7 CFR § 273.10(e)(1)(i)(A) & 7 CFR § 273.11(a)(2)(ii)(A)-(B)

When the expenses are greater than income, the result is a loss. 

  • Deduct non-farm losses from other net self-employment income.  Do not deduct from any other income.
  • Deduct farm losses from other self-employment income.
  • Deduct any remaining farm loss from the total amount of earned income (minus the earned income deduction) and unearned income.

Exception: Do not budget as a farm loss if the annual gross farm income is less than $1000.