There are very specific rules (in Health and Human Services Uniform Administrative Requirements in 45 CFR 75) about program income, including the costs of generating income and how that income may be used.
First, if your award (or approved budget) allows it, the costs of generating program income can be deducted from total program income in determining the net amount (which may be negative as you are getting underway).
The default for program net income is that it must be deducted from total allowable costs to determine the net amount you can be reimbursed for under your federal award.
However, if your HHS awarding agency approves, program net income can be used to expand your services. In other words, you can incur additional costs for similar purposes using the program income.
If you continue to receive income after the period of performance of the federal award, by default, you can use that income at the discretion of your agency unless the federal awarding agency specifically states that income, after the period of performance, must be used to reduce the federal share of cost or to expand your program.
John F Heveron, Jr. Principal, Heveron and Company CPAs