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Title 7: SNAP Page 69 Iowa Department of Health and Human Services Employees’ Manual Chapter I: Specific Households and Participants Self-Employed Households Revised February 13, 2026 Determining Assistance To annualize self-employment income, anticipate with the household the income and expenses of the business for the next 12 months. Normally, the best way to anticipate annual self-employment income is to use the household’s most recently completed federal income tax return. If a tax return is not available, the household should provide records with an accurate summary of its income and expenses. The records obtained from the household must cover the 12-month time period used to annualize income. If the household experiences a significant increase or decrease in business income, the annualized income may not provide a good projection. A substantial change in business may also affect projections. In these cases, work with the household to arrive at the best estimate of future income. A substantial change in the business includes but is not limited to:  A change in the nature or scope of the business, such as changing from selling Avon to selling Stanley or an insurance salesman who decreases or increases the number of types of insurance policies offered; or  A substantial capital gain or loss occurs that was not previously considered; or  A disaster or casualty loss not covered by insurance occurs, such as a flood or a fire. If a self-employment enterprise has been in existence for less than a year, average its income over the period that it has been in operation and project the monthly amount for the coming year. Capital Gains Legal reference: 7 CFR 273.11(a)(3) For self-employment income, add the anticipated monthly amount of capital gains to the anticipated monthly self-employment income, and subtract the cost of producing the self-employment income. Use capital gains only to determine an anticipated amount. Do not allow capital or supplemental losses when determining anticipated capital gains. Calculate a new average amount and use if the anticipated capital gain amount changes. The formula for calculating proceeds from the sale of capital goods or equipment is: the sale price, minus purchase price, plus any amounts depreciated for federal income tax purposes.