Cash or in-kind remuneration for members of religious orders who take a vow of poverty is considered wages in any of the following situations:

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  An individual receives compensation from the order as an active, working member of that order, whether or not the religious order has elected title II coverage.

  EXAMPLE: A member of an order works at a hospital which is owned and operated by the order. The member's compensation of $150 per month from the order is earned income.

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  An active, working member of a religious order receives compensation for performing services from an agency of the church supervising the order or from an affiliated institution, whether or not the religious order has elected title II coverage.

  EXAMPLE: A member of an order teaches at a school which is an affiliate of the order's supervising church. The school pays the member $300 per month which is turned over to the order. This amount is earned income.

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  A member of a religious order receives compensation from a third party for services performed as an employee.

  EXAMPLE: A member of a religious order also works for a private firm which pays $250 per month as a computer programmer. This amount is earned income.

Remuneration for members of religious orders who take a vow of poverty is considered earnings from self-employment only when a member engages in self-employment activity unrelated to their membership in the order.

EXAMPLE: A member of a religious order, who is a recognized ornithological expert, submits articles to a magazine, on a free-lance basis, for publication. Any remuneration received is treated as net earnings from self-employment.

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  Any income provided by the order to a member who has taken a vow of poverty, which does not fall under SI 00810.700B.1. or SI 00810.700B.2., is unearned income to the member even if turned over to the order.

  EXAMPLE: A cash stipend paid to an inactive member, or a payment unrelated to a member's work, that is made by the order to a member is unearned income.

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  Food or shelter that is not considered part of a member's wages is in-kind support and maintenance per SI 00835.710. If the food or shelter is earned income per SI 00810.700B.1., it cannot also be considered in-kind support and maintenance.

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  Any income or resources turned over by the member to the order are considered to be in fulfillment of the vow of poverty and are not considered contributions for food or shelter received from the order.

Unearned income received by a member from any source other than the order (e.g., title II or VA benefits) is income to the member even if the member turns it over to the order.

Scenario: Brother Morris, age 74, is considered a retired, inactive member of a religious order. In October 2002, Brother Morris receives food, shelter, other perquisites, and a cash stipend of $40.00 from the order. In addition, Brother Morris clerks at a private law firm for $500.00 per month and turns these wages over to the order.

Analysis: While working at the private law firm, Brother Morris is considered an employee of the law firm. Therefore, the $500.00 wages received from the law firm is counted as earned income. Because Brother Morris is an inactive member of the order, the $40.00 cash stipend and the food and shelter being received are counted as unearned income. The FO determines that the other perquisites provided by the order (haircuts and use of a vehicle) are not countable income. The food and shelter provided by the order is in-kind support and maintenance. The DO determines that the actual value of the food and shelter is $210.00. Brother Morris is charged with $500.00 in earned income and $241.66 in unearned income (the presumed maximum value of ISM of $201.66 + $40.00 cash stipend).

Accept an individual's allegation that they have taken a vow of poverty unless there is a reason to doubt the allegation.

When a member is performing services for the order, contact the order and document the value of remuneration received in cash or in-kind (valued at full market value), as wages per SI 00820.130 ff. Wages for members whose orders have elected coverage are determined under title II “deemed wage” concept. (See RS 01901.620.)

When a member is performing services for an affiliate of the order, and/or is employed by a third party, develop and document these earnings as wages per SI 00820.130. (Remember to include the value of any in-kind wages provided by the order in determining total wages.)

Apply the appropriate operating instructions pertaining to other types of earned and unearned income.