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48 | P a g e October 25 income is not computed the same as it is for Internal Revenue Service (IRS) purposes. The IRS forms may only be used for verification purposes. Expenses must be current, not due from a previous fiscal period and are allowed when they are billed or otherwise become due. Note: Some self-employed individuals do not claim all expenses on their Schedule C to qualify for Earned Income Tax Credit (EITC). The allowable expenses not shown on Schedule C can be verified by the household and used in determining accurate self-employment earnings. Allowable deductions from self-employment income include, but are not limited to: • Payments on the principal of the purchase price of income producing real estate and capital assets, equipment, machinery, and other durable goods even if the capital asset or durable goods are not set up on a depreciation schedule. Capital assets and durable goods are objects used in business expected to last a long time such as farm machinery, equipment, buildings, computers, furniture, vehicles, etc. • Interest paid to purchase income producing property, insurance premiums, and taxes paid on income producing property. • Materials/Inventory Costs • Advertising • Professional Fees (Legal/Accounting/Bank Fees, etc.) • Business License Fees, Dues and Professional Publications • Commissions paid to employees. • Freight • Business Insurance • Car and truck expenses are essential to the transport of goods/services • Employee benefit programs including employee pension/profit sharing plans. • Office Supplies and Postage • Repairs/Maintenance • Utilities/Telephone • Labor paid to non-household members (individuals not included in the filing unit), materials, seeds, supplies, plants and fertilizers, interest payments on business loans and operating loans, business portion of home property or expense, repairs, etc. Note: Supplies include small tools, paper, pencils, scissors, oil, gas, envelopes, shampoo, hairbrushes, crayons/color books, etc. Supplies are generally described as objects usually used up or consumed in service.