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VIRGINIA DEPARTMENT OF SOCIAL SERVICES SPECIAL INCOME DETERMINATIONS

10/25 VOLUME V, PART XII, PAGE 5

For households whose mortgage payments represent an investment in the household's residence as well as an investment in income producing property, the mortgage payment, interest, and taxes will be deductible only as part of the household's shelter costs and not as a cost of producing income. If the household can document, however, that costs on that portion of the home used in the self- employment enterprise are separate and identifiable, payments on the mortgage principal, taxes, interest, and other identifiable costs may be deducted as a cost of doing business.

6. Costs Not Allowed (7 CFR 273.11(a)(4)(ii))

The following items are not deductible as a cost of doing business:

a. net losses from previous periods.

b. federal, state, and local income taxes.

c. money set aside for retirement purposes.

d. other work-related personal expenses, such as transportation to and from work.

e. depreciation.

NOTE: "b", "c", and "d" are included in the 20% earned income deduction.

7. Allowable Costs of Producing Income for Day Care Providers

When day care is provided in the home of a member of one household to children other than those living in the same SNAP household, an allowance must be made for the cost of meals and snacks that are provided. The allowance is as follows, unless the provider documents actual costs that exceed these amounts:

Breakfast - $1.70 per meal; Lunch or Supper - $3.22 per meal; Snacks - $.96 per meal.

Money paid to day care providers under Section 12 of the School Lunch Act to serve meals to children, other than their own, is countable. Allowable business costs, as described above, are given.

8. Net Loss from Farm or Fishing Operations (7 CFR 273.11(a)(2)(iii))

Self-employed farmers, as defined in Part XII.A.1.b, and self-employed fishermen may have a net loss once allowable costs of doing business are deducted from gross farm income. If the farmer or fisherman receives annual gross proceeds of $1,000 or more from the farming or fishing enterprise, any net loss amount must be prorated over the year in the same manner used to prorate the farm or fishing income. Losses from farm or fishing self- employment enterprises are offset in two phases. The first phase is offsetting against non- farm or fishing self-employment income. The second phase is offsetting against the total of

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