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West Virginia Income Maintenance Manual Chapter 4
West Virginia Income Maintenance Manual Page 90 Chapter 4 Income
➢ Offsetting Farming Losses Offsetting losses from farm self-employment activities is accomplished as follows: Step 1: Determine gross monthly farm self-employment income. Step 2: Determine monthly farm business costs, prorated over the same period used to prorate income. Step 3: Subtract the business costs from the gross farm income to determine the negative number that is the net monthly loss. Step 4: Determine gross non-farm, self-employment income. Step 5: Subtract monthly business costs for the non-farm, self-employment enterprise from the result of Step 4. Step 6: Subtract the result of Step 3 (losses due to farm self-employment) from the result of Step 5 Step 7: If the result of Step 6 is $0 or greater, offsetting the farm loss is complete. The result is used as the total self-employment income for the AG. If the result of Step 6 is negative, the difference between the amount of farm loss and the amount of non-farm self-employment income is used as the net farm loss amount. Proceed to Step 8. Step 8: Add together the total gross earned income (excluding the result from Step 5) and total unearned income of the AG. Step 9: Subtract the net farm loss (Step 7) from the total arrived at in Step 8. This is the final gross monthly income for use in the gross income test. If the final gross monthly income is negative, 0 (zero) is used as the income. Farm and Other Self-Employment Income Example: The Jade family has $2,400 per year gross income from farming. In addition, Mrs. Jade is self- employed and earns $600 per year. One child receives $25 per month child support and Mr. Jade has gross earnings of $400 per month. Step 1: Gross monthly farm self-employment income is $200 per month. Step 2: Monthly farm business costs are $300 per month. Step 3: $200 Farm self-employment income NOTE: Losses from farming self-employment are only offset for the AG containing the person directly involved in the agricultural activity and, then, only when the farmer receives or expects to receive annual gross income of $1,000 or more from the farming enterprise.