1210.025.05.15 UNEARNED INCOME

(CD12-33, OEC12-06 dated March 15, 2012)

Unearned income for all members of the Eligibility Unit (EU) is considered in determining monthly gross income.  See Exclusions from Monthly Gross Income1210.025.10.  Enter all sources of unearned income in FAMIS, whether the income is included or excluded for the child care program.  FAMIS will determine which income sources to include in the child care budget.  It is imperative to enter the correct income sources and amounts in order for FAMIS to correctly determine child care eligibility.  For a list of income sources, see the FAMIS Income Code Chart.

1210.025.05.20 IRREGULAR OR SPORADIC INCOME

(CD12-33, OEC12-06 dated March 15, 2012)

If the household has been receiving irregular or sporadic earned or unearned income over a period of one (1) year or more, divide the income received over the last twelve (12) months by twelve (12) to arrive at a monthly amount.

If the household has been receiving irregular or sporadic earned or unearned income for a period of less than one (1) year, average the amount of income during this period.

If the household's current income shows a substantial increase or decrease, a representative period of the irregular or sporadic income should be used to determine the average monthly amount.  Arrive at a mutually agreed upon prediction of the current income and expenses with the EU. Ensure the EU understands its reporting requirements.  Refer to 1230.045.10 Reporting Changes.

1210.025.05.25 INCOME FROM SELF-EMPLOYMENT

(CD15-05, OEC15-02 dated January 23, 2015), (CD12-33, OEC12-06 dated March 15, 2012)

Use the previous year's tax forms to verify self employment income. If the participant has been self-employed for one (1) year or more, divide the income received over the last 12 months by 12 to determine the household’s average monthly earnings.

If the participant has been self-employed for less than one (1) year, average the amount of self-employed income over the period of time the business has been in operation to determine the household’s average monthly earnings.

If the current monthly amount does not reflect the household's normal monthly income because of a substantial increase or decrease in business, use a representative period of earnings to determine the household's average monthly earnings.

Enter the gross self-employment income on the Select Income (SELINC or FMX0) screen in FAMIS.

Note:  For self employment businesses that are set up as Corporations or S Corporations, income dispersed to the owner(s) is considered wages, not self employment earnings. As such, business expenses cannot be deducted from these wages.

1210.025.05.30 DEDUCTIONS FROM SELF-EMPLOYMENT INCOME

(CD12-33, OEC12-06 dated March 15, 2012)

When possible, use the previous year's tax forms to verify self employment expenses. 

The following overhead expenses are allowed as deductions from gross self employment income.

  1. INCOME FROM BOARDERS – Food Expense - allow the monthly Food Stamp issuance amount for a one person household per each boarder.
  2. INCOME FROM CHILD CARE SELF EMPLOYMENT – Meals – Allow $1.00 per child per meal provided, unless meals are deducted as an expense on the tax schedules, in which case, use the meal deduction from the tax schedule.
  3. INCOME FROM SALES - The cost of operation of a vehicle (current state reimbursement rate), and the cost of supplies (as paid). 
  4. JOB RELATED COSTS - If the individual has costs associated with furnishing his/her own tools, equipment, transportation, etc., allow the expense, as paid, as a deduction. 
  5. FARM INCOME - The cost (as paid) of feed, seed, fertilizers, tools, equipment repair and replacement, labor, cost of operation for farm machinery, shipping costs, custom work, and land rental or ownership costs.
  6. BUSINESS INCOME - The cost (as paid) of tools, equipment repair and replacement, labor, cost of operation of equipment, purchase of materials, supplies, or stock of goods, rental or ownership costs and utilities on separate business establishment, and subcontracting cost.
  7. INCOME PRODUCING PROPERTY - Cost (as paid) of ownership (mortgage or contract payment, taxes, insurance, repairs), utilities, labor, and supplies.

Enter all self employment expenses in the system.  FAMIS will evaluate and deduct only those expenses that are allowable for the child care program.

1210.025.05.35 MILITARY INCOME

(CD12-33, OEC12-06 dated March 15, 2012)

The amount of military income sent to the family unit from a family member stationed away from the residence of the family unit is counted as gross income to the family.

The military family member stationed away from the residence is not included in determining household size.