Income Calculations & Rent Determination Flashcards

Under HUD rules, the elderly/disabled household deduction from annual income is:

Answer: $400

HUD allows a $400 deduction for elderly or disabled households when calculating adjusted income.

A household's medical expenses are $2,400/year and their annual income is $12,000. They qualify for the medical expense deduction on amounts exceeding 3% of annual income. What is their deduction?

Answer: $2,040

3% of $12,000 = $360; deduction = $2,400 − $360 = $2,040.

A household receives a one-time insurance settlement of $10,000 due to property damage. How is this treated for income purposes?

Answer: Excluded as a one-time lump sum

Lump-sum one-time payments received as compensation for loss of property are excluded from annual income.

When must an owner use current actual income rather than anticipated income for a household member?

Answer: When the current income is verifiable and represents ongoing earnings

HUD requires using the most current, verifiable income that accurately reflects anticipated earnings going forward.

A flat rent for a unit is $700/month and the household's income-based rent is $420/month. Which amount does the tenant pay?

Answer: The lower of the two amounts

Public housing residents pay the lower of flat rent or income-based rent per HUD rules.

A household's total assets are $4,800. How does this affect the income calculation?

Answer: Only actual income earned is counted

When total asset value is $5,000 or less, only actual income earned from those assets is counted.

A household member stops working temporarily due to illness and will return in 3 months. How should their income be calculated?

Answer: Annualize anticipated income based on expected return-to-work wages

Income is projected over the next 12 months, so anticipated wages upon return should be annualized.