Which of the following situations allows for the exclusion of income?

The correct choice highlights a situation where income can be excluded under certain circumstances. Scholarships that are not utilized for living expenses may be excluded from the total income calculation when evaluating financial need or eligibility for certain programs. The rationale behind this is that funds earmarked for educational purposes—if they are not intended to cover living expenses—do not contribute to a person's disposable income. This is especially relevant in the context of multifamily housing assistance programs, which often take into account income assessments to determine eligibility for housing benefits.

In contrast, income from pensions, investments, and Social Security benefits for minors generally counts towards total income. Pension income is usually reliable, predictable, and considered part of an individual's financial resources. Investment income is similarly viewed as an asset that contributes to a person's overall financial standing. Social Security benefits, while sometimes adjusted for children, typically still constitute income that must be reported. In summary, excluding scholarships that are not used for living expenses recognizes the distinct purpose of those funds, differentiating them from income that financially sustains an individual or household.