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Child Care Subsidy Policy October 1, 2024 47 5.2.2.3. Disallowed Expenses. The following expenses are not allowable deductions in calculating net income for purposes of this policy. A. Money set aside for pensions and profit-sharing plans. B. Federal, State, and local income taxes. C. Depreciation and Depletion. D. Net losses from previous years . E. Mileage Rate on vehicles and other travel costs. F. Premiums paid for health/medical insurance. G. Payments on the principal of the purchase price of income producing real estate and capital assets, equipment, machinery, and other durable goods. H. Entertainment and meals. I. Personal expenses paid out of business accounts (personal car payments, utility bills, personal primary residence mortgage/rental payments, clothing, vacation expenses, etc.) Small businesses may provide in-kind compensation to owners in the form of payment of personal bills and expenses directly from business accounts. This is treated as countable income, as it is part of the client’s compensation. J. If the family uses its residence in a self-employment enterprise, the utility costs, rent or interest on the mortgage of the residence will not be allowed unless they can be shown as separate from the household’s normal usage. 5.2.3 Countable Income from Farm Self-Employment. Countable income from farm self-employment consists of gross receipts minus operating expenses from the operation of a farm by a person on his own account as an owner, renter or share cropper. Gross receipts include the value of all products sold, government crop loans, money received from rental of all farm equipment and incidental receipts from the sale of other goods. Operating expenses include expenses directly relating to the operation of the farm such as cost of feed, fertilizer, seed and other farming supplies, cash or wages paid to farm hands, rent, and interest on farm mortgages and farm taxes. 5.2.4 Countable Unearned Income 5.2.4.1 Social Security – any regular social security benefits after deductions for medical insurance.