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Low Income Home Energy Assistance Program Division 10 Service 415 Program 415 Chapters 05 - 65 North Dakota Department of Health and Human Services

1. Business Income – Income earned through the operation of a business other than farming or ranching. Business income is considered EARNED self-employment income. Business income is determined by taking the net business income profit or loss and adding in the depletion or depreciation. Depreciation and depletion are added back in as they are not allowable expenses.

This income is generally included on the Schedule C.

4. Partnerships – A partnership is a self-employment business set up as a partnership with two or more partners. A partner’s share of income, gain, loss, deductions or credits is determined by a partnership agreement. • Ordinary income and guaranteed payments to partners in a partnership are considered EARNED self-employment income. This income is generally included on the Schedule K-1 (Form 1065). The partner’s share of the partnership income is determined by adding the partner’s share of depreciation or depletion to their ordinary income and guaranteed payments. Depreciation and depletion are added back in as they are not allowable expenses. The depreciation and depletion are generally included on the Form 1065. • Rental, interest and dividend income paid to partners in a partnership are considered UNEARNED income as a result of self-employment. The partner’s share of the partnership income is the total of the rental, interest and dividend income. This income is generally included on Schedule K-1 (Form 1065). 5. Other Rental Income – Income received from the cash rental of property. Other rental income is considered UNEARNED income as a result of self-employment. Rental income is determined by taking the total net rental income from all rental properties and adding in the depreciation or depletion. Depreciation and depletion are added back