- TO:
- ALL COUNTY OFFICES
- FROM:
- JANEL R. LUCK, DIRECTOR
- SUBJECT:
- SELF-EMPLOYMENT TAXES
DISCUSSION:
Effective November 3, 2008, FAMIS programming has been updated to reflect the policy regarding self-employment taxes as an income expense for self-employment income.
A new code, ST - Self-employment Taxes (1040 Schedule SE), has been added to FAMIS to capture the entire amount of the self-employment tax on the Income Expense screen in FAMIS for self-employment income. This tax is found on line 58 of Form 1040. FAMIS will count 100% of this tax as an expense for the Food Stamp and Child Care Programs. FAMIS will count 50% of this tax as an expense for the Temporary Assistance and MO HealthNet Programs.
The existing code, TX - Taxes (Business Assets, SS etc. For Labor) continues to be for taxes paid by self-employed individuals that are not considered self-employment taxes, such as sales tax, taxes on business assets, etc. FAMIS will continue to count 100% of this tax as an expense for all programs.
This is not a change in policy for any program, but is a change in FAMIS.
NECESSARY ACTION:
- Review this memorandum with appropriate staff.