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Subsidized Child Care Assistance Program Policy Manual Chapter 7. Family Definition and Determining Income Eligibility Revised 08/01/2024

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When the applicant/recipient indicates a net loss from the business, the child care worker must discuss how current living expenses are being met to determine what other income is available to the family. If client's statement is taken, the information must be recorded in the case narrative (or case notes in NC FAST). The child care worker may accept the applicant/recipient’s statement as verification only if: 1. The applicant/recipient cannot obtain the verification from any source, i.e., the source refused to provide verification or cannot be located, and 2. The statement is not questionable. Do not accept the statement if the applicant/recipient refuses or simply fails to provide verification of income.

A. Newly Self-Employed Recipients

In a household with a newly formed business (in operation for less than 12 months), the income must be averaged over the amount of time the business has been in operation. The child care worker must document the month and year that the new business was started. If a recipient becomes self-employed during their eligibility period, the child care worker should consider any income that has been received at the time that the new self-employment is reported. If the recipient reports they have become self-employed, but no earnings have been received due to the business being new, the child care worker must thoroughly document why no self-employment income is being counted. Refer to the Verifications section for information regarding verifying self-employment.

B. Temporary Loss of Profit

"Loss of Profits” means a financial loss caused to the business activity through the interruption of operations or through additional costs incurred for the sole