is eligible for cash benefits under TANF.