1. (1) Self-employment includes services which are performed for the direct or indirect purpose of obtaining a livelihood or a part of such livelihood. Self-employment is generally established as a sole proprietorship or partnership.
2. (2) An individual is not self-employed when a farm is operated only to supplement the family food supply or as a place on which to raise the family, but is not operated to sell produce.
3. (3) Individuals in self-employment must report time spent engaged in self-employment activities such as time spent about the place of business either working or awaiting calls for goods or services and time spent seeking customers or business for the self-employment venture.

4. (4) Reporting readily determinable self-employment income.

   1. (a) A claimant engaged in self-employment which produces an immediate, readily determined weekly income must report the amounts received for goods and services less business expenses.

   2. (b) A claimant may deduct reasonable business expenses including:

      1. (i) goods bought;
      2. (ii) supplies purchased;
      3. (iii) services; and
      4. (iv) rent.
   3. (c) Payment of loans for buildings or equipment used in the business are not a deductible expense.
   4. (d) A claimant engaged in this type of self-employment must maintain detailed records describing each item of income and expense. The Department may audit those records without prior notice.

5. (5) Estimating self-employment income that is not readily determinable. When an individual is engaged in self-employment and the income cannot be clearly determined for each week, the reportable weekly earnings will be determined on the basis of all available information concerning past income and expenses of the enterprise for the prior three years.

   1. (a) A weekly earnings amount will be computed to represent the potential net income based on the average of past income and expenses of the enterprise.

      1. (i) Furnishing evidence of past income and expenses is the claimant's responsibility.
      2. (ii) Evidence may be obtained from personal or business records, income tax returns, and similar records for the past three years.
   2. (b) The average amount determined must be reported on the weekly claim.
   3. (c) Evidence of changes in the enterprise that would affect the potential income for the present must be reported to the Department and the reportable income will be re-evaluated.
6. (6) Estimated self-employment income from a new business or a business that is expanding. If a claimant has no actual income experience which may be used as evidence of potential income for the current period, the claimant must make a reasonable estimate. This may be based on any available evidence such as a general knowledge of current prices of products bought and marketed, estimated yields, and estimated expense. Any estimated amounts should be so identified.
7. (7) Over estimates of income. If the Department or claimant has overestimated the amount reportable in self-employment, the claimant may make a claim for the amount owed. The claim must be made within 30 days of when the correct earnings were determinable.
8. (8) When an estimated income amount equals or exceeds the weekly benefit amount, the claimant is not unemployed and benefits will not be allowed.
9. (9) Pursuant to Section R994-401-301, a claimant may earn up to 30% of the weekly benefit amount in total self-employment plus any other reportable wages before a reduction is made in the unemployment insurance payment for that week.

KEY: unemployment compensation, unemployed workers

Date of Last Change: October 4, 2022

Notice of Continuation: July 16, 2025

Authorizing, and Implemented or Interpreted Law: 35A-1-104(1); 35A-4-502(1)(b); 35A-4-207