Self-Employment Income

 

All FAMIS Programs:

Self-employment income is any income produced by independent sales or services provided by an individual who is responsible for withholding their own taxes or keeping their own records.

 

Examples of Self-employment income include, but are not limited to:

  • Meal delivery services such as Uber, Lyft, GrubHub and Door Dash
  • Independent Consultants for direct sale companies such as Scentsy, Pampered Chef, Mary Kay and Avon
  • Self-made product sales including homemade baked goods, custom designed t-shirts/cups, selling cut firewood
  • Services provided such as mowing, cleaning, hairdressing, or handyman services
  • Farming income
  • Rental income

 

Self-employment income can either be earned (EI) or unearned (UI). See chart below.

Income Type Income Source Explanation
EI – Earned Income SE – Self Employment Includes Contracted Employees who receive a 1099
EI – Earned Income CC – Child Care
EI – Earned Income FA – Farm Income Gross income is more than $1000/year
EI – Earned Income FM – Farm Income Gross income is less than $1000/year
EI – Earned Income RB – Room/Board
EI – Earned Income RE – Rental Income Actively engaged in managing the property for more than 20 hours/week
UI – Unearned Income RN – Rental Income Not actively engaged in managing the property for more than 20 hours/week
*S Corporations should be treated as Earned Income (EI) and Wages (WA) as expenses are not allowed.

Acceptable verification for self-employment include but are not limited to:

  • Previous year’s tax return
  • Business Ledger/Records
  • Steady IQ Income Passport
  • Written statement from client(s), if all other options have been explored and failed

 

Entries on Income screen (FMX0) for Self-Employment Income:

 

  1. From Income/FMX0 type A in the Command line and complete these fields:
    1. Type: Enter the appropriate type (EI or UI)
    2. Source: Enter the appropriate source (see chart above)
    3. Source Name: Company Name
    4. Taxes Withheld: Enter N
    5. Emp Id Number: Enter all 9’s
    6. Est Hrs: Enter estimated monthly work hours (9’s if unknown)
    7. Begin Date: Enter the date (MMDDYYYY) income started
    8. Report Date: Enter the date (MMDDYYYY) of application
  2. Press CTRL

Example Income screen for Self-Employment:

 

 

 

Entries on Income Amount screen (FMX3) Using F6=DETAILS:

  1. This screen is completed exactly as it would be for income coded Wages (WA). Enter the gross income reported.
  2. With A on the Command line, complete these fields:
    1. Budget Month: Enter the budget month (MMYYYY)
    2. Frequency: Enter the appropriate Frequency Code
    3. Calculation Method: Enter the appropriate Calculation Method
    4. Hourly (Y/N): Enter Y/N
    5. Pay/Hour: Enter hourly pay if Hourly field is Y
    6. Enter all reported pay information into repeating lines.
      • For a guide to interviewing and discussion of income, see Income in 03.2 Interviewing/Processing

Example Self-Employment Income Amount screen:

  1. Press CTRL. This will automatically display the comment screen.
  2. Complete the required comment. Clearly explain how the budget was calculated, conversations with the customer and why the amount is correct.
    • Describe the verification
      • If additional verification was requested, explain why
    • Irregular amounts
    • Explain why any zero amounts are entered
    • Explain why income is not included, such as a particular pay period (identify by date and amount)
    • Exactly what the customer says about ongoing income
    • Why the calculation method was chosen
    • Expected changes, details about tips, bonuses, variable schedules, shift differentials, overtime, etc.
  3. Return to the Income screen and press F14=INCEXP. Use the Income Expense screen to discuss and enter any self-employment expenses related to this income source.

05.19.25