The 30% Income Rule

You pay approximately 30% of your adjusted monthly income toward rent. The calculation involves: Calculate Annual Gross Income, Subtract Allowed Deductions, Determine Adjusted Income, Calculate 30%.

What Counts as Income

• Wages and salaries (before taxes)
• Social Security benefits
• SSI, pensions, unemployment
• Child support, alimony received
• Self-employment net income

What Doesn't Count

• Food stamps (SNAP)
• One-time payments (tax refunds, inheritances)
• Foster care payments
• Student financial aid for tuition

Allowed Deductions

$480/year per dependent (children under 18, students, disabled family members). $400/year if head, spouse, or sole member is 62+ or disabled. Medical expenses exceeding 3% of income (elderly/disabled only).

Calculation Example

Family of 4 with $2,000/month income ($24,000/year): $24,000 - $1,440 (3 dependents × $480) = $22,560 adjusted. Divided by 12 = $1,880/month. × 30% = $564/month tenant portion.

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