04 Self-Employment Definition
Self-employment is defined as working for oneself rather than an employer.
When determining whether income meets the self-employment definition all factors relating to the income source must be explored with the participant. The factors to consider include, but are not limited to, the following:
●Existence of an employer - employee relationship
NOTE Self-employed participants do not have an employer - employee relationship with the person or business that they work for.
●Obligation to pay for work related expenses
●Responsibility for obtaining jobs or sales
●Responsibility for scheduling work
●Responsibility for risk of income gain or loss
Self-employment may include, but is not limited to the following situations:
●Income received directly from one's own business, a sole proprietorship, as an independent contractor, or as a member of a partnership.
●Income received from odd jobs or from irregular and varied activities.
●Income received from providing services.
●Income received from selling or reselling goods, including personal property and items purchased for the purpose of resale.
●Income received from working for others on a commission or piecework basis.
The participant has an employer - employee relationship when the person or business they work for is responsible for any of the following:
●Directing and controlling the hours or manner in which the participant performs work.
●Paying the participant’s withholding taxes.
●Providing work related training to the participant.
●Covering the participant’s liability insurance or workers' compensation.
●Providing benefits, such as insurance, pension, or paid leave to the participant.
●Reimbursing the participant’s work-related expenses.
Self-employed participants may or may not incur identifiable
self-employment expenses.
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The case file(g) must be documented with the reason the income was determined as self-employment income or earned income. |
(See
Self-Employment Types for additional policy and procedures)
For examples, see the following: