Source of Income - A Protected Class? - The Fair Housing Institute, Inc.

Source of Income – A Protected Class?

When it comes to Source of Income, determining if it’s a protected category can prove to be challenging. Thorough working knowledge of your local laws is imperative. Terry Kitay, a fair housing and civil rights attorney at Baker Donelson joins us to share insights on what properties need to be aware of.

A man pointing at a question that asks if income is a protected category.

Estimated reading time: 3 minutes

What Is Source of Income?

Source of Income is an additional protected class in housing discrimination, but it is not part of the Fair Housing Act. This is because currently, discrimination based on your source of income isn’t a federal issue. Still, it is a commonly added protected class under state and local fair housing laws and ordinances.

When source of income is considered protected, a housing provider cannot refuse to rent to someone based on the source of their lawful income. Typically we see this regarding rental assistance programs or housing subsidies like Section 8.

Who Should Be Concerned With This as a Protected Category?

Regardless of where you are located, if you operate a federally assisted housing program, i.e. 202, 811, or if you have a tax credit property, you typically cannot refuse to accept housing subsidies as a source of income.

Suppose your property doesn’t fall under that umbrella. In that case, you need to dig deeper into your city or county laws and ordinances to determine if source of income is a protected category.

Source of Income is Protected – How Do I Screen Income?

Most housing providers have an income level required to be successful applicants. This can look different if your state protects your source of income or your property is federally assisted. What you are looking to qualify somebody for is the tenant-paid portion of the rent. The first thing you need to determine is how much rental assistance the applicant is receiving. Secondly, what is the difference between the amount of assistance and the market rent you are charging? Once you have those figures, you can apply them to your property’s income standards to see if they meet them.

Source of Income – A Growing Protected Category

In the last few years, there has been a big push for more states to adopt this law. Also, we have seen different bills for it to be included on a federal level. Two main reasons why so many states, cities, and counties are adding source of income as a protected category is the ongoing struggle with housing affordability and availability. By adopting measures like this, more people have an opportunity to better their living situations.

This article has shown the importance of knowing your state and local laws. It’s not enough to just be familiar with the federal housing laws. In addition, you need to be aware of how your property is funded. All of these details are critical when it comes to reviewing income on a tenant’s application.


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