Which Income the Housing Authority Counts

Section 8 counts most money that comes into your household, but not all of it. The Public Housing Authority (PHA) in your area adds up your gross income — that means before taxes, deductions, or anything else comes out — and uses that number to set your rent share. What counts is any money you receive regularly, whether it comes from a job, a government program, or someone else.

Wages and salary are the most straightforward. If you work, the PHA counts what you earn before withholding. If you receive unemployment benefits, Social Security, Supplemental Security Income (SSI), Temporary information for Needy Families (TANF), or child support, those all count as income. If someone in your household receives a pension, annuity, or regular payments from a trust, those count too. The PHA also counts money from roomers or boarders — if someone pays you to live in your unit, that payment is income.

Key Takeaways

  • The PHA counts gross income before taxes and deductions, including wages, benefits, pensions, child support, and rental income from roomers.
  • Certain income sources are legally excluded, including most gifts, lump-sum payments, tax refunds, and money from selling an asset you own.
  • The first $480 per year of income earned by a household member under age 18 is excluded, and the next $400 is excluded if the household is working toward self-sufficiency.
  • Medical expenses and childcare costs reduce your countable income through deductions, which can lower your rent share.
  • Your PHA's local policies may exclude additional income sources beyond federal rules, so asking your caseworker what counts in your area matters.

Income the PHA Does Not Count

Federal law excludes certain income from the calculation. Gifts do not count — money given to you by family or friends with no expectation of repayment is not income. Lump-sum payments are excluded, meaning money you receive all at once rather than regularly. This includes tax refunds, insurance settlements, inheritances, and the proceeds from selling a car or other property you own. Money you borrow — whether from a bank, a friend, or a family member — does not count because you have to pay it back.

Certain benefits are also excluded. If you receive food information (SNAP), energy information (LIHEAP), or other in-kind benefits, those do not count as income. Money set aside in an Individual Development Account (IDA) — a savings program for people with low income — is excluded. If you are a student and receive financial aid, grants, or scholarships, those do not count. Foster care payments and adoption information payments are excluded. Money from the Earned Income Tax Credit (EITC) is not counted as income in the year you receive it.

Special Rules for Earned Income

The PHA gives a break to household members who are working. If anyone in your household is under age 18 and earns money, the first $480 per year is excluded entirely. The next $400 per year is also excluded if your household is participating in a self-sufficiency program or if the household head or spouse is working toward a high school diploma or GED.

Some PHAs offer an additional exclusion for households that increase their earnings. If your income goes up because someone got a job or got more hours, some housing authorities will exclude a portion of that new income for a set period — often 12 months — to help you adjust. This is called an earned income disregard, and it varies by PHA. Ask your caseworker whether your local authority offers this, because it can significantly lower your rent share when you start working or earn more.

Deductions That Lower Your Countable Income

Even when income counts, you may be able to subtract certain expenses. The PHA allows deductions for childcare costs if you pay for care so you can work or look for work. You can deduct the actual amount you pay, up to the limit your PHA sets. If you have a household member who is disabled or elderly, you can deduct the cost of care or services they need — again, up to your PHA's limit.

Medical expenses for elderly or disabled household members are also deductible. This includes doctor visits, prescriptions, therapy, medical equipment, and transportation to medical appointments. You deduct the amount that is not covered by insurance. These deductions come off your gross income before the PHA calculates your rent share, so they can make a real difference in what you pay each month. Keep receipts and bills to show your caseworker what you spent.

How to Report Income Changes

You must report income changes to your PHA, usually within 10 days. If someone in your household starts a job, gets a raise, loses a job, or stops receiving a benefit, tell your caseworker. If you receive a one-time payment like a tax refund or inheritance, report it — but remember that lump sums do not count as income anyway. If your household composition changes (someone moves in or out), that affects income too.

Failing to report income changes can result in owing back rent or losing your voucher. The PHA will recalculate your rent share based on the new income, and if you have been underpaying, you will owe the difference. If you have been overpaying because you did not report a job loss or benefit reduction, the PHA should adjust your rent downward going forward. Always keep your caseworker in the loop.

How Your PHA May Differ

Federal rules set the floor, but individual PHAs can exclude additional income sources or offer more generous deductions. Some housing authorities exclude income from seasonal work, or they may have a higher cap on childcare deductions. A few PHAs offer additional earned income disregards beyond the federal minimum. Your local PHA's policies are in their Administrative Plan, a public document you can request.

The best way to know what counts in your situation is to ask your caseworker directly. Bring a list of all income sources in your household — wages, benefits, child support, anything else — and ask which ones the PHA counts. If you are about to start a job or expect a change, ask how it will affect your rent. Your caseworker can also tell you whether your PHA offers any local exclusions or disregards that might help you.

Frequently Asked Questions

Does the PHA count money my adult child gives me?

No, gifts do not count as income. However, if your adult child lives in the unit and contributes to household expenses, their income counts toward the household total. If they live elsewhere and straightforward give you money, that is a gift and is excluded.

What if I get a one-time bonus at work?

A bonus is earned income, so it counts. However, if it is paid all at once rather than spread across pay periods, some PHAs may treat it differently. Report it to your caseworker and ask how they will count it — some may average it over the year, while others count it in the month received.

Does my tax refund count as income?

No. Tax refunds are lump-sum payments and are excluded from income. The same applies to any money you get back from overpaying taxes or from the Earned Income Tax Credit in the year you receive it.

Can I hide income to keep my rent lower?

No. The PHA verifies income through tax returns, pay stubs, and benefit statements. Hiding income is fraud and can result in eviction from the program, a demand for back rent, and potential criminal charges. Always report what you earn.

If I start working, will my rent go up when ready?

Your rent will not change until the PHA recalculates your income. This usually happens at your annual recertification, but if you report a significant income change, the PHA may recalculate sooner. Some PHAs offer an earned income disregard that delays the rent increase for 12 months, so ask your caseworker.