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is from a private insurance company and pays the household in installments, it is countable unearned income. 5. Patronage dividends paid to a self-employment enterprise. Patronage dividends, paid by cooperatives in cash, are countable unearned self-employment income (SNAP 501-1). If the patronage dividends are paid in stock, they are counted as a resource (SNAP 402-1). AGRICULTURAL STABILIZATION & CONSERVATION SERVICES (ASCS): Cash payments are counted as earned self-employment income. These include but are not limited to: Commodity Credit Corporation, acreage reduction and conservation payments, and other one-time or installment payments made to farmers for crop or other losses unrelated to a presidentially declared disaster. If the payment is due to a presidentially declared disaster, it is excluded as both income and a resource due to the Disaster Relief Act. CANCELED DEBT: If canceled debt appears on any of the tax forms, it should not be counted. Before disregarding canceled debt claimed by a household, the household is required to provide a statement from the lending institution verifying the canceled debt. CAPITAL GAINS or CAPITAL LOSSES: Capital gains are increases in the value of property between the time purchased and the time sold. Capital losses are decreases in the value of property between the time purchased and the time sold. Depreciation is considered when determining whether capital gains/losses occur for self-employment businesses. Capital gains/losses are usually determined at the time property is sold. Capital gains from the sale of self-employment property must be annualized as part of the net earnings from self-employment whether paid in a lump sum or in installments. Capital gains are included in prospectively budgeting self-employment income if capital gains are received or are expecting to be received prospectively for next year. Capital losses are not used in any self-employment income determination. They are not considered business expenses or deductions. ALLOWABLE EXPENSES OF PRODUCING SELF-EMPLOYMENT INCOME: Allowable expenses of producing self-employment income are deducted from the gross self- employment income. Most costs of doing business are allowable expenses and may be accepted as listed on the income tax forms or other documentation with few exceptions. Self- employment income for SNAP purposes 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 in order to qualify for Earned Income Tax Credit. The allowable expenses not shown on the Schedule C can be verified by the household and used in determining accurate