Self-Employment

Created on: 
Mar 01 2016

Table of Contents

Related WACs

DEL Clarifying Information (published February 1, 2017)

WAC 170-290-0045

Working under the Table

If the activity meets the definition of employment or work, as described in WAC 170-290-0003, then the activity is considered to be an approvable activity. We do not monitor if the activity has been or will be reported to the IRS nor taxes paid.

WAC 170-290-0050

Resources for Self-Employment

Direct applicants or consumers to the following resources for assistance:

Incorporations

Incorporated businesses are not self-employment enterprises.

  • Compensation received by an individual from a corporation is countable income.
  • Any distribution of income, including compensation benefits such as rent, living expenses, or transportation is countable income for consumers reporting employment and income as or under an incorporated business.

Cost of Doing Business

Self-employed consumers are responsible for the costs involved in providing verification of his or her business license, registration, UBI number or other self-employment documents needed to determine eligibility for benefits.

Standard Deduction vs Itemized Deduction

When a consumer cannot or does not submit verification of their self-employment expenses, use a standard $100 per month deduction when calculating that income.

Additional Information

When are clients considered self-employed?

A client is considered self-employed under the following conditions:

  • They have a Uniform Business Number (UBI);
  • They earn income from their business and are not paid by an employer;
  • They are responsible to pay their own federal and Social Security taxes;
  • Their work schedule is not controlled by an employer;
  • They participate directly in the production of goods or services that generate their income; and
  • They work outside of the home

What types of business owners are not considered self-employed?

People who run their business out of a corporation are not considered self-employed. This is true even if the person is the sole investor in the business. Corporations are separate entities from their investors and employees. The person is considered an employee of a corporation, and may also have income from dividends related to any investment in the corporation, and/or personal expenses paid by the business.

Corporations include S Corporations and can include Limited Liability Companies (LLC) if they are set up as corporate structures. Partnerships are not incorporated, and are considered self-employment enterprises. For more information on various business structures, visit the IRS website.

Are clients eligible for child care when they work in their own home?

No. Only self-employment activities outside of the client’s home are approved. If the client’s self-employment is split between the home and outside of the home, the Department may only cover the activities outside of the home.

Who manages self-employment child care cases?

All self-employment child care cases are managed by specially trained staff.  These employees process applications and provide ongoing case management for self employed clients.  

What verification is required for self-employed clients?

See “Self-Employment Verification.”

How is the amount of care for a self-employed client determined?

See “Units of Care.”