Supplemental Nutrition Assistance Program (SNAP) Self-Employment Income, PFS-21455-522 (Published July 13, 2023)
If a person is self-employed, the CAO must use the profit from self-employment as gross income when determining eligibility and the benefit amount.
7 CFR § 273.9(b)(1)(ii)
Exception: Income from owning rental property can be unearned income if the person is actively managing the property less than an average of 20 hours per week. See Chapter 550, Income sections 550.2 and 550.3.
To compute profit, the CAO must subtract the allowable costs of doing business from the total gross receipts plus any capital gains.
The CAO must verify total gross receipts and allowable deductions.
7 CFR § 273.2(f)(1)(i)
Households with self-employment income are subject to semiannual reporting (SAR).
The following definitions apply to this chapter:
Allowable costs of doing business: Deductions for costs allowed in producing self-employment income (see Section 552.51).
7 CFR § 273.11(b)
Capital assets: Real property, equipment, machinery, and other items expected to last at least twelve months.
Capital gain: Profit from the sale or transfer of capital assets, calculated the same way as a capital gain for federal income tax purposes.
7 CFR § 273.11(a)(3)
NOTE: The CAO must count the full amount of the capital gain as income for SNAP purposes, even if only a percentage of the proceeds are taxed for federal income tax purposes.
Profit: The amount left after subtracting allowable costs of doing business from the total gross receipts plus any capital gain.
Self-employment: Employed by one’s own business, trade, or profession rather than by an employer.
Self-employment income: The profit from self-employment.
Total gross receipts: The gross amount received from self-employment before any deductions are given for the allowable costs of producing the self-employment income.
Total monthly profit: The monthly income arrived at by dividing the profit by the number of months it is intended to cover.
Reissued March 1, 2012, replacing July 13, 2004