Department of Human Services

Food Stamp Online  Policy Manual

Payments/Benefits Excluded In Eligibility Determination




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Money payments that are not payable directly to the household but are paid to a third-party for the household’s expenses are vendor payments and are excluded.




Monies that are legally obligated and otherwise payable to the household, but which are diverted by the provider of the payment to a third-party for a household expense are counted as income and are not excluded as vendor payments.   The distinction is whether the person or organization making the payment on behalf of a household is using funds that otherwise would have to be paid to a household.   These funds include any wages earned by a household member, support and alimony payments which legally must be paid to a household, educational loans on which payment is deferred, grants, scholarships, etc., which are paid to a third-party for living expenses.   If any employer, agency, former spouse or other person makes payments for household expenses to a third-party from funds that are not owed to the household, these payments must be excluded as vendor payments.


Example:  Wages earned by a household member that are garnished or diverted by an employer, and paid to a third-party for a household’s expenses or debt, such as rent, are considered as income.   However, if the employer pays a household’s rent directly to the landlord in addition to paying the household its regular wages, exclude this rent payment as a vendor payment.   In addition, if the employer provides housing to an employee, exclude the value of the housing from the income determination.


Example:  Payments specified by a court order or other legally binding agreement to go directly to a third-party, rather than to the HH, and voluntary support payments which are paid to a third-party, rather than the HH, are excluded as vendor payments, even if the HH agrees to the arrangement.


Example:  Garnishments include all or part of a cash assistance grant which would normally be provided in money payment to the household, but which is diverted to third-parties or to a protective payee for purposes such as managing a household.   However, payments by the Department that would not normally be provided as a money payment to the household, and that are over and above normal cash assistance grants, are excluded as vendor payments if they are made directly to a third-party for a household expense.   This rule applies even if the household has the option of receiving a direct cash payment.


Glossary of Terms

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