Corrections to Counting Foster Children and Income for Determining Eligibility

Q The January 2018 issue of the Insider (“Five Dos & Don'ts When Certifying Households with Foster Children”) stated that you don’t count foster children as household members when calculating income limits for eligibility and that income paid to foster children is not counted in household income. Are these correct in light of Change 4 of the HUD Handbook 4350.3?

A No. Special thanks to assisted housing consultants Karen Graham and A.J. Johnson for pointing these out. Change 4 to HUD Handbook 4350.3 made some changes to family size determination. Specifically, it removed foster children and foster adults from the list of whom to exclude when determining family size for income limits. The removal of this language inherently means that you must now count foster children and adults when determining income limits and family size for the purpose of eligibility. Foster children, however, are not dependents and do not qualify for the $480 allowance.

With Change 4, even though foster children and foster adults are now considered household members when determining family size, income or payments received by the family for the care of foster children and foster adults is still not counted. The Handbook states, “Payments received by the family for the care of foster children or foster adults are not counted. This rule applies only to payments made through the official foster care relationships with local welfare agencies” [par. 5-6(A)(3)(g)].

However, income paid to a foster child may be included in annual income. According to Figure 5-2 of the HUD Handbook, employment income earned from a foster child who is under 18 years old is excluded from annual income. And unearned income such as Social Security benefits and any income earned from an asset owned by the foster child or foster adult is included in annual income.