2134. What is earned income?

Earned income is:

1. Wages paid or constructively paid (as defined in §1302) for services you perform as an employee;

2. Military pay and allowances except for on-base and privatized military housing and hostile fire and imminent danger pay;

3. Net earnings from self-employment estimated for a current year on the basis of volume of business, past experience, etc.;

4. Payments for participating in a sheltered workshop or work activities center program;

5. Sickness or temporary disability payments received within the first six months of stopping work; and

6. Royalties you earned in connection with any publication of your work and any honoraria received for your services.

Earned income may be paid in cash or in-kind. If it is in-kind, its full current market value is the amount used to determine your countable income.

Last Revised: Feb. 24, 2009