In addition to Staff Rule 06.02, the following rules and policies will apply in all matters related to dependency allowance.
Country office (CO) staff are paid dependency allowance in accordance with local practices. Dependency allowances are not paid in some countries.
Staff do not receive dependency allowance for:
- Domestic partners
- Other family members, including parents, grandchildren, siblings, in-laws, nieces, and nephews
- Non-family members, even if those individuals are fully reliant upon the staff member for support
- Children of domestic partners who are not natural children of the staff member, unless they are legally adopted and recognized by the World Bank Group as eligible
- A child aged 19-24, who is not a full-time student and has an income of over $10,712
- A child who is married. Once a child is married, s/he cannot be eligible again for dependency allowance even if s/he subsequently divorces.
- A step child who is not resident in the staff member's household or for whom the staff member does not provide at least 50 percent support
A natural child may be an eligible dependent without being a resident in the staff member's household. For example, an unmarried child aged 20 will be eligible even if s/he lives in his/her own apartment and not with the staff member and is not a student. The eligibility applies on the condition that s/he is not working and is dependent on the staff member for primary support.
Calculation of Spouse Income
Non-U.S. dollar income should be converted to U.S. dollars. As spouse income affects dependency allowance payments in increments of $1,000 for spouse incomes over $30,000 gross per year, most exchange rate fluctuations will not affect dependency allowance payments.
For Staff Rule 06.02, spouse income includes:
- worldwide salary, wage, and retirement income. Use W-2, Box 1, and income reported typically on Form 1099-MISC and 1099-R, if applicable. Also, refer to the note below on business income if salary or wages received are part of the spouse's business income, for example, if s/he is self-employed.
- investment income from inheritance or gifts, such as interest and dividends, but not capital gains or losses.
- investment income from other sources, such as interest and dividends, but not capital gains or losses. However, gains and losses on the sale of capital assets should be reported as income if the gains or losses are considered income arising from the regular course of conducting a business like dealing in real estate or securities. See the note below for investment income on jointly-held investments.
- disability income that is taxable income to the recipient.
- unemployment income.
- net rental income, which is income minus expenses. Use Schedule E definitions for U.S. property.
- all Bank Group or IMF pension income, consultant payments—including termination payments, severance payments, and ending employment payments—typically including separation grant, unused annual leave, and resettlement grant.
For Staff Rule 6.02, spouse income excludes:
- gains and losses on sales of capital assets, unless the gains or losses arise from the regular course of conducting a business, such as dealing in real estate or securities.
- the principal of inheritances or gifts.
- tax refunds.
Investment income on jointly-held investments: To compute the spousal share of investment or rental income on jointly-held investments or rental properties, divide the total investment or rental income on jointly-held investments or rental properties by two.
401(k) and similar pre-tax deductions: Spouse 401(k) and retirement deductions are not considered spouse income while the spouse is working and contributing to the plan. However, 401(k) distributions are considered spouse income if the spouse has cashed the plan out or is receiving the benefit in an annuity form. For income generated in the U.S., spouse's earnings as indicated on the spouse's Form W-2 or 1099-R should be reported.
Business income: Income from a business means gross receipts minus business expenses such as:
- Business-related automotive expenses
- Insurance—except health
- Mortgage payments for a business property
- Legal and professional services
- Office expenses
- Pension and profit-sharing costs
- Rent or leases
- Repairs and maintenance
- Taxes and licenses
- Travel expenses
- Wages paid
For U.S. tax payers who pay the higher self-employed social security rates, the difference between the self-employed and non-self-employed rates can also be subtracted from gross receipts to determine gross business income.
The Confirm Dependency Allowance checklist lists the steps required to confirm dependents.
In case of conflict between this guidance and the applicable staff rule, the staff rule prevails.