Section 144-301-400-FS 444-2 - Self-employment, Migrant Farm Workers and Contract Employees1.SELF-EMPLOYMENTA.GENERAL RULE(1) Self-employment income is averaged over a twelve-month period when it represents the household's largest income source anticipated for the 12-month period. This applies even when it is received in a shorter period of time.(2) Seasonal self-employment income which is not the household's largest income source anticipated for the 12-month period is averaged over the season.B.VERIFICATIONAcceptable verification of self-employment income, expenses, and assets includes but is not limited to income tax returns, business records, and amortization schedules.
C.DETERMINING INCOME(1) All gross self-employment income including the full amount of capital gains is added together. This means that a household with more than one self-employment enterprise shall have all self-employment gross income added together.(2) All costs of producing income are added together. This means that a household with more than one self-employment enterprise shall have all self-employment costs added together. (a) Payments on the principal of the purchase price of income producing real estate, capital assets, equipment, machinery, or other durable goods are allowed.(c) For business use of the home expenses, see Paragraph D below.(d) Expenses not allowed are:(i) net losses from previous periods;(ii) federal, state and local income taxes, retirement plans, and work-related personal expenses (transportation to and from work);(3) The total costs of producing the income are subtracted from the total gross income of the self-employment enterprise(s) to arrive at the net earnings. NOTE: The purpose of Sub Paragraphs 1 through 3 above is to arrive at the total self-employment income of the household. This process allows the loss from one self-employment enterprise to be subtracted from the gain of another self-employment enterprise within the household.
(4) The net earnings are divided by number of months over which income is averaged.(5) Self-employment income is added to any other income received by the household. NOTE: Losses from a farm enterprise are deducted from any other countable household income. This special consideration applies only to farms with annual gross sales of $1,000.00 or more.
D.USE OF RESIDENCE FOR SELF-EMPLOYMENTThe proportionate share of shelter costs used for self-employment purposes may be used as self-employment expenses. If the household chooses this approach-
(1) actual or Internal Revenue Service (IRS) allowed utility expenses, not the standard utility allowance, can be used as a business expense;(2) the interest expenses and the principal of loan and mortgage payments can be used;(3) that portion of shelter costs used as self-employment expenses cannot be used as shelter expenses. (See Section 555-5 for the effect of the self-employment expense decision on the household's allowable utility expenses.)E.RENTAL SELF-EMPLOYMENT INCOME(1) If at least one member of the household is actively engaged in the management of the property at least an average of 20 hours per week, this income is treated as earned income.(2) If no member of the household is actively engaged in the management of the property at least an average of 20 hours per week, this income is treated as unearned income.(3)Income from roomersIncome from roomers as defined in Section 999-1 is always treated as earned income regardless of the number of hours the household is actively engaged in the management of the property. If a person rents out a room in their primary residence, the cost of renting out that room may be claimed as a self-employment expense.
(a) If the roomer income is listed on Federal Tax Returns, the method used for determining those expenses on the return is the method that is used for SNAP budgeting.(b) Otherwise, this expense is determined by multiplying the costs of operating and maintaining the residence by either: (i) the number of rooms used exclusively by the roomers divided by the total number of rooms in the residence, or(ii) the square footage of the space used exclusively by the roomers divided by the square footage in the residence. That portion of household expenses counted as a cost of doing business may not be counted again as a shelter expense. (See Paragraph D(3) above.)
Excluded costs shall not exceed the payments received from the roomer.
If meals are also provided, see Section 444-3.
2.MIGRANT FARM WORKERSA. All income received in the month of application prior to the application date is counted. NOTE: Travel advances are included when a written contract stipulates the advance will be subtracted from wages. Other travel advances are treated as reimbursements.
B. Future income is budgeted when receipt is reasonably anticipated in the application month.C. Income for the month of application must be verified.3.CONTRACT EMPLOYEESA.GENERAL RULEContract income is averaged over a twelve month period when it represents the household's largest income source anticipated for the 12-month period, provided it is not paid on an hourly or piecework basis. This applies even when it is received in a shorter period of time such as sometimes occurs with teachers and other school employees.
Contract income is averaged over the period the income was intended to cover when it is not the household's largest income source anticipated for the 12-month period, provided it is not paid on an hourly or piecework basis.
B.DETERMINING ELIGIBILITYThe averaged contractual income is added to other household income. Income exclusions and deductions shall then be applied in the usual way.
10-144 C.M.R. ch. 301, § 400-FS 444-2