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Child Care Assistance Program Policy Manual Income verification Issued 08/2022 7.9
Tax forms by ownership type
When requesting tax forms from a self-employed person, it is important to know the self-employment ownership type to know what tax forms to request. See Chapter 6.6.5 (Self-employment income).
Sole proprietor • Form 1040 • Schedule C, E or F Partnership • Form 1040 • Form 1065 (tax return for entire partnership) • Schedule K-1 (Form 1065) (each partner’s share of income, expenses, and credits). Each partner uses their K-1 (Form 1065) to complete their 1040.
S Corporation • Form 1040 • Form 1120 (tax return for entire S Corporation) • Schedule K-1 (Form 1120-S) (each shareholder’s share of the income, expenses, and credits). Each shareholder uses their Schedule K-1 (Form 1120-S) to complete their 1040.
Unearned income • All counted unearned income must be verified using documentation from a timeframe that is the best indicator of future income. The recommended standard is the most current 30 days of verification, excluding child support tracked through PRISM. • For child support tracked through PRISM, the last six months of information is the recommended standard. • For child support that is not tracked through PRISM, the recommended standard is the most current 30 days of verification. • If the worker uses something other than these standards to calculate the income components, it is recommended that the worker case note what was used and how it was used to determine the income components.
Unearned income verification examples
Examples of acceptable documentation of unearned income include but are not limited to:
• Court documents providing child support and/or spousal maintenance amounts. • Documentation from the Child Support and Collections office. In cases where there is a previously agreed upon child support arrangement and the absent parent refuses to sign a verification of payment, the applicant may self-declare child support income during the initial application but must agree to cooperate with child support enforcement by completing the required paperwork. The self-declared child support received is included in the annualization of income. • Award letters from the Social Security Administration, the Veterans’ Administration, etc.