405 - Self-Employment Policy & Regulation - Manual Section

Sep 19, 2026

Chapter 405 provides rules and procedures for determining eligibility for the subsidized child care program when a parent/caretaker is self-employed. It defines self-employment using regulatory and IRS standards, explains how CCIS staff identify and distinguish self-employment types, and sets requirements for work hours, income calculation, and documentation timing. It also addresses special handling for self-employed foster parents and references related training guidance, checkpoint questions, and resources.

LanguageEnglish

CategoryGeneral

FormatPDF

Pages31

Reading Time11 min

AccessFree to download

405.1 GENERAL POLICY & REGULATION

405.2 DEFINITIONS & ACRONYMS

405.3 GOALS & OBJECTIVES

405.4 IDENTIFYING SELF-EMPLOYMENT

405.5 VERIFICATION OF SELF-EMPLOYMENT INCOME

405.6 CALCULATING SELF-EMPLOYMENT INCOME

405.7 WORK & CARE HOURS FOR THE SELF-EMPLOYED

405.8 P/C RESPONSIBILITIES

405.9 CCIS RESPONSIBILITIES

405.10 PELICAN CCW

405.11 UPDATED INFORMATION & ADDITIONAL RESOURCES

405.12 TRAINING GUIDE

405.1 GENERAL POLICY & REGULATION 405.2 DEFINITIONS & ACRONYMS 405.3 GOALS & OBJECTIVES 405.4 IDENTIFYING SELF-EMPLOYMENT 405.4.1 Sole Proprietorships 405.4.2 Partnerships 405.4.3 Farmers 405.4.4 S Corporations 405.4.5 Limited Liability Corporations (LLC) 405.5 VERIFICATION OF SELF-EMPLOYMENT INCOME 405.6 CALCULATING SELF-EMPLOYMENT INCOME 405.7 WORK & CARE HOURS FOR THE SELF-EMPLOYED 405.8 P/C RESPONSIBILITIES 405.9 CCIS RESPONSIBILITIES 405.10 PELICAN CCW 405.11 UPDATED INFORMATION & ADDITIONAL RESOURCES 405.11.1 Announcements 405.11.2 Updates 405.11.3 Communiqués 405.11.4 Additional Resources 405.12 TRAINING GUIDE 405.12.1 Goals 405.12.2 Objectives 405.12.3 Section Checkpoint Questions 405.12.3.1 Questions – 405.1 – General Policy & Regulation 405.12.3.2 Questions – 405.4 – Identifying Self-Employment 405.12.3.3 Questions – 405.5 – Verification of Self-Employment Income 405.12.3.4 Questions – 405.6 – Calculating Self-Employment Income 405.12.3.5 Questions – 405.7 – Work & Care Hours for the Self-Employed 405.12.3.6 Questions – 405.8 – P/C Responsibilities 405.12.3.7 Questions – 405.9 – CCIS Responsibilities 405.12.3.8 Questions – 405.10 – PELICAN CCW 405.12.4 Section Checkpoint Answers 405.12.4.1 Answers – 405.1 – General Policy & Regulation 405.12.4.2 Answers – 405.4 – Identifying Self-Employment 405.12.4.3 Answers – 405.5 – Verification of Self-Employment Income 405.12.4.4 Answers – 405.6 – Estimating Self-Employment Income 405.12.4.5 Answers – 405.7 – Work & Care Hours for the Self-Employed 405.12.4.6 Answers – 405.8 – P/C Responsibilities 405.12.4.7 Answers – 405.9 – CCIS Responsibilities 405.12.4.8 Answers – 405.10-PELICAN CCW 405.1 GENERAL POLICY & REGULATION The information in this chapter contains direction and procedure in determining eligibility for the subsidized child care program as it relates to self-employment. A family must meet both financial and non-financial criteria set forth in 55 Pa. Code, Chapter 3041 (relating to subsidized child care eligibility) in order to be eligible for the subsidized child care program. As set forth in § 3041.3 (relating to definitions), self-employment is defined as,“operating one’s own business, trade or profession for profit equal to or greater than the hourly Pennsylvania minimum wage.” The United States Internal Revenue Service (IRS) goes on to state: A parent/caretaker (p/c) is considered self-employed if the p/c: • Operates a trade or business as a sole proprietor; • Is a member of a partnership or limited liability company that files a Form 1065, U.S. Return of Partnership, that operates a trade or business; or • Is otherwise in business for himself. • Has a part-time business in addition to other employment. CCIS staff must be able to identify self-employment as well as differentiate between the separate types of self-employment. A Federal Income Tax Return must show profit from self-employment that when divided by the Pennsylvania minimum wage is equal to or greater than the required number of work hours. Any profit from a p/c’s self-employment is added to the family’s gross income to determine financial eligibility for the subsidized child care program. Each p/c must also meet the work-hour requirement, which means the p/c works at least 20 hours per week, or works a minimum of 10 hours per week and participates in training for a minimum of 10 hours per week, unless the p/c is a teen parent. Need for care is based on the p/c’s work and/or training hours, including travel time. For self-employed foster parents, the foster parent’s self-employment income is not included in the eligibility determination. However, a self-employed foster parent must still meet the definition of self-employment as set forth in § 3041.3 (relating to definitions) . This means in order to be eligible, a self-employed foster parent must show profit from self-employment that when divided by

FAQs

What criteria must a family meet to be eligible for subsidized child care when a parent/caretaker is self-employed?

The family must meet both financial and non-financial criteria defined in 55 Pa. Code, Chapter 3041. The chapter ties financial eligibility to self-employment profit added to gross income and requires work-hour compliance.

How does the manual define self-employment for eligibility purposes?

Self-employment means operating one’s own business, trade, or profession for profit at or above the hourly Pennsylvania minimum wage. The IRS guidance further specifies scenarios such as sole proprietorships and certain partnership/LLC arrangements.

What income and documentation are required from a self-employed parent/caretaker?

The parent/caretaker must show three months of self-employment income to be eligible. The manual also requires profit to be divided by the minimum wage to meet the hour-based threshold used for determining eligibility.

Sep 19, 2026

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