N.M. Admin. Code § 8.150.520.9

Current through Register Vol. 35, No. 24, December 23, 2024

Section 8.150.520.9 - SELF EMPLOYMENT GROSS INCOME

A. Definition: Ongoing self-employment income intended to support the household through the year, that is averaged over a 12 month period, even if the household earns the money in a concentrated period. Self-employment income intended to support the household only for a portion of the year must be averaged over the months it is intended to provide support.

B. Verification sources: Monthly business records detailing profits and expenses or the household's federal income tax return are needed to annualize the household's self-employment income.

C. Gross income calculation: For self-employment income, the net income of the business activity is considered the gross income of the household member. The net income of the business is derived by subtracting the allowable costs of doing business from the business's gross income.

D. Business expenses:

(1) Allowable costs are, generally, those required to produce the business's gross income. These include, but are not limited, to: raw materials, stock, labor, insurance premiums, interest paid on income producing property, taxes paid on income-producing property, transportation for business purposes.

(2) Costs specifically not allowed are payments on the principal of the purchase price of income-producing property, assets, equipment, or machinery, net losses from previous periods, personal income taxes, money set aside for personal expenses, transportation to and from work, charitable contributions, entertainment, and depreciation.

E. Annualizing income: From gross self-employment income, subtract allowable expenses to derive the net self-employment income. Divide the net selfemployment income by 12 to produce a monthly (average) figure. This figure is the countable monthly gross income. To determine the household's total gross, this figure must be added to any other income the household receives.

N.M. Admin. Code § 8.150.520.9

7-1-95, 11-1-95, 11-15-96; 8.150.520.9 NMAC - Rn, 8 NMAC 22.LHP.520.3, 10-1-01; A, 10-1-12, Adopted by New Mexico Register, Volume XXXV, Issue 12, June 25, 2024, eff. 7/1/2024