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West Virginia Income Maintenance Manual Chapter 4

West Virginia Income Maintenance Manual Page 225 Chapter 4 Income

person is actually engaged in this enterprise, with other sources of income being available during the remainder of the year. Persons who are seasonally self-employed include vendors of seasonal commodities (produce, Christmas trees, etc.), or other seasonal farmers. Cash crop and some seasonal farmers and other persons with similar irregular self-employment income receive their annual income from self-employment in a short period of time and budget their money to meet their living expenses for the next 12 months. Because the income is seasonal, it must be averaged over the period of time it is intended to cover, even if it is the major source of income for the year. However, if the averaged amount of past income does not accurately reflect the anticipated monthly circumstances because of a substantial increase or decrease in business, the income is calculated based on anticipated earnings. Business expenses may be computed on a monthly basis or prorated over a 12-month period, at the client's option. ➢ New Business AGs with a new business that has been in existence less than a year will have their income and incurred business expenses averaged over the amount of time the business has been in operation. From this, the monthly amount is projected for the coming year. However, if the averaged amount of past income and/or expenses does not accurately reflect the anticipated monthly circumstances because of a substantial increase or decrease in business, the income and/or expenses is calculated based on anticipated earnings. 4.16.4.A.2 Determining Gross Profit Gross profit from self-employment is the income remaining after deducting any identifiable costs of doing business from the gross income. ➢ Deductions Examples of allowable deductions include, but are not limited to: • Advertising costs. • Cost of rental space used for conducting the business. • Employee labor costs.