State Policies

Tennessee State Policies & Resources


Tennessee Department of Human Services

Vocational Rehabilitation (VR) Services

Policy Summary on Self-Employment:

Tennessee Vocational Rehabilitation (VR) Services will support eligible individuals who want to operate and/or expand a for-profit small business for the purpose of manufacturing a product or providing a service for public sale in the competitive market.  Self-employment services provided are intended to result in achieving a competitive employment outcome.

The process begins with an assessment of the individual as well as the proposed business. This assessment may include a business proposal and information regarding the individual’s experiences, skills, abilities, and capabilities required to perform the major tasks and the majority of work needed to operate the proposed business.  It also includes a projection of the proposed business’s  income to compare with the income of similar businesses operated by individuals who have similar training, experience, and  skills, but who do not have a disability, to meet compensation requirements. If initial information gathered indicates that the individual has the aptitudes, abilities and capabilities necessary to operate the proposed business and that the proposed business will more than likely meet the requirements for competitive integrated employment for self-employment, the VR Counselor will meet with the individual to discuss the process and requirements to provide self-employment services.  The individual must submit a completed business plan to VR as soon as possible following the meeting.  The individual is required to seek assistance from a community resource such as, SCORE, Chamber of Commerce, Tennessee Small Business Development Centers , business owner or council, etc. to develop the business plan.

If it is determined that the individual does not have the appropriate skills to operate the proposed business, the deficiencies cannot be overcome, and/or the business will not likely result in a successful self-employment outcome, an assessment is conducted to determine a more appropriate employment objective for the individual. 

If it is determined that the individual does not have the skills but has the ability to acquire the necessary skills and the business would most likely result in a successful employment outcome, an appropriate Individualized Plan for Employment (IPE) would be developed outlining the necessary training and skill development services prior to providing self-employment services.

VR requires specific elements for the business plan including information regarding the viability of the business, specific operations of the business including the individual’s involvement in its’ operation, a marketing plan, bookkeeping practices to be used, an itemized list of proposed goods, services and apparatus needed with the lowest possible cost for each and a proposed cash flow showing the business’s expected income.

Once the business plan has been written and reviewed for its’ completeness, the VR Counselor submits it to the VR Field Supervisor for approval to be reviewed by the business plan review team which consists of the VR Field and Regional Supervisors, the VR Policy Program Coordinator for the grand region and a VR Business Employment Consultant. Other VR or area professionals may be called upon depending on the type and complexity of the business. If the business plan is not approved, the individual may make changes to the business plan based on identified deficiencies and resubmit it one additional time.

Once the business plan is approved the IPE is developed outlining start-up goods, services and supports to be provided; the criteria for progress evaluation; terms and conditions for each service; and responsibilities of the individual as well as any partners.  Services are provided in accordance with VR policy and procedures.

Funds expended by VR are based on the individual needs of the business as outlined in the approved business plan and the IPE and cannot exceed $10,000 without approval of the appropriate authority.  The agency cannot purchase vehicles, land, buildings or building improvements, and cannot underwrite loans, fund illegal activities or hobby ventures.

The case is closed successfully after 90 days of operation and the business has generated an income comparable to the income received by self-employed individuals in similar businesses and who have similar training, experience, and skills, but who do not have disabilities.  The individual must provide documentation of the business’s income every three months.  If, after 90 days the income does not meet the required standard, VR will review the business’s income every three months for up to 18 months.  If, after 18 months the income does not meet the required standard, it will be considered unsuccessful and other services will be considered.

The TN VR policy does not reference supported self-employment. The policy is that the individual must be able to perform the major tasks and the majority of work needed to operate the business. However, assistance in operating the business is acceptable.

TN VR Self Employment Policy October 2021.pdf


The following downloadable PDF contains statewide self-employment resources and links for people with disabilities.

Tennessee Start-up Resources (PDF)

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