CKS-13
THE EFFECT OF SELECTED KEAGAN1
ON CASH PLUS FOOD ST^IP li^COill
(Family of 3)
'ION PROPOSALS
^IL-C LLCIPIUNTS
NEW YORK CITY
Current Law I/
Earnings 2j
$0
145
290
436
581
Income and
Payroll Taxes J3/
$0
10
(1/4 time)
19
(1/2 time)
30
(3/4 time)
(full time) 65
1.
Earned Income
Tax Credit
$0
14
29
42
32
»
AFDC
Grant 4/
$394
349
251
177
122
Cash Plus
Food Stamp
(After
Food Stamp
Tax)
Benefit 5/
$90
66
57
41
25
$484
564
608
666
695
Administration's Proposal for Ceiling on Gross Income
If gross income (earnings + earned income tax credit) is greater than 150 percent of the State's need standard ($591; 150 percent x $394), then the family
does not receive an AFDC grant.
2. Administration's Disregard Proposal (First 4 months of job) 6/
$0
10
19
30
436 (3/4 time)
581 (full time) 65
$0
145 (1/4 time)
290 (1/2 time)
3.
$0
145
290
436
581
$0
14
29
42
32
$394
321
226
132
55
$90
75
64
55
45
$484
545
590
635
648
Administration's Disregard Proposal (After 4 months on job) TJ
$0
10
(1/4 time)
19
(1/2 time)
(3/4 time) 30
(full tine) 65
$0
14
29
42
32
$394
254 '.
113
0
0
•r
$90
95
98
94
62
$484
498
511
542
610
I/ Calculations cssiafc no child csre expenses. Other work expenses (e.g.,
transportation expense) *i assumed at $o2 per month (subway fare » .60 cents,
telephone survey indicated that on average people travel through two zones $1.20; $2.40/day x 5 days/wks x 52 wks./yr. divided by 12 mos./yr. - $52/mos.)
for a tjiree-fourths time and full time-worker and $31 per month (based on a 3
day work week - 3/5 x 52) for a one-fourth tine and one-half time worker. The
following data is based on a telephone survey regarding work expense deductions.
Maximum child care disregard allowed:
$297 per month per child
(1) publicly funded day care center
$195 per month per child
(2) private day care center
$200 per month 1-3 children
(3) caretaker comes to child's home
$160 per month 1-3 children
(4) child goes to caretaker's home
27 Earnings are based on the minimum wage - $3.35/hour. The average earnings of AFDC recipients in New York is approximately $450 per month.
3/ For earnings of $436 and $581 monthly, State and city taxes were $1 an
$6, respectively; otherwise $0. The Federal income tax was $20 for earnings
equal to $581 per month, otherwise $0. Income tax figures are based on the
1980 tax rates. Payroll taxes are equal to 6-. 6 5 percent of income.
4/ The ohild ere aud Uaifltpuiimiua expan
grant. f4 *>£*/< ? 4
axes as shown in the tables are used in calculating the AFD£
*Vlf-t7mf cb »
CfrVS U//if M',v/v*ci <vt -*
$y, »N*nrf '1 Mr»f
ch
*fa 3N +*4
5/ Food stamp benefits are based on the AFDC grants shown and assume
deductions of $85 monthly (standard household deduction).
6/ Administration's Proposal standardize work expense at $75 monthly,
prorate for part-time work; cap child care disregard at $50 monthly per child,
and apply the disregards for recipients in the following order: (1) flat $30;
(2) standard allowance of $75, prorated for less than full time work, (3) actual
child care expenses up to $50 per child per month; and (4) one-third of the rest
of income. The calculations assume no child care expenses.
TJ Administration's Proposal withdraw the work incentive bonus ($30 plus
one-third disregard) after 4 straight months of work. Thus, after 4 straight
months of work a recipient woudl £nly L be allowed a disregard of (1) the standard
allowance of $75 per month, prorated for less than full time work, and (2)
actual child care expenses up to $50 per child per month. The calculations
shown in the table assume no child care expenses.
CKS-15
THE EFFZCT OF SELECTED REAGAN ADMINSTRATION PROPOSALS
ON CASH PLUS FOOD STAMP INCOME OF AFDC RECIPIENTS
(Family of 3)
LOS ANGELES
Current Lav I/
Income and
Payroll Taxes 3/
Earnings
Food Stamp
Earned Income AFDC
Grant 4/ Benefit 5/
Tax Credit
Cash Plus
Food Stamp -I* tCi(After
Tax)
i
$0
145
290
436
581
(1/4 time)
(1/2 time)
(3/4 time)
(full time)
1.
$0
14
29
42
32
$0
10
19
29
59
$463
418
320
245
185
$70
46
36
20
6
$533
613
656
714
745
Administration's Proposal for Ceiling on Gross Income
If gross income (earnings + earned income tax credit) is greater than 150 percent of the State's need standard ($705; 150 percent x $470), then the family
does not receive an AFDC grant*
2.
$0
145
290
436
581
145
290
436
581
$0
14
29
42
32
$0
10
(1/4 time)
19
(1/2 time)
29
(3/4 time)
(full time) 59
3.
$o
Administration's Disregard Proposal (First 4 months of job) 6/
$463
390
295
201
124
$70
54
43
34
25
$533
593
638
684
703
Administration's Disregard Proposal (After 4 months on job) 7/
$0
14
29
42
32
$0
10
(1/4 time)
19
(1/2 time)
29
(3/4 tine)
(full time) 59
. f.
$463
323
182
41
0
$70
74
77
82
62
$533
546
559
572
616
f
CRS-16
.
^which
l_l Calculations assume no child care expenses. Other work expehnses
per mont (this
in this case means transportation expens^ JM assumed at $52 ctio
n source: telefigure was given as the average transportation expense dedu
per month
phone survey) for a th~ree-£ourths time and full-time worker andand$311/2 time
(based on a 3-day week, i.e., 3/5 x 52) for a one-fourth timechild care expenses
worker. In Los Angeles, the average amount disregarded for
was $128 per month per child*
average of
2] Earnings are based on the minimum wage - $3.35/hr. The per
month.
earnings of AFDC recipients in California is approximately $540
ls. The
3/ There were no State or city taxes for the given income leve
h, otherwise $0.
Federal income tax was $20 for earnings equal to $581 per mont
of household
Income taxes are based on the 1980 tax rates, assumptions:6.65head
percent of income.
with two dependent children* Payroll taxes are equal to
___
o
r
f
f
___'
r4/
^_^
d
. Buse «m
taxes as shown in the tables are used in calculating the AFDC grant
iu- LUB An&uluy «Ls
d mils aiJBUA &ai'd
IHIJU&C chilC-1&3
talaphoui aunitj Infoim' iMim MmT^**
.
:*.
\*ft( 4
- **+ "*
O
me
5j Food stamp benefits are based on the AFDC grants shown and assu
deductions of $85 monthly (standard household deduction).
monthly,
6/ Administration's Proposal standardize work expense at $75
monthly per
prorated for part-time work; cap the child care disregard at $50
g order: (1)
child, and apply the disregards for recipients in the followin
-time work;
flat $30; (2) standard allowance of $75, prorated for less thanandfull
(4) one-third
;
(3) actual child care expenses up to $50 per child per month
expenses.
of the rest of earned income. The calculations assume no child care
e bonus ($30 plus
]_/ Administration's Proposal withdraw the work incentiv
after 4 straight
one-third disregard) after 4 straight months of work. Thus,d_of
the stanmonths of work a recipient woiidl {only* be allowed a disregar -tim) e(1)work, and
dard allowance of $75 per month, prorated for less than full The calculations
(2) actual child care expenses up to $50 per child per month.
shown in the table assume no child care expenses.
"i
CRS-1'
THE EFFECT OF SELECTED REAGAN ADMINISTRATION PROPOSALS
ON CASH PLUS FOOD STAMP INCOME OF AFDC RECIPIENTS
(Family of 3)
DETROIT
Current Law I/
Income and
Payroll Taxes 3/
Earnings 2/
Earned Income
Tax Credit
AFDC
Grant 4/
Cash Plus
Food Stamp
(After
Food Stamp
Tax)
Benefits V
t
$0
145 (1/4 time)
290 (1/2 time)
436 (3/4 time)
581 (full time)
1.
$0
10
19
30
67
$0
14
29
42
32
$432
380
282
203
150"
$79
57
47
33
17
$511
586
629
684
713
Administration's Proposal for Ceiling on Gross Income
If gross income (earnings + earned income tax credit) is greater than 150 percent of the State's need standard ($648; 150 percent x 432), then the family
does not receive an AFDC grant.
2.
$o
145
290
436
581
$0
10
(1/4 time)
19
(1/2 time)
30
(3/4 time)
(full time) 67
3.
(1/4 time)
(1/2 time)
(3/4 time)
(full time)
$0
14
29
42
32
$432
359
264
170
93
$79
63
53
43
34
$511
571
617
661
673
Administration's Disregard Proposal (After 4 months on job) 7/
$0
$0
145
290
436
581
Administration's Disregard Proposal (First 4 months of job) 6/
10
19
30
67
$0
14
29
42
32
$432
292
151
10
0
$79
83
87
91
62
$511
524
538
549
608
7L
\J Calculations assrur.e no child care expenses. Other work expenses (e.g.
transporation expense) « assumed at $40 per month (telephone survey indicated
that this was the maximum allowed for disregard purposes) for a three-fourths
time and full time work and $24 per month (based on a 3-day work week - 3/5 x
40) for a one-fourth time and one-half time worker* Michigan does not allow
the child care expense disregard. All AFDC families are eligible for child
care services under Title XX.
2J Earnings are based on the minimum wage - $3.35/hour. The average
earnings of AFDC recipients in Michigan is approximately $360 per month.
3/ For earnings of $436 and $581 monthly, State and city taxes were $1
and $8, respectively, otherwise 0. The Federal income tax was $20 for earnings of $581 per month, otherwise 0. Income tax figures are based on the 1980
tax rates. Payroll taxes are equal to 6.65 percent of income.
The child care and transportation UApeium abbumpliuus lugUlUei Pith
-tire taxes as shown in the tables are used in calculating the AFDC grant. T/
5J Food stamp benefits are based on the AFDC grants shown and assume
deductions of $85 monthly (standard household deduction).
6/ Administration's Proposal standardize work expense at $75 monthly,
prorate for part-time work; cap child care disregard at $50 monthly per child,
and apply the disregards for recipients in the following order: (1) flat $30;
(2) standard allowance of $75, prorated for less than full-time work; (3)
active child crae expenses up to $50 per child per month; and (4) one-third of
the rest of incomes. As under current, applicants would be ineligible for the
$30 plus one-third work incentive bonus. From their earnings, only expenses
would be deducted. The calculations assume no child care expenses.
]J Administration's
plus one-third disregard)
straight months of work a
standard allowance of $75
and (2) actual child care
calculations shown in the
Proposal withdraw the work incentive bonus ($30
after 4 straight months of work. Thus, after 4
recipient would only be allowed a disregard of (1)
per month, prorated for less than full time work,
expenses up to $50 per child per month. The
table assume no child care expense.
CRS-19
THE EFFECT OF SELECTED REAGAN ADMINISTRATION PROPOSALS
o:; CASH PLUS FOOD STAMP INCOME OF AFDC RECIPIENTS
(Family of 3)
CHICAGO
Current Law JL/
Income and
Payroll Taxes 3/
Earnings 2J
$0
145
290
436
581
$0
10
(1/4 time)
20
(1/2 time)
36
(3/4 time)
(full time) 67
!
:
Earned Income AFDC
Grant 4/
Tax Credit
$0
14
29
42
32
$302
247
150
74
15
Food Stamp
Benefit 5/
$118
97
87
72
37
Cash Plus
Food Stamp
(After
Tax)
$420
493
536
588
618
Administration's Proposal for Ceiling on Gross Income
If gross income (earnings + earned income tax credit) is greater than 150 percent of the State's need standard ($453; 150 percent x $302), then the family
does not receive an AFDC grant.
2.
$0
145
290
436
581
$0
10
(1/4 time)
20
(1/2 time)
36
(3/4 time)
(full time) 67
3.
$0
145
290
436
581
Administration's Disregard Proposal (First 4 months of job) 6/
$0
14
29
42
32
$302
229
134
40
0
$118
102
92
82
62
$420
480
525
564
608
Administration's Disregard Proposal (After 4 months on job) TJ
$0
10
(1/4 time)
(1/2 time) 20
36
(3/4 time)
(full time) 67
$0
14
29
42
32
$302
162
21
0
0
$118
122
126
94
62
$420
433
446
536
608
CRS-20
expenses (e.g.,
l/ Calculations assume no^ child care expenses. Other work .80
cents; $1.60
transportation expense) ie assumed at $35 per month (bus-fare « three-fourths
x 5 days/wk. x 52 wks./yr. divided by 12 mos./yr. * $35) for a
work week - 3/5 x
time and full time worker and $21 per month (based on a 3-day owin
g information
35) for a one-fourth time and one-half time worker. The follcare disregard:
was obtained in a telephone survey* Maximum allowable child
1. licensed day care center $224 per month per child
$132 per month per child
2. licensed day care home
$ 95 per month per child
3. otherwise
schedule is
Chicago has a "deduction which is based on gross income. The nse,
and a
expe
broken down into three parts; a budgeted amount, an employment
ately 20 perfamily earned income expense. The employment expense is approxim
rity taxes,
cent of gorss Income and includes: withholding taxes, social secu
, and special
supplemental lunch expenses, "reasonable** transportation expenses
th insurance if
tools and equipment, union dues, life insurance and group heal
basis of the
they are mandatory. Instead of using employment expense as the
"reasonable"
transportation expense disregard, I used bus fare in determining
transportation expenses.
2/
Earnings are based on the minimum wage - $3.35/hour.
taxes
3/ For earnings of $290, $436, and $581 monthly, State and city tax was
income
were $1, $7, and $8, respectively, otherwise $0. The Federal
figures are
$20 for earnings of $581 per month, otherwise $0. The income tax
income.
based on the 1980 tax rates. Payroll taxes equal 6.65 percent of
grant. 1(0r*£p£i
are used in calculating the AFDC
B taxes as shown in the tables! '6.4-1
wrjtfAj 4 3:f6r Wind f\,\l"t me. J*t
,!/- M< t\*-AJt*tt a* *3.\ fa '/«***<
me
5f Food stamp benefits are based on the AFDC grants shown and assu
deductions of $85 monthly (standard household deduction).
hly,
6J Administration's Proposal standardize work expense at $75 mont
hly per child,
prorate for part-time work; cap child care disregard at $50 mont
(1) flat $30;
and apply the disregards for recipients in the following order:e work; (3) actual
(2) standard allowance of $75, prorated for less than full-tim
third of the
child care expenses up to $350 per child per month; and (4) oneineligible for the
rest of income. As under current law, applicants would beings
J, only expenses
$30 plus one-third work incentive bonus. From their earn
.
would be deducted. The calculations assume no child care expenses
($30 plus
l_l Administration's Proposal withdraw the work incentive bonu4s straight
, after
one-third disregard) after 4 straight months of work. Thus
of (1) the standard
months of work a recipient would only be allowed a disregard work
, and (2)
allowance of $75 per month, prorated for less than full time
ulations
actual child care expenses up to $50 per child per month. The calc
shown in the table assume no child care expenses.
THE EFFECT OF SELECTED REAGAN ADMINISTRATION PROPOSALS
ON CASH PLUS I COD STA11P INCOME OF AFDC RECIPIENTS
(Family of 3)
PHILADELPHIA
Current Law If
Earnings 2J
$0
145
290
436
581
Income and
Payroll Taxes 3/
$0
13
(I/A time)
25
(1/2 time)
39
(3/4 time)
(full time) 72
1.
Earned Income AFDC
Grant 4/
Tax Credit
$0
14
29
42
32
$318
262
167
86
29
Food Stamp
Benefit 5/
$113
92
82
68
53
Cash Plus
Food Stamp
(After
Tax)
$431
500
543
593
623
Administration's Proposal for Ceiling on Gross Income
150 perIf gross income (earnings + earned income tax credit) is greater than
y
cent of the State's need standard ($477; 150 percent x $318), then the famil
does not receive an AFDC grant.
2. Administration's Disregard Proposal (First 4 months of job) 6/
*
$0
145
290
436
581
$0
13
(1/4 time)
25
(1/2 time)
39
(3/4 time)
(full time) 72
3.
$0
145
290
436
581
$0
14
29
42
32
$318
245
150
56
0
$113
97
87
77
62
$431
488
531
572
603
Administration's Disregard Proposal (After 4 months on job) 7/
$0
13
(1/4 time)
25
(1/2 time)
39
(3/4 time)
(full time) 72
$0
14
29
42
32
$318
178
37
0
0
$113
118
121
94
62
$431
442
452
533
603
TT
i
CHS 2Z
es* Other work expense (e.g.,
I/ Calculations assume no child care expens (bus fare
.65 cents, $1.30
thly
mon
$28
at
d
ume
ass
is
e)
ens
exp
on
ati
ort
nsp
tra
mos./yr - $28/mo.) for a threeday x 5 days/wk. >. 52 wks./yr. divided by 12 month (based on a 3-day work week
fourth time and full-time worker and $17 per
lf time work. In Pennsylvania a
-ha
one
and
e
tim
h
urt
-fo
one
a
for
28)
x
3/5
allowable.
"reasonable" child care expense disregard is
- $3.35/hour. The average earn2/ Earnings are based on the minimum wage imately $423 per month.
approx
ings of AFDC recipients in Pennsylvania is
1 per month, State and city
$58
and
6,
$43
0,
$29
5,
$14
of
gs
nin
ear
For
37
The Federal income tax was $20
.
ely
tiv
pec
res
,
$13
and
$10,
$6,
$3,
e
wer
taxes
Income taxes are based on
$0.
ise
erw
oth
y,
thl
mon
1
$58
to
al
equ
gs
for earnin
to 6.65 percent of income.
the 1980 tax rates. Payroll taxes are equal
r r, imii
4/ Tim LhrliteHBgawfril. i mupPiUiLiOu LJij»inr
culating the AFDC grant.
axes as shown in the tables are used in cal
C grants shown and assume
V Food stamp benefits are based on the AFD ion).
deduct
deductins of $85 monthly (standard household
work expense at $75 monthly,
6/ Administration's Proposal standardize ard at $50 monthly per child,
disreg
prorate for part-time work; cap child care
the following order: (1) flat $30;
and apply the disregards for recipients in less than full-time work; (3) actual
(2) standard allowance of $75, prorated for
month; and (4) one-third of the rest
child care expenses up to $50 per child pers would be ineligible for the $30
of income. As under current law, applicant
their earnings, only expenses would
plus one-third work incentive bonus. From
ld care expenses.
be deducted. The calcualtions assume no chi
work incentive bonus ($30 plus
7J Administration's Proposal withdraw the
of work. Thus, after 4 straight
one-third disregard) after 4 straight monthsowed a disregard of (1) the standard
months of work a recipient would only be alls than full time work, and (2) actual
allowane of $75 per month, prorated for les
month. The calculations shown in
child care expenses up to $50 per child per
the table assume no child care expenses.
CRS-2;
THE EFFECT OF SELECTED REAGAN ADMINISTRATION PROPOSALS
ON CASH PLUS FOOD STAMP INCOME OF AFDC RECIPIENTS
(Family of 3)
ATLANTA
Cash Plus
Current Law I/
Earnings 2/
$0
145
290
436
581
Income and
Payroll Taxes 3/
$0
10
(1/4 time)
19
(1/2 time)
29
(3/4 time)
(full time) 61
1.
'
Food Stamp *
Earned Income AFDC
Grant 4/
Tax Credit
$0
14
29
42
32
$164
101
3
0
0
Food Stamp
Benefit
$159
141
131
94
62
(After
Tax)
$323
391
434
543
614
Administration's Proposal for Ceiling on Gross Income
If gross income (earnings + earned income tax credit) is greater than 150 percent of the State's need standard ($289.5; 150 percent x $193), then the family
does not receive an AFDC grant.
2- Administration's Disregard Proposal (First 4 months of job) 6/
$0
145
290
436
581
$0
10
(1/4 time)
19
(1/2 time)
29
(3/4 time)
(full time) 61
3.
$0
145
290
436
581
$0
14
29
42
32
$164
91
0
0
0
$159
144
132
94
62
$323
384
432
543
614
Administration's Disregard Proposal (After 4 months on job) 7/
$0
10
(1/4 time)
19
(1/2 time)
29
(3/4 time)
(full time) 61
$0
14
29
42
32
$164
24
0
0
0
$159
164
132
94
62
$323
337
432
543 I
614 '
CRS-24
lanta allows "reasonAt
*
es
ns
pe
ex
re
ca
d
il
ch
I/ Calculations assume no disregarded. Other work expenses (i.e., transto be
able """child care expenses med at $22 per month (bus fare .50 cents; $l/day x 5
portation expense) is assuvided by 12 mos./yr. * $22) for a three-fourths time
days/wk. x 52 wks./yr. di 3 (based on a 3-day work week 3/5 x 22) for a one$1
and full time worker and ti
me worker.
fourth time and one-half
nimum wage - $3.35/hour.
mi
e
th
on
d
se
ba
e
ar
gs
in
rn
21 Ea
re $2, otherwise
we
s
xe
ta
ty
ci
d
an
e
at
St
h,
r mont
3/ For earnings of $581 spe $20 for earnings of $581 per month, otherwise $0.
ual
x wa
$0. The Federal income tae based on the 1980 tax rates. Payroll taxes are eq
The income tax figures ar
to 6.65 percent of income.
<
grant. '' ' -" DC
AF
e
th
g
in
at
ul
lc
ca
in
es are used
*Taxes~"as shown in itthebe taSbl
O f&r & r/V *n«
ants shown and assume
gr
DC
AF
e
th
on
d
se
ba
e
ar
5/ Food stamp benefits ndard household deduction).
ta
deductions of $8 monthly (s
rk expense at $75 monthly,
wo
e
iz
rd
da
an
st
al
os
op
Pr
67 The Administration's p child care disregard at $50 monthly per child,
ca
prorate for part-time work;r recipients in the following order: (1) flat $30; al
and apply the disregard fo $75, prorated for less than full-time work, (3) actust
(2) standard allowance of $50 per child per month; and (4) one-third of the re
child care expenses up toions assume no child care expenses.
of income. The calculat
ntive bonus ($30 plus
ce
in
rk
wo
e
th
aw
dr
th
wi
al
77 Administration's Proposraight months of work. Thus, after 4 straight
A st
rd
one-third disregard) aftert would only be allowed a disregard of (1) the standa
me work, and (2)
ti
ll
months of work a recipien
fu
an
th
ss
le
r
fo
ed
at
pror
allowance of $75 per month, up to $50 per child per month. The calculations
actual child care expenses no child care expenses.
shown in the table assume