Example

Ms. Rodell operates a retail store.  Total proceeds for the month are $3,200.  Allowable expenses for the mortgage interest, property tax, insurance, utilities, and goods purchased at wholesale total $3,800.  The $600 deficit cannot be used to offset any other group income.

• Identifiable expenses of labor, stock, and raw material;
• Payments on the principal of the purchase price of income-producing real estate and capital assets, equipment, machinery, and other durable goods;
• Interest, but not the principal, on loans for equipment, real estate, or income-producing property;
• Insurance premiums on equipment, real estate, and other income-producing property.
• Taxes paid on income-producing property;
• Transportation costs while on the job (such as fuel) but not routine transportation to and from work;
• Costs of goods sold, supplies, and materials;
• Advertising costs;
• Accounting and legal fees;
• Professional licensing fees and union dues if necessary to practice a profession or trade;
• Costs of maintaining a place of business such as rent and utilities.  If a business is operated in the home, only the utilities associated with the business may be allowed and not the utilities incurred by the home; and.
• Any other identifiable expenses of producing self-employment income.

• Depreciation on equipment, real estate, or other capital investments;
• A net loss from a previous period;
• Federal, state, and local income taxes;
• Personal entertainment or other personal business expenses;
• Money set aside for retirement;
• The purchase of capital equipment; or
• Any amount that exceeds the payment a household receives from a boarder for lodgings and meals.

• Deduct the net farm loss from any other self-employment income of the group.
• If a net farming loss remains, deduct it from any other countable income of the group, after the earned income deduction has been applied, and 
• The previous year's tax return is the usual basis to calculate the farming income.  Prorate the loss over the year to determine a monthly amount to apply to the other income sources.

Example 1

Ms. Davis and her two children apply for FS and MA.  Ms. Davis is a self-employed caterer.  Last year, she earned $8,000 over the course of the year, though her earnings were uneven during the year.  She earned more during the Christmas season and in the early summer due to catering several weddings.  Ms. Davis expects her annual income to equal her earnings last year.  The household's self-employment earnings should be averaged over a 12-month period.  Her average monthly earnings are $667 per month.  This figure should be used as the group's monthly income to determine eligibility for FS and MA.  If Ms. Davis recently got a contract to provide catering services each week to a new client and, therefore, the prior year's earnings do not reflect her current circumstances, they cannot be used to determine her eligibility or benefits.  If she anticipates earning $2,400 over the next three months, average her expected earnings over the next three months and use this figure ($800) to determine eligibility and compute benefits.

Example 2

Mr. Roberts is self-employed during June, July, and August selling ice cream as a street vendor, but he intends to work at another job (not as a self-employed person) the remainder of the year.  The self-employment income from the ice cream business should be averaged over the three months in which it is earned.

Example

Ms. Thomas pays the group's utility bills directly to the provider.  This is not considered as income to the group or as part of the group's shelter cost.