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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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purpose of avoiding or minimizing such interruption. The business or activity is expected to be continued but no profit is realized due to temporary circumstances beyond the control of the applicant/recipient.

If an applicant experiences a temporary loss of profit:

1. At application, if the applicant has been self-employed longer than 12 months and reports they do not have any self-employment earnings, therefore not gainfully employed, the applicant is not eligible since their gross income ($0) divided by minimum wage results in zero gainfully employed hours. The applicant will have to reapply once gainfully employed. If the applicant has been self-employed for less than 12 months and is not gainfully employed, refer to section V.D. Gainful Employment.

2. If a self-employed applicant/recipient reports a temporary loss of profit during the certification period, the child care worker must assess whether this decrease is a normal seasonal variation in business earnings (e.g., lower income during winter for a lawn care business) or an unexpected situation such as illness-related absence from work. If the decrease is normal, it is considered in the income assessment during the 12-month base period, and no adjustments are made to the case. However, if the decrease is unexpected and abnormal, the child care worker must end date the income, discuss how current living expenses are being paid, and explore other potential income sources for the family. The child care worker must advise the applicant/recipient to notify the child care worker within 10 business days of resuming the business activity.

3. If the applicant/recipient reports a temporary loss of profit from their self- employment at recertification but plans to resume earnings, the temporary loss of profit is factored into the 12-month base period for self-employment. The 12-month base period accounts for the fluctuating nature of self- employment income, including temporary loss of profit. The child care