# SSR 61-62: SSR 61-62. INCOME FROM BUSINESS OPERATED BY LEGAL GUARDIAN OF INCOMPETENT > Federal · Rulings · In force URL: https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_62 ## Section - **Citation:** SSR 61-62 - **Heading:** SSR 61-62. INCOME FROM BUSINESS OPERATED BY LEGAL GUARDIAN OF INCOMPETENT - **Jurisdiction:** Federal - **Kind:** Rulings - **Status:** In force - **Text as of:** August 14, 2026 - **Source:** Compiled text - **Location:** Social Security Rulings / OASI / Self-Employment / SSR 61-62 ## Text S, the son and legal guardian of F, filed application for old-age insurance benefits on behalf of F in January 1961, when F attained age 65. Based on his date of birth, F needed 13 quarters of coverage to become entitled to benefits. For many years before 1957, F had owned and operated a farm. In 1957, F was adjudged legally incompetent as the result of a stroke, and S, his son, was appointed his legal guardian. Since 1957 S has managed and directed the operation of F's farm, while the physical labor has been done by another son who lives on the farm with F. F himself has been unable to render services of any kind in the operation of the farm because of his mental condition. Since 1957 S has reported the following amounts of net earnings from self-employment for F: 1957 -- $530; 1958 -- none; 159 -- $670; 1960 -- $720. F also had net earnings from self- employment of $640 in 1955. The question is whether the amounts reported for F for the years 1957, 1959, and 1960, are his net earnings from self- employment under section 211(a). If these amounts are not F's net earnings from self-employment, he would have only four quarters of coverage (for the four calendar quarters of 1955) and would not be entitled to benefits. If these amounts are F's net earnings from self-employment, he would have 16 quarters of coverage (for 1955, 1957, 1959, and 1960) and would be entitled to benefits. Section 211(a) provides, as pertinent here, that "net earnings from self-employment" means the gross income, as computed under Subtitle A of the Internal Revenue Code of 1954, derived by an individual from any trade or business carried on by such individual less the deductions which are attributable to such trade or business. In determining what income is includible in net earnings from self-employment, Regulations No. 4, § 404.1051 provides, in pertinent part, as follows: ns the gross income, as computed under Subtitle A of the Internal Revenue Code of 1954, derived by an individual from any trade or business carried on by such individual less the deductions which are attributable to such trade or business. In determining what income is includible in net earnings from self-employment, Regulations No. 4, § 404.1051 provides, in pertinent part, as follows: In the case of an individual adjudicated incompetent, such adjudication and the appointment of a guardian of his property does not divest such individual of title to property owned by him at the time of the adjudication. The incompetent, therefore, is not in the same position as the beneficiary of an estate or trust. Instead, the incompetent continues to be the taxable entity to whom income is chargeable for both income tax and self- employment tax purposes. Within the meaning of the law and regulations cited above, the incompetent is considered to be carrying on the trade or business, and the income (or loss) from the business operated by his guardian for the benefit of the incompetent is includible in computing the incompetent's net earnings from self-employment. Therefore, in the present case, F realized net earnings from self-employment in each of the years 1957, 1959, and 1960 in amounts sufficient to permit crediting each quarter of those years as a quarter of coverage. Accordingly, it is held that F has 16 quarters of coverage (for the years 1955, 1957, 1959 and 1960) and is entitled to old-age benefits beginning January 1961. ## Nearby sections - [SSR 60-27 SSR 60-27. ADMINISTRATOR OR EXECUTOR -- MARSHALLING AND DISTRIBUTING ASSETS OF SINGLE ESTATE](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_60_27.md) - [SSR 61-7 SSR 61-7. FARM RENTAL INCOME -- MATERIAL PARTICIPATION](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_7.md) - [SSR 61-28 SSR 61-28. SOIL BANK PAYMENTS](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_28.md) - [SSR 61-29 SSR 61-29. JOINT OWNERSHIP OF FARM](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_29.md) - [SSR 61-42 SSR 61-42. RENTAL VALUE OF ROOM OCCUPIED BY OWNER-OPERATOR OF ROOMING HOUSE](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_42.md) - [SSR 61-43 SSR 61-43. ADMINISTRATOR OR EXECUTOR -- OPERATION OF BUSINESS AMONG ASSETS OF ESTATE](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_43.md) - [SSR 61-44 SSR 61-44. PERSONAL SERVICES PERFORMED FOR FAMILY MEMBER OF CLOSE FRIEND](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_44.md) - [SSR 61-45 SSR 61-45. RENTAL OF CONSTRUCTION EQUIPMENT](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_45.md) - [SSR 61-62 SSR 61-62. INCOME FROM BUSINESS OPERATED BY LEGAL GUARDIAN OF INCOMPETENT](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_62.md) - [SSR 62-17 SSR 62-17. NET EARNINGS FROM SELF-EMPLOYMENT -- PARTNERSHIP -- HUSBAND AND WIFE](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_62_17.md) - [SSR 62-31 SSR 62-31. NET EARNINGS FROM SELF-EMPLOYMENT](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_62_31.md) - [SSR 62-32 SSR 62-32. SELF-EMPLOYMENT INCOME -- OPTIONAL METHOD OF REPORTING FARM SELF-EMPLOYMENT](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_62_32.md) - [SSR 62-48 SSR 62-48. NET EARNINGS FROM SELF-EMPLOYMENT -- RENTALS FROM REAL ESTATE](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_62_48.md) - [SSR 62-49 SSR 62-49. NET EARNINGS FROM SELF-EMPLOYMENT -- RENTALS FROM REAL ESTATE -- ROYALTIES FROM USE OF OIL LANDS](https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_62_49.md) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/SSA_SSR_OASI_SSR_61_62. Check the current official text before relying on it. Not legal advice.