"Federal Unemployment Tax Rate Increase - Excel"
LIS variable V2 Mandatory Employer Contributions FICA payroll tax (or Social Security Tax) Contents Federal retirement payroll deduction (national programs) FUTA tax (Federal Unemployment Tax) (NOT INCLUDED IN ORIGINAL SURVEY) Federal Insurance Contributions Act (FICA). Legislation Federal Unemployment Tax Act (FUTA) FICA: All private employers. Federal government tax: Federal government. Coverage FUTA: employers who either employ one or more individuals in each of 20 different weeks in a calendar year or pay wages of US$ 1,500 or more during any calendar quarter in the current or preceding calendar year. FICA tax: global contribution for Social Security benefits (old-age, survivors and disability benefits), and hospital insurance or Medicare. FUTA tax : Unemployment Compensation related expenditures (federal and state administrative Financed programs costs, federal share of benefits paid under the Extended Unemployment Compensation Act of 1970, loan fund from which an individual state may borrow in case of need, benefits under some federal supplemental and emergency program), plus some active labor measures. The FICA tax has two components: OASDI -- The old age, survivor and disability portion of the tax (6.2%) is paid on wages up to the maximum covered wage base for the year (US$ 87,900 in 2004). FICA tax HI -- The hospital insurance or Medicare portion of the tax (1.45%) is paid on all wages, without limit. Amount Note that these rates are identical to those paid by the employee (Table V11). Federal Government Tax 6.2% on wages up to US$ 7,000 a year per employee. There is a credit against federal tax liability of up to 5.4% to employers FUTA tax who pay State taxes timely under an approved State UC program, which implies that the effective FUTA rate for most employers if 0.8%. LIS variable V3 Non mandatory Employer Contributions Contents Employer contribution for health insurance (national programmes) Legislation Coverage Financed programs Amount LIS variable V7 Mandatory Contributions for Self-Employment Contents FICA payroll tax (or Social Security Tax) (national programmes) NB: THIS AMOUNT IS INCLUDED IN LIS VARIABLE V13 Legislation Federal Insurance Contributions Act (FICA) Coverage All incorporated self-employed. G lobal contribution for Social Security benefits (old-age, survivors and disability benefits), and Financed programs hospital insurance (Medicare). The self-employment combined rate (OASDI + Medicare) amounts to 15.3% (of net earnings), of which 12.4% for Social Security and 2.9% for Medicare. Amount The ceiling for OASDI tax portion on taxable self-employment income for 2004 was US$ 87,900; no limit on the Medicare tax portion. LIS variable V11 Income Taxes Contents Federal Income Tax (FIT) (national schemes) State income tax FIT: FIT on Social Security and pensions: First law in 1984, current law: Omnibus Budget Reconciliation Legislation Act (OBRA), 1993 State Income tax: different in each State. Coverage Income from all sources. See below (income base). Uses Part of general taxation. Joint filing system: the incomes of both spouses are added together and Federal income tax taxed as a single amount. Filing sytem Most States have a joint filing system, 8 have a combination of State income tax joint/combined, and Missouri has a combined one (the income of each spouse is taxed separately). The income subject to tax is the "modified taxable income", being equal to the taxable income, plus the sum of all children's interest and dividend income. Taxable income is derived by subtracting from Adjusted Gross Income (AGI, which consists of the tax unit total yearly income minus any adjustments to income (such as contributions to a traditional IRA or a retirement plan for self-employed individuals, contributions to medical savings account, student loan interest deduction, deduction of 1/2 of self- employment tax, deduction of 70% of self-employed health insurance, penalty on early withdrawal of savings, alimony payments, certain moving expenses, etc.), any exemption amount (personal and Federal income tax dependent, estate, simple trust, etc.) and either total itemised deductions or the standard deduction, composed of a basic standard deduction and an additional standard deduction for taxpayers aged 65 or over or blind. Standard deductions (base amount / addition): - married filing jointly or surviving spouse: US$ 9,700 / US$ 950; Income base - head of household: US$ 7,150 / US$1,200; - single: US$ 4,850 / US$ 1,200; - married filing separate: US$ 4,850 / US$ 950; - dependent standard deduction: US$ 800 / US$ 950. Most States use federal adjusted gross income as a starting point to determine the state tax, with the main differences from the federal taxable income being in the following areas: Social Security (where 29 States exempt Social Security income from taxation and 9 provide their own taxation scheme), capital gains, unemployment compensation State income tax (where 8 states exempt them from tax), state and municipal bond (which is taxed only at the state level, and exempt in many parts), military pay (where a few states provide a partial or total exemption), and retirement/pension income (most states provide state tax exclusions). New Hampshire and Tennessee tax only unearned income (such as interests and dividends). There are six tax rates (10% / 15% / 25% / 28% / 33% / 35%) for each of six income tax brackets; the income tax brackets vary by filing status, the second lowest bracket includes income up to US$ 58,100 for married filing jointly or qualifying widow(er)s; US$ 38,900 for heads of household; Federal income tax US$ 29,050 for singles; and US$ 29,050 for married filing separately. The highest income tax bracket for each of these statuses is over US$ 319,101 (MFJ/QW) / US$ 319,101(S) / US$ 319, 101 (HH) / and US$ Amount 159,551 (MFS). Child's interest and dividend income is taxed at a 10% rate. 43 States have a state individual income tax, six states (Colorado, Illinois, Indiana, Massachusetts, Michigan and Pennsylvania) have a flat- rate (4.6%, 3.0% 3.4%, 5.3%, 4.0%, and 3.07%, respectively) two states State income tax (New Hampshire and Tennessee) limit income tax to dividend and interest income, in the remainder there is a range of income tax brackets (3-10) and tax rates (from 0.36% to 11%). LIS variable V13 Mandatory Employee Contributions FICA payroll tax (or Social Security Tax) Contents Federal retirement payroll deduction (incl. Railroad Retirement Tax Act - RRTA?) (national programmes) NB: ALSO INCLUDES CONTRIBUTIONS FOR SELF-EMPLOYED - SEE V7 Legislation Federal Insurance Contributions Act (FICA) FICA: All private employees. Coverage Federal government tax: Federal government employees. FICA tax: global contribution for Social Security benefits (old-age, survivors and disability benefits), Financed programs and hospital insurance or Medicare. The FICA tax is composed of two elements: 1. OASDI -- The old age, survivor and disability portion of the tax (6.20%) is paid on wages up to the maximum covered wage base for the year (US$ 87,900 in 2004). FICA tax 2. HI -- The hospital insurance or Medicare portion of the tax (1.45%) is Financing paid on all wages, without limit. Note that these rates are identical those payable by the employer (Table V2). Federal Government Tax LIS variable V17SR Occupational injury and disease benefits n.e.c. Worker's compensation: - private employers and state and local governments' insurances administered by the state workers' compensation boards; Contents - the Department of Labor's Office of Workers' Compensation Programs (OWCP) for federal (national programs) employees (incl. the Energy Employees Occupational Illness Compensation Program, the Federal Employees' Compensation program, the Longshore and Harbor Workers' Compensation Program and the Black Lung Benefits Program). First laws: 1908 (federal employees) and 1911 (10 State laws); 4/5 of all state laws enacted before Legislation 1920. Compulsory (elective in 3 states) insurance through public or private carrier (according to State) or Coverage self-insurance for all employers, covering all private and public employees and their dependents. Qualifying conditions Being disabled as a result of a work injury or an occupational disease. 66.6% of earnings in most States. About 1/5 of States also provide supplements for dependents. Temporary disability Maximum benefit: The maximum weekly benefit varies by State. Benefits paid retroactively if injury lasts a specified period, ranging from 3 days to 6 weeks. Total disability: a pension of 66.6% of earnings is payable in most States; pneumoconiosis: the basic monthly benefit is US$ 549 , the maximum monthly family pension is US$1098; constant attendance and dependents' supplements provided in some States; payable for life or for Benefits Permanent disability the duration of the disability in 4/5 of States, but only for 104-500 weeks in others. Partial disability: proportionate to wage loss, or full rate for fewer weeks in case of scheduled injuries. Survivor pension: 35-70% of earnings of insured for widow; 60-80% for a widow(er) with dependent children. Pneumoconiosis: same as disability benefit. Survivor Other eligible survivors (some work-injury laws and pneumoconiosis): dependent parents, brothers and sisters. Funeral grant: lump sum is paid. The amount varies by state. Accumulation with other income Adjustment About 4/5 of States have benefits that increase automatically with State wages. OWCP programs are financed by the Government. All state funds are, by law, self-supporting from their premium and investment revenue. As nonprofit departments of the state, or as independent nonprofit companies, they are able to return surplus assets Financing principle to their policyholders as dividends or safety refunds. This reduces the overall cost of workers' compensation insurance. Numerous court Financing decisions have determined that the assets, reserves, and surplus of the funds are not public funds, but are the property of employers who are insured by the funds. In a few states there is a nominal contribution by the employee. Taxation Contributions from benefits No contributions. LIS variable V18S1 Disability pensions Disability insurance benefits from: - Social Security - US military insurance Contents - State and local government employee insurance (national programs) - US railroad insurance Please note that only the rules pertaining to Social Security are described below. Please refer to V23 for disability insurance from US military insurance and US railroad insurance programs. Legislation First and current law: Social Security Act, 1935, with various amendments Gainfully occupied persons, including self-employed persons. Exclusions: casual agricultural and domestic employment, and limited self-employment (when annual net income is below US$ 400), and some Federal employees hired before 1984. Voluntary coverage for employees of State and local governments, and clergy (mandatory Coverage coverage for employees of State and local governments not covered under a retirement system, effective July 1, 1991). Pensions are payable abroad to non-citizens under reciprocal agreement. However, non-citizens' dependents who were first eligible after 1984 generally must meet a residency test. Inability to engage in substantial gainful activity due to a mental or physical impairment expected to last at least one year or result in death. Insured: Must have one quarter of coverage for each year since age 21 up to the year disability Qualifying conditions began to a maximum of 40 quarters of coverage. Also 20 quarters of coverage in the 10-year period before the onset of disability. There are more relaxed requirements for the young and blind. Covered earnings averaged over period after 1950 (or age 21, if later) Earnings reference and indexed for past wage inflation, up to onset of disability, excluding up to 5 years with the lowest earnings. Minimum No minimum benefit for workers becoming disabled after 1981. Maximum US$ 1,741 a month for workers becoming disabled in 2003. Disability insurance benefits are automatically converted into retirement Benefits insurance benefits the month in which the beneficiary reaches age 65. Duration The 2003 maximum monthly benefit is U.S.$552 for an individual or Means tested U.S.$829 for a couple. Benefit adjustment: Benefits are adjusted supplemental disability annually for cost-of-living changes. If entitled to more than one Social Security benefit, only the higher benefit is payable, unless one of the benefits is either: a retirement or disability insurance benefit or both benefits are child's insurance benefits. The lower benefit cannot be paid even if the higher benefit is not payable due to a suspension or deduction reason. However, if the higher benefit is terminated, the lower benefit will be automatically reinstated if the person is still entitled to it. Work after entitlement to any type of Social Security benefit or railroad annuity affects eligibility to Accumulation with other receive monthly payments. income Entitlement to both Social Security benefits and railroad annuities is possible through a combined amount. Social Security disability insurance benefits may be reduced if receiving worker's compensation or certain other government disability benefits. Or, Social Security benefits may reduce other disability payments. The sum of all disability payments to a family cannot exceed 80 percent of the insured earnings averaged over a period of time shortly before the disability began. Adjustment Automatic cost-of-living adjustment. Employer, employee and self-employed contributions (see V2, V7 and Financing principle V13) No benefits are subject to tax unless total provisional income (adjusted gross income, tax exempt interest, and one half of Social Security benefits) exceeds a base amount. Provisional income may also include amounts earned in a foreign country that are excluded from gross income. The base amount is US$ 25,000 for singles and US$ 32,000 for married couples filing jointly. Benefits over these thresholds are taxed at a 50% rate. Financing Taxation If provisional income exceeds these limits, but is less than the higher income thresholds (US$ 34,000 for single filers and US$ 44,000 for joint filers), the taxable portion of benefits is the lesser of 50% of net benefits or 50% of the amount by which provisional income exceeds the base amount, otherwise, the lesser of 85% of net benefits or the amount included under the old law plus 85% of the excess of provisional income over the higher income thresholds. Contributions from No contributions. benefits LIS variable V19S1b Employment-related old-age pensions Retirement (or old-age) basic benefit (from Social Security) Supplements to Contents Social Security pension (auxiliary benefits) for: (national programmes) - child - dependent spouse. Legislation First and current law: Social Security Act, 1935, with various amendments Coverage See V18S1 for coverage of Social Security. Effective for workers retiring at age 65 in 2003, the age at which one can receive an unreduced benefit (the full retirement age) has been raised Standard retirement age from age 65 to age 65 and 2 months. The full retirement age will increase gradually to age 67 by 2027. 40 quarters of coverage (QC) is required. The number of required QC is Minimum period reduced for those reaching 62 before 1991. Qualifying conditions Paid to each child (or dependent grandchild) under the age 18 or age 18- Child 19 and attending elementary or secondary full-time school (no age limit if disabled before age 22). Paid to wife or husband (or divorced spouse, if marriage lasted 10 years) at the full retirement age (reduced if age 62 up the full retirement age) or Dependent spouse to a wife or a husband at any age caring for a child under age 16 or disabled. Covered earnings averaged over period after 1950 (or age 21 if later), and indexed for past wage inflation, up to age 62 (or death, if earlier) excluding 5 years with the lowest earnings. Earnings in years outside this Earnings reference period may be substituted if higher. The pension is available at age 62 but is reduced for each month of receipt prior to the full retirement age. Minimum No minimum benefit for workers reaching age 62 after 1981. US$ 1,741 a month for workers retiring at the full retirement age in 2003. Maximum An increment is provided for each month the insured delays retirement at Benefits the full retirement age, up to age 69. The increment amount depends on Deferment the year the insured person reached age 62. In 2003, the increment is 7.5% a year for those aged 62. Individual benefit for 50% of the insured's pension Supplements Maximum family pension ranges from 150% to 188% of worker's basic old-age pension and from 100% to 150% of disabled basic pension. Maximum family benefit Maximum family benefit for worker retiring at the full retirement age in 2003, US$ 3,047 a month, and for a worker becoming disabled in 2003, US$ 2,929 a month. See V18S1 on entitlement to more than one Social Security benefit, on work after entitlement to Accumulation with other any type of Social Security benefit and to entitlement to both Social Security benefits and railroad income annuities. Adjustment Automatic cost-of-living adjustment. Employer, employee and self-employed contributions (see V2, V7 and Financing principle V13) Financing Taxation See V18S1 for taxation of Social Security benefits. Contributions from No contributions. benefits LIS variable V19S1c Old-age pensions for public sector employees Old-age pensions from: - State or local government insurance - US railroad insurance Contents - US military insurance (national programmes) Note: Veterans' disability and survivors benefits are described in V23 “Military/veterans/war benefits; Only retirement benefits are described below Civil Service Retirement System (1920). ERISA 1974 (Employee Retirement Income Security Act). Legislation Federal Employees Retirement System and Thrift Savings Plan (1984, for employees hired after 1984). USERRA 1994 (Uniformed Service Employment and Re-employment Rights Act) State and local 90% of all state and local workers are covered by a pension plan retirement programs (defined benefit). Protection for persons who work for railroads and certain companies US railroad closely connected with the railroad industry, and their dependents. Coverage Over 25 million veterans living today and about a quarter of the nation's population -- approximately 70 million people -- are potentially eligible for US military insurance VA benefits and services because they are veterans, family members or survivors of veterans. Rules may vary among the 50 state governments and the thousands of State and local local governments that have pension plans. retirement programs Retirement : * Must be honorably discharged; *Served 90 days or more of active duty with at least 1 day during a period of war time. Anyone who enlists after 9/7/80 generally has to serve at least 24 months or the full period for which a person was called or ordered to US military insurance active duty in order to receive any benefits based on that period of service. * Be permanently and totally disabled, or are age 65 or older, AND *countable family income is below a yearly limit set by law (In 2007 Qualifying conditions $11,181 for a single veteran with no dependents; $14,643 for veteran with a spouse or child). Retirement : a railroad retirement annuity can be received as early as age 60. The length of service determines points of eligibility. Disability : a disability annuity is payable to persons with at least 10 years of railroad employment and who are totally disabled or who have at least 20 years of service and become partially disabled (unable to US railroad perform their regular jobs). Survivors' : survivor annuities are payable to: spouse or divorced spouse of retired insured, widow(er) and surviving divorced spouse, remarried widow(er)s, children, and parents upon the insured's death; a lump-sum may be payable because of insured death if there are no survivors immediately eligible to receive a monthly annuity upon death. The average pension payout for state and local retirees was US $16,168 State and local (2003). retirement programs Retirement: The Veterans Administration pays the difference between countable family income and the applicable yearly income limit (see US military insurance qualifying conditions). This difference is paid in 12 equal monthly Benefits payments rounded down to the nearest dollar. Covered earnings averaged over period after 1950 (or age 21 if later), and indexed for past wage inflation, up to age 62 (or death, if earlier) US railroad excluding 5 years with the lowest earnings. Earnings in years outside this period may be substituted if higher. Work after entitlement to any type of railroad annuity affects eligibility to receive monthly payments. Accumulation with other Entitlement to both Social Security benefits and railroad annuities is possible through a combined income amount. Adjustment Automatic cost-of-living adjustment. Financing principle Employer and employee contributions (see V2 and V13) Railroad annuities : subject to Federal income tax in the following way: the Social Security equivalent portion of tier I benefit (These benefits are taxed the same way as Social Security benefits; Tier II and the non- Taxation Social Security equivalent portion of tier I benefits are taxable in the Financing same way as contributory private and public service pensions; and vested dual benefits and the supplemental annuity are taxable in the same way as non-contributory private and public service pensions. Contributions from No contributions. benefits LIS variable V19S4 Survivors pensions Survivors' insurance benefits from: - Social Security - US military insurance Contents - State of local government employee insurance (national programmes) - US railroad insurance Please note that only the rules pertaining to Social Security are described below. Legislation First and current law: Social Security Act, 1935, with various amendments Coverage See V18S1 for coverage of Social Security. Deceased was pensioner or had 1 QC for each year since 21 and before the year of death; maximum, 40 QC's. Qualifying conditions Reduced requirements for orphans and non-aged widow with eligible orphan in her care: 6 QC's in 13 quarters preceding death. 100% of deceased insured worker's pension at age 65 (reduced for 60- 64); reduced pension if disabled at age 50-59; payable to widow or Widow(er) or surviving widower or surviving divorced spouse, if marriage lasted 10 years. divorced spouse: 75% of worker's pension for widow or widower or surviving divorced spouse at any age caring for child under the age of 16. 75% of worker's pension for each child under the age 18 or age 18-19 Orphans and attending elementary or secondary school full-time, (no age limit if Benefits disabled before age 22). Dependent parent(s) 82.5% of worker's pension at age 62, or 150% for 2 eligible parents. Maximum total family pension : based on worker's pension. Maximum total family Maximum total family benefit, assuming worker died at age 65 in 2003: US$ 3,466 a month. Special One-Time Death A special one-time payment will be made to the widow(er) or minor Benefit children if enough credits were earned. See V18S1 on entitlement to more than one Social Security benefit, on work after entitlement to Accumulation with other any type of Social Security benefit and to entitlement to both Social Security benefits and railroad income annuities. Adjustment Automatic cost-of-living adjustment. Employer, employee and self-employed contributions (see V2, V7 and Financing principle V13) Financing Taxation See V18S1 for taxation of Social Security benefits. Contributions from No contributions. benefits LIS variable V20SR Child/family benefits n.e.c. Contents Social Security payments on behalf of surviving, dependent or disabled child (national programmes) Legislation First and current law: Social Security Act, 1935, with various amendments Coverage See V18S1 for coverage of Social Security. Qualifying conditions Benefits See V18S1 on entitlement to more than one Social Security benefit, on work after entitlement to Accumulation with other any type of Social Security benefit and to entitlement to both Social Security benefits and railroad income annuities. Adjustment Automatic cost-of-living adjustment. Employer, employee and self-employed contributions (see V2, V7 and Financing principle V13) Financing Taxation See V18S1 for taxation of Social Security benefits. Contributions No contributions. LIS variable V21S1 Unemployment insurance benefits Federal-State Unemployment Insurance Program Contents Supplemental unemployment benefits (national programmes) Unemployment or strike benefits from union funds First law: Social Security Act of 1935. Each State administers a separate unemployment insurance program within guidelines established by the Federal law (mainly the Social Security Act and the Federal Unemployment Tax Act). Legislation Additionally, private companies and union funds can pay benefits during periods of unemployment and strike. All wage and salary workers (excluding railroad workers, veterans and civilian federal employees Coverage who are covered by separate programs). i) meet the State requirements for wages earned or time worked during an established (one year) period of time referred to as base period (in most States this is usually the first four out of last five Qualifying conditions completed calendar quarters prior to the time that the claim is filed); ii) be unemployed through no own fault (determined under State law); iii) meet other eligibility requirements of State law. Benefits can be paid for a maximum of 26 weeks in most States (30 in 2 States). Duration Up to 13 (20 in some States) additional weeks of benefits may be available during times of high unemployment; some States provide additional benefits for specific purposes. In general, benefits are based on a percentage of an individual's Amount earnings over a recent 52-week period - up to about 50% of earnings, according to diverse state formulas. In periods of very high and rising unemployment in individual States, Extended benefits benefits can be paid for up to 13 (20 in some States) additional weeks; Size of benefits some States provide additional benefits for specific purposes. About 1/4 of states provide from U.S.$1 to U.S.$95 a week for each child and sometimes for other dependents. The benefit is payable after a 1- Dependents' supplement week waiting period in most states for up to 26 weeks, according to the state. Assistance is available in some states to workers who are ineligible Unemployment because of insufficient periods of covered employment and to needy assistance unemployed persons who have exhausted benefit rights under the federal/state assistance programs. Accumulation with other Partial employment benefit is payable for part-time work. income Adjustment Normal benefits: Federal tax: 0.8% of taxable payroll (6.2% basic rate minus a basic rate up to the 5.4% state contribution; includes the temporary basic rate of 0.2%) on the first U.S.$7,000 annually. The base has been raised in 49 jurisdictions. State programs: A basic rate of 5.4% Financing principle in most states; actual rates vary from zero to 10% or more, according to the individual employer's experience. Financing Extended benefits: Federal government pays for the administration of state programs from the federal tax. The balance is used for loans to states or to finance the extended benefit program. Benefits are subject to Federal income taxes. Taxation Contributions from None. benefits LIS variable V23 Military/veterans/war benefits Contents Veterans' Administration benefits (incl. veteran's pension (disability and death), disability and survivor compensation, (national programmes) education benefits and other veteran's payments) Legislation Coverage Veterans and their dependents and survivors. Benefit payable to the person who paid for a veteran's burial or funeral; the person must not have been reimbursed by another government agency or some other source, such as the deceased veteran's employer, and the veteran must have been discharged under conditions other than dishonorable. In addition, at least one of the following conditions must be met: the Burial Allowance veteran died because of a service-related disability, or the veteran was receiving VA pension or compensation at the time of death, or the veteran was entitled to receive VA pension or compensation but decided not to reduce his/her military retirement or disability pay, or the veteran died in a VA hospital or while in a nursing home under VA contract, or while in an approved state nursing home. Pension is available to veterans if the veteran has qualifying service and there is financial need. Veterans must also have a qualifying disability which need not be service-connected. More specifically: Disability pension must have been discharged from service under other than dishonorable conditions, and must have served 90 days or more of active duty with at least 1 day during a period of war time, and must have disabilities that keep from working a regular, full-time job, and the countable family income must be below a yearly limit set by law. Basic entitlement for a veteran exists if the veteran is disabled as the result of a personal injury or disease (including aggravation of a condition existing prior to service) while in active service if the injury or the disease was incurred or aggravated in line of duty. This benefit program evaluates disability resulting from all types of diseases and injuries encountered as a result of Disability compensation military service. The degrees of disability that are determined by VA represent, as far as can practicably be determined, the average loss in wages resulting from such diseases and injuries and their complications in civil occupations. Generally, the degrees of disability specified are also designed to compensate for considerable loss of working time from exacerbations or illnesses. Basic entitlement exists for a surviving spouse, children, and dependent parents. Benefit levels vary by enlisted pay grade and whether: Dependency and - the veteran died on or after January 1, 1993; or Indemnity - the veteran died before January 1, 1993. Compensation (DIC) Benefit levels also vary depending on whether the surviving parent(s) live with the deceased's spouse and whether the surviving parent has remarried or not. Note: only the benefit data for Qualifying conditions surviving spouse and children is given below. Education benefits are payable to cover the costs of degree and certificate programs, flight training, apprenticeship/on-the-job training and correspondence courses; remedial, deficiency, and refresher courses may be approved under certain circumstances. The main benefits available are: - Montgomery GI Bill: the Active Duty MGIB program provides education benefits to all persons on Active Duty (generally, benefits are payable for 10 years following your release from active duty); members of the Selected Reserve are eligible for the Selected Reserve MGIB-SR. - Veterans Educational Assistance Program (VEAP): must have entered active duty between January 1, 1977 and June 30, 1985 and must be elected to make contributions from military pay to participate in this education benefit program; Education benefits - Survivors' and Dependents' Educational Assistance Program (DEA): DEA provides education and training opportunities to eligible dependents of veterans who are permanently and totally disabled due to a service-related condition, or who died while on active duty or as a result of a service related condition; - Work-Study Program: available to any student receiving VA education benefits who is attending school three-quarter time or more; an individual working under this program may work at the school veterans' office, VA Regional Office, VA Medical Facilities, or at approved State employment offices; - Tutorial Assistance Program: must be receiving VA educational assistance at the half-time or more rate and must have a deficiency in a subject making tutoring necessary. Assistance for Homeless Veterans Filipino Veterans: benefits to New Philippine Scouts and benefits available to Commonwealth Army (USAFFE) and Recognized Guerrillas Other benefits Former Prisoners of War (POWs) Home Loan Guaranty Benefits Incarcerated Veteran Benefits Service-Disabled Veterans Insurance (RH) Benefit paid to eligible dependents of deceased wartime veterans. More specifically: the deceased veteran must have been discharged from service under other than dishonorable Survivor conditions, and he or she must have served 90 days or more of active duty with at least 1 day during a period of war time, and the applicant must be the surviving spouse or unmarried child of the deceased veteran, and the countable income is below a yearly limit set by law. Service-Related Death:. VA will pay up to US$ 1,500 toward burial expenses for deaths prior to September 10, 2001; for deaths on or after September 11, 2001, VA will pay US$ 2,000; if the veteran is buried in a VA national cemetery, some or all of the cost of moving the deceased may be reimbursed. Burial Allowance Nonservice-Related Death: VA will pay up to US$ 300 toward burial and funeral expenses, and a US$ 150 plot interment allowance for deaths prior to December 1, 2001; the plot-interment allowance is $300 for deaths on or after December 1, 2001; if the death happened while the veteran was in a VA hospital or under contracted nursing home care, some of all of the costs for transporting the deceased’s remains may be reimbursed. The pension amounts to the difference between the countable family income and the yearly Disability and death income limit for that family situation. This difference is generally paid in 12 equal monthly pension payments rounded down to the nearest dollar. The amount of basic benefit paid ranges from $103 to $2,163 per month (2002), depending on degree of disability. Disability compensation Supplements for very severe disabilities or loss of limb(s), spouse, child(ren), or dependent parent(s), and seriously disabled spouse. If the veteran died before January 1, 1993: the basic monthly rate of DIC is US$ 993 for eligible surviving spouses. Additional amounts are added if the veteran was entitled to compensation for a service related disability subject to certain conditions; had dependent children under the age of 18; had a disabled spouse. Dependency and Indemnity If the veteran died on or after January 1, 1993: the variable pay rates (compensated by pay Compensation (DIC) grade) range from a base of US$ 993 to a maximum of US$ 2,272. Size of benefits When the surviving spouse is eligible for payments under the military’s Survivor Benefit Program (SBP), only the amount of SBP greater than DIC is payable. If DIC is greater than SBP, only DIC is payable. - Montgomery GI Bill: The MGIB program provides up to 36 months of education benefits. This benefit may be used for degree and certificate programs, flight training, apprenticeship/on-the- job training and correspondence courses. Remedial, deficiency, and refresher courses may be approved under certain circumstances. Generally, benefits are payable for 10 years following your release from active duty. This program is also commonly known as Chapter 30. For those completing an enlistment of three years or more US$ 1,004 (2004) was payable for full-time institutional training. Rates vary based on the type of training program and the duration of the training period. - Veterans Educational Assistance Program (VEAP): up to 36 months depending on the number of monthly contributions from military pay to participate (the contributions are matched on a $2 Education benefits for $1 basis by the Government). These benefits can be used for degree, certificate, correspondence, apprenticeship/on-the-job training programs, and vocational flight training programs. In certain circumstances, remedial, deficiency, and refresher training may also be available. VEAP is valid 10 years from discharge and after that time any used portion is refunded . - Survivors' and Dependents' Educational Assistance Program (DEA): the program offers up to 45 months of education benefits at a flat rate fixed by Congress depending on the type of training and the intensity (full-time, 3/4 or half-time). - Work-Study Program: work-study students are paid at either the state or Federal minimum wage, which ever is greater. Accumulation with other income Adjustment Financing principle Tax financed. Taxation Benefits are tax-free. Financing Contributions from No contributions. benefits LIS variable V24SR Other social insurance benefits n.e.c. Contents Other income from Social Security (national programmes) Legislation First and current law: Social Security Act, 1935, with various amendments Coverage See V18S1 for coverage of Social Security. Qualifying conditions Benefits See V18S1 on entitlement to more than one Social Security benefit, on work after entitlement to Accumulation with other any type of Social Security benefit and to entitlement to both Social Security benefits and railroad income annuities. Adjustment Automatic cost-of-living adjustment. Employer, employee and self-employed contributions (see V2, V7 and Financing principle V13) Financing Taxation See V18S1 for taxation of Social Security benefits. Contributions from No contributions. benefits LIS variable V25S1 General social assistance benefits Public assistance (PA) cash benefits, incl: * Aid to Dependent Children (ADC) from 1935-1997 (replaced by TANF) * General Assistance from Bureau of Indian Affairs (BIA GA) Contents * General Assistance / Emergency Assistance Program (national programmes) * Temporary Assistance for Needy Families (TANF) * Refugee Cash and Medical Assistance Program * Tribal Administered General Assistance * Welfare or Welfare to work program Immigration and Nationality Act in 1980 Legislation Social Security Act of 1935 Welfare Reform Law of 1996 Coverage All U.S. citizens or nationals residing in the US General assistance payments made by the Bureau of Indian Affairs must be made using the same TANF payment standard (and any associated rateable reduction) that exists in the state or service area where Bureau Of Indian Affairs the applicant or recipient resides. This payment standard is the amount from which the Bureau subtracts General Assistance (BIA GA) net income and resources to determine General Assistance eligibility and payment levels. If a state does not have a TANF program than the AFDC standard which was in effect in the state on Sept. 30, 1995 is used. The Division of Family Assistance (DFA) provides Emergency Assistance (EA) in the form of payments to vendors for permanent housing for families that meet the eligibility requirements for TANF program. Receipt of TANF benefits is not required. EA payments can be applied to rent, mortgage and utility Emergency Assistance arrearages; rent and utility deposits; and fuel deliveries. EA payments allow families eligible for TANF to Programs obtain or retain safe and healthy housing. Applicants for EA must be experiencing or threatened by one or more of the following: homelessness, termination of a utility, or lack of heat, hot water or cooking fuel. The emergency situation must not be caused by an adult family member's refusal to accept or continue with employment or training. There are ten such programs because of space limitations only general qualifications for two of the major programs follow: The Division of Refugee Assistance (DRA) was created to oversee and provide guidance to State- administered programs that provide assistance and services to refugees, asylees, certain Amerasian immigrants, Cuban and Haitian Entrants, and Victims of Human Trafficking (henceforth referred to collectively as “refugees”). DRA monitors program planning, provision of services, and provides technical assistance to ensure compliance with federal regulations governing the delivery of refugee assistance and services, including cash and medical assistance. This will enable refugees to become employed and Refugee Assistance programs economically self-sufficient as soon as possible after their arrival in the United States. Qualifying conditions The State Department identifies refugee children overseas who are eligible for resettlement in the U.S., but do not have a parent or a relative available and committed to providing for their long term care. Upon arrival in the U.S., these refugee children are placed into the Unaccompanied Refugee Minors (URM) program and receive refugee foster care services and benefits. Refugee children who enter the U.S. with family but experience a family breakdown may be eligible to participate in the URM program. Children eligible for the URM Program are under age 18, are unaccompanied, and are: refugees, entrants, asylees, victims of trafficking. Recipients must work as soon as job ready, or no later than two years after coming on assistance. In FY1997, each State had to ensure that 25% of all families in the state were engaged in work activities. This percentage increased to 50% in fiscal year 2002. Minimum participation rates for two-parent families started at 75% in FY 1997. During 1997, single parents had to participate in work activities for at least 20 hours per week. Two-parent families had to participate in work activities for at least 35 or 55 hours per week, depending upon the circumstances. Failure to participate in work requirements can result in a reduction or a termination of benefits to the family. However, states cannot penalize single parents with a child under six for failing to meet work requirements if they cannot obtain child care. A state may exempt TANF single parents with children under the age of one from the work requirements and disregard these individuals in the calculation of participation rates for up to twelve months. Activities that count towards a state's participation rates are: unsubsidized or subsidized employment, on- the-job training, work experience, community service, job search, vocational training, job skills training related to work, or education directly related to work; satisfactory secondary school attendance; and providing child care services to individuals who are participating in community service Families with an adult who has received federally-funded assistance for a total of five years (or less at state option) are not eligible for cash aid under the TANF program. States may extend assistance beyond Bureau Of Indian Affairs 60 GA payments 20 percent of their caseload. BIAmonths to up toare unearned income. BIA GA payments are Federally-funded income based on need. General Assistance (BIA GA) They are paid in cash or in-kind. Availability of EA payments is limited. Applications received after available funds are depleted must be Emergency Assistance denied. With some exceptions, recipients of EA payments are generally allowed to have a vendor paid Program with EA funds only once in a 12 month period. Federal funds are provided to States to help offset necessary costs. Eligibility for refugee cash assistance is subject to the availability of funding. A major emphasis is on increasing refugee employment and reducing welfare dependency. Among the ten such benefit programs include: Cash and Medical Assistance Program provides reimbursement to States and alternative refugee assistance programs for 100 percent of Refugee Cash Assistance (RCA)and Refugee Medical Assistance (RMA) provided to refugees and other eligible persons, as well as associated administrative costs. Unaccompanied Refugee Minors Program . Benefits include foster care, education, welfare and family tracking programs to find separated minors natural parents. Benefits Refugee Social Services Program allocates formula funds to States to serve refugees in the U.S. less Refugee Assistance programs than sixty months (five years). This program supports employability services and other services that address participants’ barriers to employment such as: social adjustment services, interpretation and translation services, (day care for children), citizenship and naturalization services, etc Targeted Assistance Program allocates formula funds to States for counties that qualify for additional funds due to an influx of refugee arrivals and a high concentration of refugees in county jurisdictions with high utilization of public assistance. Cuban Haitian Program provides grants to State and State-alternative programs to fund assistance and services in localities most heavily impacted by an influx of Cuban and Haitian entrants and refugees. The benefits consist of payments directed at ongoing, basic needs – even when individuals are participating in community service and work experience (or other work activities) as a condition of TANF receiving payments that address their basic needs. The programme excludes non-recurrent, short-term benefits designed to deal with individual crisis situations rather than ongoing need. These benefits cannot provide for needs that will extend beyond 4 Accumulation with other As long as the lower income and wealth limit are respected. income Adjustment Rates are automatically adjusted to reflect Consumer Price Index Index Fix (2.5% for 2000). Financing principle General tax revenues. Financing Taxation Benefits are not subject to taxation. Contributions from benefits No contributions. LIS variable V25S2 Old-age and disability assistance benefits Supplemental Security Income (SSI) for the elderly and the disabled/blind Contents Disability Supplemental Income (national programmes) Legislation Social Security Act of 1935 Coverage All U.S. citizens or nationals residing in the US (some noncitizens can qualify for SSI) The person must be over 65 and benefits are subject to a strict asset test. The limits are to $2,000 worth of assets for singles and $3,000 for Elderly couples, excluding personal belongings, a home, a car, funeral insurance and life insurance (the last two up to $1,500 value). The person must be either blind (either totally blind or have very poor eyesight) or disabled (physical or mental problem that keeps from working and is expected to last at least a year or to result in death), and Qualifying conditions he/she must satisfy wealth and income conditions as well (individuals must not have an income higher than US$ 2,000 and couples than US$ Disabled / blind 3,000). Disabled persons must accept vocational rehabilitation services if they're offered. A means tested disability supplemental income benefit is payable to disabled and blind persons younger than age 65. Certain impairment related work expenses are deductible from income. Single people over the age of 65 are eligible for up to U.S.$6,540 (2003) a year of supplemental security income (approximately 20 percent of average earnings), depending on assets and other income. The benefit rate for couples is 50 percent higher. States often supplement the federally determined minimum: 28 administer their own system and Benefits 12 offer supplements operated by the federal administration. The average additional payment in these 12 states is 13 percent for single pensioners and 18 percent for couples. Supplemental disability income provides a benefit of U.S.$552 for an individual or U.S.$829 for a couple. The means test is based on both earned and unearned income including benefits. Accumulation with other There is a small (US$20 a month) disregard. The benefit is then withdrawn at a 100 percent rate income against income above this level. Adjustment Benefits are adjusted annually for cost-of-living changes. Financing principle Tax financed. Taxation Benefits are not subject to taxation. Financing Contributions from No contributions. benefits Financed by the State. LIS variable V25S4 Parents assistance benefits Contents Supplemental Security Income (SSI) on behalf of disabled or blind children (national programmes) Legislation Social Security Act of 1935 Coverage All U.S. citizens or nationals residing in the US (some noncitizens can qualify for SSI) Qualifying conditions The basic SSI monthly amount is the same nationwide: US$ 552 for individuals and US$ 829 for Benefits couples. Moreover, many states supplement the SSI benefit for certain categories of recipients. Accumulation with other As long as the lower income and wealth limit are respected. income Adjustment Benefits are adjusted annually for cost-of-living changes. Financing principle Tax financed. Taxation Benefits are not subject to taxation. Financing Contributions from No contributions. benefits Financed by the State. LIS variable V25SR Social assistance cash benefits n.e.c. Contents Earned Income Tax Credit (EITC) (national programmes) 1975 Legislation Coverage Refundable income tax credit for low-income working individuals and families. Both the earned income and the modified adjusted gross income must be less than certain Qualifying conditions thresholds, which vary with family size and composition. The credit reduces the amount of Federal tax owed and can result in a Mechanism refund check; when the EICT exceeds the amount of taxes owed, it Benefits results in a tax refund to those who can claim and qualify for the credit. Amount Income and family size determine the amount of the EITC. Accumulation with other The EITC does not generally affect eligibility for Medicaid, Supplemental Security Income (SSI), income food stamps or low-income housing. Adjustment Financing principle Tax financed. Taxation Not subject to taxation. Financing Contributions from benefits No contributions. LIS variable V26S1 Near-cash food benefits Contents Food Stamp Program (FSP) (national programmes) Legislation Food Stamp Plan, 1939 (first law); Food Stamp Act, 1977 and Welfare Reform, 1996 (current laws). U.S. citizens and some immigrants who are admitted for permanent residency. The average monthly participation level in 2003 was 21.2 million individuals. Approximately 88 percent of food stamp households have gross incomes below the Coverage poverty line ($18,100 for a family of four in 2002). Approximately 38.4 percent of food stamp households have gross incomes at or below half of the poverty line. Households with children receive 79.3 percent of all food stamp benefits Eligibility for the Food Stamp Program is based on financial and non-financial factors. With certain exceptions, a household that meets the eligibility requirements is qualified to receive benefits. Legal immigrants who are children or disabled can now get food stamps, as can legal immigrants who have legally resided in the United States for at least 5 years. Other legal immigrants and any undocumented immigrants are ineligible for food stamp benefits. Also, many able- bodied, childless, unemployed adults have time limits on their receipt of food stamp benefits. -Households, except those with elderly or disabled members, must have gross incomes below 130 percent of the poverty line. All households must have net incomes below 100 percent of poverty to be eligible. Most households may have up to $2,000 in countable resources (e.g., checking/savings account, cash, stocks/bonds). Households with at least one Qualifying conditions household member who is disabled or age 60 or older may have up to $3,000 in resources. Currently, program benefits provide an average of nearly 90 cents a meal per person. - The gross monthly income of most households must be 130 percent or less of the Federal poverty guidelines (US $1,628 per month for a family of three in most places, effective October 1, 2002 through September 30, 2003); gross income includes all cash payments to the household, with a few exceptions specified in the law or the program regulations. - Net monthly income must be 100 percent or less of Federal poverty guidelines (US $1,252 per month for a household of The program provides monthly benefits to eligible low-income families which can be used to purchase food. Through the electronic benefit transfer systems (EBT) the use of food stamp “coupons” is no longer the means in which a client receives their benefits. EBT replaces paper coupons through use of a benefits card, similar to a bank card. Food stamp benefits are based on the "Thrifty Food Plan," USDA's theoretical estimate of what it would cost to purchase a market basket list of particular amounts and kinds of food representing a minimally adequate diet. Benefits An individual household's food stamp allotment is equal to the maximum allotment for that household's size, less 30 percent of the household's net income. Households with no countable income receive the maximum allotment (US $366 per month in Fiscal Year 2003 for a household of three people). Allotment levels are higher for Alaska, Hawaii, Guam, and the Virgin Islands, reflecting higher food prices in those areas. Accumulation with other No restrictions as long as the means-test is satisfied. income Adjustment Financing principle Tax financed. Taxation Benefits are not subject to taxation. Financing Contributions from benefits No contributions. LIS variable V26S4 Near-cash heating benefits Contents Low-Income Home Energy Assistance Program (LIHEAP) (national programmes) Legislation LIHEAP is a federal program that helps low income households pay for heating and/or cooling their homes. In particular, LIHEAP seeks to make home energy more affordable for two groups of low income households that have the highest home energy needs: * Vulnerable households which include frail older individuals, individuals with disabilities, and very young children. These households face serious health risks if they do not have adequate heating or Coverage cooling in their homes. * High energy burden households which include those households with the lowest incomes and highest home energy costs. These households face safety risks in trying to heat or cool their homes if they can not pay their heating or cooling fuel bills. Consequently, households with the highest home energy needs are more likely to face health and safety risks. The Federal law establishes an income range for the Low-Income Home Energy Assistance Program (LIHEAP). States may choose to set their household income cutoff anywhere within the range in determining whether a household is income eligible for LIHEAP benefits. States also may Qualifying conditions establish additional requirements which must be met to qualify for help. Examples include limits on available assets or the presence household members who are elderly, disabled, or 5 years or younger. LIHEAP may offer the following types of help: - heating or cooling funds (i.e., fuel subsidies) to increase the affordability of home energy; - energy crisis intervention to assist weather-related and fuel supply shortages and other household Benefits energy-related emergencies, such as utility shutoffs; and/or - low-cost residential weatherization and other energy-related home repairs to safely increase the efficiency of a household's use of home energy, thus lowering home energy bills and making homes more comfortable. Accumulation with other No restrictions as long as the means-test is satisfied. income Adjustment Financing principle Tax financed. Taxation Benefits are not subject to taxation. Financing Contributions from No contributions. benefits Financed by the State. LIS variable V26S5 Near-cash education benefits Educational assistance, including: Contents - federal student aid (including Pell Grants; loans) (national programmes) - state or local government education assistance (TAP; loans) - other scholarships or grants from schools, employers, friends, etc. Legislation All students in the United States attending eligible institutions of post-secondary Coverage undergraduate, graduate and professional education at least half-time (subject to certain eligibility conditions) Financial need is not required for all types of benefits. Federal Supplemental Educational Opportunity Grant (FSEOG ): The FSEOG program is for undergraduates with exceptional financial need. Pell Grant recipients with the lowest expected family contributions (EFCs) will be considered first for a FSEOG. Pell Grant : unlike a loan this does not have to be repaid. They are awarded usually only to undergraduate students who have not earned a Federal grants bachelor's or a professional degree. The amount you get will depend not only on financial need, but also on your costs to attend school, your status as a full-time or part-time student, and your plans to attend school for a full academic year or less. A variety of grants are offered through most colleges and universities subject to certain privileges and obligations. Perkins loans: These are offered by participating schools to students who demonstrate the greatest financial need (Federal Pell Grant Qualifying conditions ` recipients get the highest priority). Graduate and under-graduate students are eligible and the student does not need to be enrolled at least half-time. PLUS Loans (Parent Loans) : Parents can borrow a PLUS Loan to help Federal loans pay a dependent undergraduate student's education expenses if the student is enrolled at least half time in an eligible program at an eligible school. Loan eligibility is subject to a credit check.PLUS loans are also available for graduate and professional students Stafford Loans (FFELs and Direct Loans) : Offered to graduate and undergraduate students who are enrolled at least half-time. There are as many state level education assistance grant programs as there are states, such as TAP (New York) and TAG (New Jersey), State and Local among others. The qualifying conditions generally match those in the student aid “Pell Grant” above. A good resource for these programs is the http://wdcrobcolp01.ed.gov/Programs/EROD/org_list.cfm?category_ID=S HE. Pell Grant : The maximum Pell Grant in the 2003-04 school year was $4,050. The school can apply Pell Grant funds to school costs, pay students directly (usually by check), or combine these methods. Federal grants FSEOG : The award ranges between $100 and $4,000 a year, depending on the time of application, financial need, the funding at the school of attendance, and the policies of the financial aid office at the school. Perkins loans: These are offered by participating schools to students who demonstrate the greatest financial need (Federal Pell Grant Benefits recipients get the highest priority). Federal loans Plus loans : The yearly limit on a PLUS Loan is equal to your cost of attendance minus any other financial aid you receive. Stafford loans: Depends on grade level in school and dependency status. Financial need is not required. State level assistance varies in its level of generosity by state. State and Local student aid Accumulation with other Some grant and loan programs are subject to a means test and award amounts may be income adjusted based on the receipt of different types of financial aid. Adjustment levels tend to be set by the legislature rather than automatically adjusted based Adjustment on a prevailing price or wage regime. Financing principle Financing Taxation Contributions from benefits General requirements: Eligibility is determined on the basis of financial need and on several other factors. Basically, to receive aid from our programs, a student must: qualify for financial need (except for certain loans); have a high school diploma or a General Education Development (GED) certificate, or pass a test approved by the U.S. Department of Education; be working toward a degree or certificate; be enrolled in an eligible program; be a U.S. citizen or eligible noncitizen; have a valid Social Security Number; register with the Selective Service if required (you can use the paper or electronic FAFSA to register); and maintain satisfactory academic progress once in school. A new law suspends aid eligibility for students who have been convicted under federal or state law of the sale or possession of drugs. LIS variable V27 Value of non-cash food benefits Contents National School Lunch Program (NSLP), (incl. After school snacks and commodity schools) (national programmes) Legislation National School Lunch Act, 1946 (first law) Coverage All students in primary and secondary schools Federally assisted voluntary meal program operating in public and nonprofit private schools and Qualifying conditions residential child care institutions for children from low-income households (household with incomes between 125 and 195% of the official poverty level). All students eating lunches prepared at participating schools pay less than the total cost of the lunches; some students (those not eligible for the NSLP) pay the "full established" price for lunch Benefits (which itself is subsidised), while the NSLP eligible students either pay a "reduced" price for lunch, or receive a "free" lunch. Accumulation with other No restrictions as long as the means-test is satisfied. income Adjustment Financing principle Tax financed. Financing Taxation Benefits are not subject to taxation. Contributions No contributions. LIS variable V28 Value of non-cash housing benefits Public housing Contents Housing subsidies (includes: Section 202, 221 (d) (3) BMIR, Section 236, Section 8, Tenant Based (national programmes) Section 8 and Section 515 (Rural housing service). Federal tax credits are also available. Legislation Housing Act of 1949 Public housing was established to provide decent and safe rental housing for eligible low-income families, the elderly, and persons with disabilities. Public housing comes in all sizes and types, from scattered single family houses to high rise apartments for elderly families. There are approximately 1.2 million households living in public housing units, managed by some 3,300 Housing Authorities Coverage (HAs). Housing subsidies: Over four million eligible low income households are receiving some form of housing subsidy (either housing assistance or federal tax credits). Public housing is limited to low-income families and individuals. An HA determines your eligibility based on: 1) annual gross income; 2) whether you qualify as elderly, a person with a disability, or as a family; and 3) U.S. citizenship or eligible immigration status. HAs use income limits developed by HUD. HUD sets the lower income limits at 80%, and very low income limits at 50%, of the median income Public housing for the county or metropolitan area in which you choose to live. Income limits vary from area to area so eligibility varies among HAs. Families in Qualifying conditions great need are given preferential treatment. Participation is also constrained by the availability of housing. A recipient unit can either be a family of two or more related persons or an individual who is handicapped, elderly, or displaced by urban renewal or natural disaster. Housing assistance is provided to low-income families and individuals Housing subsidies living in public or privately owned dwellings. Rent (also know as the Total Tenant Payment, or (TTP) is based on a family's anticipated gross annual income less deductions. The formula used in determining the TTP is the highest of the following, rounded to the nearest dollar: 1) 30 percent of the monthly adjusted income. Public housing (Monthly Adjusted Income is annual income less deductions allowed by the regulations); 2) 10 percent of monthly income; 3) welfare rent, if Benefits applicable; or 4) a $25 minimum rent or higher amount (up to $50) set by an HA. Rent supplements: the difference between the "fair market" rent and the rent charged to the tenant is paid to the owner by a government agency. Housing subsidies Interest reduction: the amount of interest paid on the mortgage by the owner is reduced so that subsequent savings can be passed along to low income tenants in the form of lower rent charges. Accumulation with other As long as the lower income and wealth limit are respected. income Adjustment Financing principle Tax financed. Taxation Benefits are not subject to taxation. Financing Contributions from No contributions. benefits LIS variable V29 Value of non-cash medical benefits Medicare consists of four parts: Part A. Hospital Insurance (HI) Contents Part B. Supplementary Medical Insurance (SMI) (national programmes) Part C. the Medicare Advantage program, which was established as the Medicare+Choice program by the Balanced Budget Act (BBA) of 1997 (and modified in 2003, it expands beneficiaries’ options for participation in private-sector health care plans.) Part D. a new prescription drug benefit (2003). Medicaid In 1965 the Medicare and Medicaid programs were established in Title XVIII and Title XIX, respectively, of the 1935 Social Security Act. Both are administered since 1977 under the Centers for Medicare & Medicaid Services (until 2001 known as the Social and Rehabilitation Service) Medicare was established to meet the specific medical care needs of the elderly, coverage was added in 1973 for certain disabled persons and certain persons with kidney Legislation disease. (The recent Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 introduced the most sweeping changes to the program since its enactment. Medicaid was established in response to the widely perceived inadequacy of welfare medical care under public assistance. Federal health insurance program (partly universal, partly optional) for people 65 years of age or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure with dialysis or a transplant, sometimes called ESRD). In 2004, almost 42 million people are enrolled in one or both of Parts A and B of the Medicare program, and about 5 million of them have chosen to participate in a Medicare Advantage plan. Medicare The Medicare program covers 95 percent of the elderly population, and many others who are on Social Security because of disability. In 2003, there were Part A benefit payments of $152.1 billion, and Part B benefit payments of $123.8 billion. Total disbursements for Medicare in 2003 were $280.8 billion. Coverage Joint federal-state program that provides medical assistance for certain individuals and families with low incomes and resources. Medicaid is the largest source of funding for medical and health-related services for America’s poorest people. Within broad national guidelines established by Federal statutes, regulations, and policies, each State (1) establishes its own eligibility standards; (2) determines the type, amount, duration, and scope of services; (3) sets the rate of payment for services; and (4) administers its own program. Medicaid policies for eligibility, services, and payment are complex and vary considerably, even among States of similar size or geographic proximity. Thus, a person who is eligible for Medicaid in one State may not be eligible in another State, and the services Medicaid provided by one State may differ considerably in amount, duration, or scope from services provided in a similar or neighboring State. More than 46.0 million persons received health care services through the Medicaid program in FY 2001 (the last year for which beneficiary data are available). In FY 2003, total outlays for the Medicaid program (Federal and State) were $278.3 billion. Children constitute 50 percent of all Medicaid beneficiaries. Must have worked for at least 10 years in Medicare-covered employment, must be 65 years old and a citizen or permanent resident of the United States. Younger person with a disability or with End-Stage Renal disease (permanent kidney failure requiring dialysis or transplant) may also qualify. Part A. is generally provided automatically, and free of premiums, to persons age 65 or over who are eligible for Social Security or Railroad Retirement benefits, whether they have claimed these monthly cash benefits or not. Part B. All citizens (and certain legal aliens) age 65 or over, and all disabled persons entitled to coverage under Part A, are eligible to enroll in Part B on a voluntary basis by payment of a monthly premium. Almost all persons entitled to Part A choose to enroll in Part B. Medicare Part C. (or Medicare Advantage) is an expanded set of options for the delivery of health care under Medicare. While all Medicare beneficiaries can receive their benefits through the original fee-for-service program, most beneficiaries enrolled in both Part A and Part B can choose to participate in a Medicare Advantage plan instead. Organizations that seek to contract as Medicare Advantage plans must meet specific organizational, financial, and other requirements. Part D. (or prescription drug benefit) For individuals entitled to Part A or enrolled in Part B (except those entitled to Medicaid drug coverage). Qualifying conditions Medicaid does not provide medical assistance for all poor persons. Under the broadest provisions of the Federal statute, Medicaid does not provide health care services even for very poor persons unless they are in one of the groups designated below. Low income is only one test for Medicaid eligibility for those within these groups; their resources also are tested against threshold levels(as determined by each State within Federal guidelines). To be eligible for Federal funds, however, States are required to provide Medicaid coverage for certain individuals who receive federally assisted income-maintenance payments, as well as for related groups not receiving cash payments. Medicaid Eligible “categorically needy” groups for whom federal matching funds are provided are those who: 1) meet the requirements for the Aid to Families with Dependent Children (AFDC) program that were in effect in their State on July 16, 1996. 2) Children under age 6 whose family income is at or below 133 percent of the Federal poverty level (FPL).; 3) Pregnant women whose family income is below 133 percent of the FPL (services to these women are limited to those related to pregnancy, complications of pregnancy, delivery, and postpartum care). 4) Supplemental Security Income (SSI) recipients in most States. 5) Recipients of adoption or foster care assistance under Title IV of the Social Security Act. 6) Special protected groups (typically individuals who lose their cash assistance due to earnings from work or from increased Social Security benefits, but who may keep Medicaid for a period of time). 7) All children born after September 30, 1983 who are under age 19, in families with incomes at or below the FPL. 8) Certain Medicare beneficiaries. Part A (HI): pays for inpatient hospital stays, care in a skilled nursing facility, hospice care and some home health care. The benefit period starts when the beneficiary first enters a hospital and ends when there has been a break of at least 60 consecutive days since inpatient hospital or skilled nursing care was provided. There is no limit to the number of benefit periods covered by Part A during a beneficiary’s lifetime; however, inpatient hospital care is normally limited to 90 days during a benefit period, and co-payment requirements apply for days 61-90. If a beneficiary exhausts the 90 days of inpatient hospital care available in a benefit period, he or she can elect to use days of Medicare coverage from a non-renewable “lifetime reserve” of up to 60 (total) additional days of inpatient hospital care. Co-payments are also required for such additional days. Part B (SMI): helps pay for doctors' services, outpatient hospital care, and an array of other medical services that are not covered by Part A. To be covered, all services must be either medically necessary or one of several prescribed preventive benefits. Part B services are generally subject to a deductible and coinsurance. Medicare Part C (MA): There are two primary MA plans: 1) Coordinated care plans, which include health maintenance organizations (HMOs), provider- sponsored organizations (PSOs), preferred provider organizations (PPOs), and other certified coordinated care plans and entities that meet the standards set forth in the law.; and 2) Private, unrestricted fee-for-service plans, which allow beneficiaries to select certain private providers. For those providers who agree to accept the plan’s payment terms and conditions, this option does not place the providers at risk, nor does it vary payment rates based on utilization. Part D (prescription drug benefit): Under a temporary program provides access to prescription drug discount cards, at a cost of no more than $30 annually. For low-income beneficiaries, Part D initially provides transitional financial assistance (of up to $600 per year) for purchasing prescription drugs, plus a subsidized enrollment fee for the discount cards. This temporary plan began in mid-2004 and will phase out in 2006. Beginning in 2006, Part D will provide subsidized access to prescription drug insurance coverage on a voluntary basis, upon payment of a premium, to individuals entitled to Part A or enrolled in Part B, with premium and cost-sharing subsidies for low-income enrollees. Services generally include: Inpatient hospital services • Outpatient hospital services. • Prenatal care. • Vaccines for children. • Physician services. Benefits • Nursing facility services for persons aged 21 or older. • Family planning services and supplies. • Rural health clinic services. • Home health care for persons eligible for skilled-nursing services. • Laboratory and x-ray services. • Pediatric and family nurse practitioner services. • Nurse-midwife services. • Federally qualified health-center (FQHC) services, and ambulatory services of an FQHC that would be available in other settings. Early and periodic screening, diagnostic, and treatment (EPSDT) services for children under age 21. States may also receive Federal matching funds to provide certain optional services. Following are the Medicaid most common of the thirty-four currently approved optional Medicaid services: • Diagnostic services. • Clinic services. • Intermediate care facilities for the mentally retarded (ICFs/MR). • Prescribed drugs and prosthetic devices. • Optometrist services and eyeglasses. • Nursing facility services for children under age 21. • Transportation services. • Rehabilitation and physical therapy services. • Home and community-based care to certain persons with chronic impairments. Medicaid operates as a vendor payment program. States may pay health care providers directly on a fee-for- service basis, or States may pay for Medicaid services through various prepayment arrangements, such as health maintenance organizations (HMOs). Within federally imposed upper limits and specific restrictions, each State for the most part has broad discretion in determining the payment methodology and payment rate for services. Generally, payment rates must be sufficient to enlist enough providers so Accumulation with other that covered services are available at least to the extent that comparable care and services are available to No restrictions as long as the means-test is satisfied. income Adjustment Medicare : Part A: The HI trust fund is financed primarily through a mandatory payroll tax. Almost all employees and self-employed workers in the United States work in employment covered by Part A and pay taxes to support the cost of benefits for aged and disabled beneficiaries. The Part A tax rate is 1.45 percent of earnings, to be paid by each employee and a matching amount by the employer for each employee, and 2.90 percent for self-employed persons. Financing principle Part B: is financed through premium payments ($78.20 per beneficiary per month in 2005) and contributions from the general fund of the U.S. Treasury. Financing Part D: once under way in 2006, will be financed primarily through premium payments and contributions from the general fund of the U. S. Treasury, Medicaid : tax financed. Taxation Benefits are not subject to taxation. Contributions from No contributions. benefits LIS variable V32S1b Voluntary occupational pensions Employer pension plans, includes: Single-employer plans (offered by businesses that employ 100 or more employees) Multiple employer plans and multi-employer plans (offered by businesses the employ fewer Contents than 100 employees). Note: the former involves collective bargaining agreements; the latter (national programmes) does not. These plans may be either defined benefit (DB) or defined contribution (DC). The following data relates to the more generous DB plans only. ERISA 1974 (Employee Retirement Income Security Act). Legislation Internal Revenue Code of 1978 Only 21% of private sector workers are covered by a pension plan (defined benefit only). Only 15% of non-union workers are covered by these private sector pensions (BLS 2005). An estimated 50% of the work force are not offered a private pension plan by their employer. Coverage An estimated 34 million workers participate in a single-employer defined benefit pension plan. Employees generally have to complete a term of service before plan enrollment begins. Enrollment periods vary from firm to firm but may range from six months to a year or longer. Qualifying conditions Employers are required to make sufficient annual contributions to ensure that the plan will contain sufficient assets to pay the promised retirement benefits to employees when they retire. Defined benefit plans provide eligible employees a set monthly benefit upon retirement. The amount is based on factors such as age, earnings and years with the company, rather than on the performance of fund investments. The legal benefit limit is the lesser of 100% of each participant's average compensation, or $170,000. The average pension payout to private sector retirees was US $7,200 (2003). Benefits Defined benefit plans can be structured to provide employees with a range of benefits, such as extra spousal benefits, disability benefits, cost-of-living adjustments, among others. Defined benefit plans are insured by the Pension Benefit Guaranty Corporation (PBGC), a federal agency, Accumulation with other income Adjustment Automatic cost-of-living adjustment. Financing principle Employer and employee contributions (see V2 and V13) Contributions to defined benefit plans are excluded from the gross Taxation income of the participants; plan sponsors are allowed deductions up to a Financing maximum allowable deductible amount. Contributions from No contributions. benefits LIS variable V32SR Private occupational and other pensions n.e.c. Contents Retirement, disability and survivors' pensions from other sources (national programmes) Legislation Coverage Qualifying conditions Benefits Accumulation with other income Adjustment Financing principle Taxation Financing Contributions from benefits LIS variable V33 Public sector occupational pensions Federal government pensions (incl. retirement, disability and survivors) Contents US military pensions (incl. retirement, disability and survivors) (national programmes) State or local government pensions (incl. retirement, disability and survivors) Legislation Coverage Qualifying conditions Benefits Accumulation with other income Adjustment Financing principle Taxation Financing Contributions from benefits The present document draws extensively from the following sources: 1. http://www.taxpolicycenter.org/taxfacts/Content/PDF/ssrate_historical.pdf 2.http://workforcesecurity.doleta.gov/unemploy/uitaxtopic.asp 3.http://www.taxaway.com/taxnumbers2004.htm 4.http://www.1040.com/stddeduct04.cfm. 5. http://www.taxguru.org/incometax/Rates/1040-04.htm 6.www.irs.gov/pub/irs-prior/p929--2004.pdf 7.http://www.txcpa.net/2004_state_tax_rate.htm 8.http://www.ssa.gov/policy/docs/progdesc/ssptw/2002-2003/americas/united_states.html 9. http://www.vba.va.gov/bln/21/Rates/ 10. http://www.acf.hhs.gov/programs/orr/about/divisions.htm 11. http://www.acf.hhs.gov/programs/orr/programs/unaccompanied_refugee_minors.htm 12. http://www.frac.org/html/federal_food_programs/programs/fsp.html 13. http://www.hud.gov/renting/phprog.cfm 14. http://www.aarp.org/research/housing-mobility/affordability/aresearch-import-778-FS85.html 15. http://www.cms.hhs.gov/MedicareProgramRatesStats/downloads/MedicareMedicaidSummaries2004.pdf 16. http://studentaid.ed.gov/PORTALSWebApp/students/english/grants.jsp ADDITIONAL SOURCES (WAVE VI): 1. Social Security Handbook 2001 (http://www.ssa.gov/OP_Home/handbook/ssa-hbk.htm). 2. Internal Revenue Service web site (www.irs.ustreas.gov). 3. US Department of Labor web site (www.dol.gov) 4. State taxation of Social Security and pensions in 2000", by David Baer, AARP Public Policy Institute, November 2001. 5. Food, Nutritions and Consumer Services web site (http://www.fns.usda.gov/fncs). 6. Administration for Children and Families web site (http://www.acf.dhhs.gov/) 7. Department of Veterans Affairs http://www.va.gov 8. IRA, 401k, Keogh plan – What's Best? Optometric Management, Apr 2004 by Kuczborski, Michael D. This file can be accessed online at: http://findarticles.com/p/articles/mi_qa3921/is_200404/ai_n9377566 9. http://www.erisa.com/pUB%20560.htm 10. http://www.pickfordlaw.com/lawyer-attorney-AE9FCF51-6C95-4F90-A4CC0F9D0FFE68F8.html 11.http://www.smartmoney.com/retirement/roth/index.cfm?story=whichira 12. http://www.smartmoney.com/retirement/ira/index.cfm?story=faq 13.http://www.401khelpcenter.com/press_2006/pr_spectrem_022106.html The following sources relate to public sector pensions 14.http://www.dol.gov/ebsa/pdf/sepproposal2.pdf 15.http://www.conversationoncoverage.org/research_conducted/Working_Paper_on_Multiple_Employer _Pension_Plans.pdf 16. http://lehd.dsd.census.gov/led/library/techpapers/tp-2005-01.pdf 17. http://www.law.harvard.edu/programs/lwp/Resource%20Book%20Table%20of%20Contents%20FINAL.p df 18. http://eh.net/encyclopedia/article/craig.pensions.public.us 19. http://www.workinglife.org/wiki/The+Attack+on+Public+Sector+Pensions+Will+Accelerate+(December+5 ,+2005) 20. http://www.military.com/Benefits/0,14972,,00.html 21. http://www.business.ml.com/BCPublic/Retirement/Resources/ArticlesAndTips/Article20050705DefinedB enefitPlans.htm