Property management & leasing
Source-of-Income Discrimination: Definition & Example
What Is Source-of-Income Discrimination?
Source-of-income discrimination is treating a rental applicant differently because of where their lawful income comes from, such as a housing voucher, Social Security, child support, or public assistance.
What does source-of-income discrimination mean?
The federal Fair Housing Act does not list source of income as a protected class, but a growing number of states, counties, and cities do. In those places, "no Section 8" policies and rules that count only wages from an employer can be illegal.
Source-of-income laws usually still allow landlords to confirm that income exists and is enough. What they prohibit is refusing or disfavoring an applicant because of the type of lawful income, such as a voucher, disability benefits, veterans benefits, alimony, or self-employment.
Practical steps include counting every lawful source of income, applying income requirements to the tenant’s share of rent for voucher holders where required, and accepting reasonable alternatives to pay stubs.
Source-of-income discrimination example
An applicant receives $1,900 per month from Social Security Disability and $400 in child support. A landlord in a city with a source-of-income ordinance must count both toward the income requirement, just as it would count wages, and cannot require pay stubs the applicant does not have.
Related terms
- Housing Choice VoucherA Housing Choice Voucher, commonly called Section 8, is a federal rental assistance program in which a local housing agency pays part of an eligible household’s rent directly to a private landlord.
- Fair Housing ActThe Fair Housing Act is a federal law that prohibits discrimination in renting, selling, and financing housing based on race, color, national origin, religion, sex, familial status, or disability.
- Rental CriteriaRental criteria are the written standards a landlord uses to evaluate every applicant, such as minimum income, rental history, credit, and background requirements.
- Proof of IncomeProof of income is documentation showing how much money a person earns, such as pay stubs, tax returns, bank statements, an employer letter, or a benefits statement.
