CalFresh treatment of income from gig economy

The California Department of Social Services (CDSS) has issued clarification about how CalFresh handles income from the gig economy.  Gig economy jobs are short-term jobs coordinated by a third party online tools such as Uber, Lyft or DoorDash.  CDSS states that gigs are paid on a per task basis by the third party is working as an independent contractor which means that CalFresh self-employment income rules apply.

In determining self-employment income, counties must only consider income and expenses that have been verified.  CalFresh recipients must provide verification of the gross amount of their self-employment earnings to the county.  When verifying income, CalFresh recipients must be careful that direct deposit pay stubs may not reflect income prior to deductions taken by the third party.

Both the gross and net income are used when determining CalFresh eligibility and amount of benefits.  In determining gross income, recipients are entitled to an income deduction for self-employment of wither the actual costs of producing self-employment income or 40% of the gross amount earned.  In the gig economy, these costs can include commissions, application fees, gas, car washes, tolls, uniforms and cell phone costs.  Deductible costs do not include net losses from previous periods, taxes, money set aside for retirement, other work related personal expenses such as transportation to and from work, and depreciation.

Recipients may choose only one deduction type, and that method can only be changed recertification or every six months, whichever is earlier.

All other procedures for determining gross and net income apply to income from the gig economy.  (ACIN I-31-19, May 9, 2019.)