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SNAP CERTIFICATION MANUAL – SECTION 5000 5600 Self-Employment Income 5650 Special Payments to Farmers

 NOTE: The Federal gasoline tax credit and the State gasoline tax refundmay be combined on the same line of the tax form. Recaptured Depreciation and Recaptured Investment Credit IRS allows self-employed individuals to deduct depreciation on property as a cost of doing business. When the property is sold before the end of its useful life, the seller must declare a portion of the depreciation as income for IRS purposes. This is commonly referred to as recaptured depreciation. IRS allows a percentage of certain investments to be deducted as an expense. If the asset is disposed of or ceases to be eligible before the end of the recapture period for recovery property or before the end of the estimated life used to figure the credit, a percentage of the credit may have to be recaptured for IRS purposes. This is commonly referred to as recaptured investment credit. Recaptured depreciation and recaptured investment credit are considered to be capital gains. Patronage Dividends These are dividends paid by cooperatives in cash or in shares of stock. These dividends are similar to rebates paid based on the amount of goods bought or services used for the self- employment enterprise. Cash dividends are counted as income. Stock dividends are counted as a resource. Royalties Payments received as royalties are counted as unearned income, not as part of the self- employment income. Rental Property Rent payments are counted as self-employment income. Payments from rental property that is not part of the business will be handled as a separate source of self-employment income. Agricultural Stabilization and Conservation Service (ASCS) Payments Except for loans and payments made as a result of a Presidentially-declared disaster, ASCS payments are counted as earned self-employment income. Payments made as a result of a Presidentially-declared disaster are excluded as income and resources in accordance with the Disaster Relief Act of 1974 as amended. There are numerous and constantly changing programs under the ASCS including several programs that make payments to farmers for crop losses.