What Are Allowable Deductions When Determining Net Income?

Calendar Icon Updated January 15, 2019
Food Stamps

In regards to eligibility, your net pay is what is considered for income. To figure out your net income, you must first start with your gross income and then deduct all allowable deductions. For SNAP eligibility, there are seven acceptable deductions. Not all of these may apply to every person, but if any of them apply to your household, they can be deducted prior to submitting your application for consideration.

The allowable deductions are:

  • 20% of earned income, so you can subtract 20% from your reported net pay. This includes wages, salary, commissions, etc.
  • All applicants are allowed to deduct $155 for a household of 1-3 people and $168 for households with more than 4 people.
  • If you need to pay for personal care for children, elderly, or disabled members of the household in order for you to work, you can deduct the cost of that care. The personal care deduction does not cover animal care.
  • Certain medical expenses for elderly and disabled members of the household can be deducted. Approved expenses include ones that are over $35 and not covered by insurance. This does not include office co-pays.
  • Legally-owed child support payments. Court documents will be needed for documentation.
  • Many states allow applicants to deduct shelter costs if they are homeless and living in a shelter. If this is the case, it is important to make it clear to the case worker when applying that you are living in a homeless shelter.
  • Approved shelter costs that exceed half the household’s net income after the other six deductions have been taken out. Approved costs cover monthly mortgage or rent payments, property taxes, utilities including electricity, water, fuel for heat, and the basic fee for one phone line. The total of those deductions cannot be more than $504. This particular deduction carries exceptions for elderly or disabled household members, and the maximum amount of this deduction is higher in Alaska and Hawaii due to differences in cost of living.

Once these deductions are subtracted from your income, your eligibility can be considered. In order to determine your allotment, they will take 30% of the net income to subtract from the maximum allotment amount for your household size. The deductions play a significant role in both eligibility and the determination of benefits.

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If you are unsure of whether or not a specific deduction applies to you, you can ask a representative at your local SNAP office. However, if you think it applies, it is best to figure it in. If it doesn’t, they will make the appropriate adjustments when determining your benefits. The lower you can get your net income by subtracting deductions, the more likely you will be to qualify for SNAP benefits.

Another thing to consider when applying for benefits is that many programs are not exclusive. For example, if you have children under the age of 5, you can apply for WIC along with SNAP. WIC will cover the cost of food and formula for the children that are age eligible without reducing the amount of SNAP benefits you receive.

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