Effective Dates: 05/13/2024 - Present Previous | Next

TN 39 (05-24)

RS 01802.334 Spouse Businesses

A. BACKGROUND

Businesses are often operated jointly by spouses, but all earnings for self-employment purposes may have been reported by only one spouse, frequently spouse one. Partnership determinations in these instances are complicated because that certain outward signs of the spousal relationship are similar to the indications of a partnership. Spouses may have jointly operated a business without considering themselves partners because they did not operate under a written partnership agreement. This does not preclude a finding of partnership for Social Security purposes.

B. OPERATING POLICY

Spouses can form a valid business partnership.

C. OPERATING PROCEDURE

1. Spouse Had No SEI Reported

If a question is raised by an individual as to whether a spouse who had no SEI reported should receive credit for SEI, follow the preceding sections to determine whether a partnership existed.

2. Development Required

If the elements outlined in RS 01802.316 are present, a partnership exists. Question a spousal business arrangement only if one of the conditions set out in RS 01802.310 exists. If development is undertaken, consider:

  1. a. 

    The claim for benefits may be the first time a question is raised as to whether earnings were properly reported or that a partnership existed.

  2. b. 

    One spouse may have already filed for benefits and claimed all of the earnings as theirs.

  3. c. 

    A joint income tax was probably filed and all SEI reported in the name of one spouse.

3. Partnership Existed

If it is determined that a partnership existed, document the file and take the necessary action to correct the earnings records (see RS 01802.344). Do not conclude that a partnership did not exist solely because these factors exist.

4. Reference

SSR 84-11 summarizes various court cases involving the status of spousal business partnerships.

To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0301802334
RS 01802.334 - Spouse Businesses - 05/13/2024
Batch run: 09/24/2024
Rev:05/13/2024