P Rental Property Income
 
(02/01/14 – 03/31/14)
Income received from rental property is countable, and can be either of the following:
 
Self Employment Rental Income
 
(See Allowable Business Expenses for additional policy)
 
NOTE Policy in this section also applies to income received from individuals that rent a room in a home owned and occupied by a participant. (See Boarders when meals are provided)
 
Treat rental property income as self employment when a participant manages the property (e.g. rent collection, maintenance, or other work).
 
NA EXCEPTION
An average of at least 20 hours per week must be spent managing the rental property to be considered self employment. AZTECS applies both of the following to self employment rental income:
20% earned income deduction.
40% self employment expense deduction when at least one self employment expense is verified. (See Example Rental – Self Employment)
 
Determine the identifiable allowable business expense when the owner of the rental property does not have a separate meter and both of the following occur:
 
The owner resides in the home
The owner manages the property
 
A personal shelter expense cannot be claimed for an allowable business expense.
 
(See Self Employment Verification for acceptable verification)