Department of Human Services

Food Stamp Online  Policy Manual

Treatment of Income – Budgeting

Revised: 

26.6

COST OF PRODUCING SELF-EMPLOYMENT INCOME

Food Stamp Table of Contents

1240-1-4-.24(3)

(a)   When a member of the household receives income from self-employment, he/she shall be required to keep a record of expenses incurred in the production of this income.

 

(b)   Expenses

 

1.      Allowable costs of producing self-employment income include, but are not limited to:

 

(i)         Identifiable costs of labor (salaries, employer’s share of SS, insurance, etc.);

 

(i)         Stock, raw materials, seed and fertilizer, feed for livestock;

 

(ii)       Rent and cost of building maintenance;

 

(iii)     Business telephone costs;

 

(iv)     Costs of operating a motor vehicle when required in connection with the operation of the business;

 

(v)       Interest paid to purchase income producing property;

 

(vi)     Insurance premiums and taxes paid on income producing property;

 

(vii)   Costs of feed for work stock; or

 

(viii) Costs of meals and equipment for children for whom day care is provided in the applicant/recipient’s home.

 

2.      Unallowable Deductions

 

The following items are not considered as a cost of producing self-employment income:

 

(i)         Payments on the principal of the purchase price of income producing real estate and capital assets, equipment, machinery, and other durable goods;

 

(ii)       Net losses from previous periods;

 

(iii)     Federal, state, and local income taxes, money set aside for retirement purposes, and other work related personal expenses (such as transportation to and from work). These expenses are accounted for the 20% earned income deduction in the Food Stamp Program.;

 

(iv)     Costs of producing home produce intended for family consumption;

 

(v)       Family living expenses; or

 

(vi)     Depreciation.

 

Glossary of Terms

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Food Stamp Table of Contents

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