Coronavirus unemployment deposit if you are self-employed

A new coronavirus relief package signed into law on Thursday extends unemployment benefits for the self-employed.

American Rescue Plan breathes new life into temporary federal unemployment programs established under the CARES Act in March 2020, including the Pandemic Unemployment Assistance Program, which provides benefits to on-demand workers, freelancers and self-employed workers who have lost their income due to the coronavirus .

It also maintains the federal pandemic unemployment compensation program, which supplements state benefits with an additional $ 300 per week.

Here is what you need to know about the deposit.

Who qualifies

Individuals who are self-employed (including independent contractors and on-demand workers) and who are not eligible for regular unemployment insurance may receive benefits if they are unable to work or work reduced hours by because of the coronavirus.

  • Unemployment assistance in the event of a pandemic: The March 2021 relief program extended this program from 50 weeks of benefits to 79 weeks. The exact amount you receive is decided by your state, which has some discretion in determining eligibility and calculating benefit payments. People who do not have a salary or sufficient work history to qualify for regular unemployment benefits can also claim the PUA.

  • Federal unemployment benefit in the event of a pandemic: The funding bill passed in December 2020 revived this program, providing $ 300 per week in addition to federal and state unemployment benefits. You must apply for unemployment from your state to get the $ 300 per week, which is now payable until September 6, 2021 at the latest.

The coronavirus relief package adopted in December 2020 also established a new program for self-employed workers who also earn income through traditional W-2 employment.

  • Unemployment benefit for mixed employees: Provides an additional $ 100 per week, on top of regular unemployment benefits and $ 300 per week in pandemic unemployment compensation. MEUC payments have been extended until September 6. To be eligible, you must be able to prove that you earned at least $ 5,000 in self-employment income in the previous tax year. States can choose not to provide this benefit.

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The CARES law also established unemployment compensation in the event of an emergency pandemic. This program originally provided up to 13 weeks of benefits for people who maxed out their regular unemployment benefit. The December 2020 package extended PEUC up to 24 weeks. The new relief bill extends the program again, for a total of up to 53 weeks.

How to file a complaint

In most states, you must apply for, and be denied, regular unemployment benefits before being considered for pandemic unemployment assistance.

Once you have been denied regular unemployment benefits, your state agency will automatically review your application for Pandemic Unemployment Assistance or invite you to submit an additional application for these benefits.

A handful of states do not require self-employed workers to go through the regular unemployment claim process first. Instead, they developed a separate application process for on-demand workers, independent contractors, and self-employed workers. Check the website of your national unemployment agency for specific advice on when and how to apply.

What do you need

When you file your claim, you will be required to provide personal information (name, address, social security number) and work history for the past 18-24 months.

Your work history should include all traditional employment (W-2), on-demand work, and self-employment. If you were self-employed all the time, you would usually register as an employer and include your home or business address.

You will also need to verify your income. It’s a bit more complicated for people who don’t get W-2. Here’s what your state may allow as proof of self-employment or work-from-home income.

  • 2019 Federal Income Tax Return, including the following, if applicable:

    • Schedule C, Business Profit or Loss.

    • Annex F, Profits or Losses from Agriculture.

    • Annex K-1, Partner’s Income Share.

  • Invoice, billing or other documentation to provide proof of self-employment.

Workers who are not in the self-employed category will still certify their income via pay stubs and a W-2.

After applying

The next steps depend on the condition. Keep an eye on your email or unemployment portal for updates or requests for additional information.

In most cases, you need to file a weekly claim certifying that you are still out of work. You won’t receive benefits for the week if you don’t file your claim, so don’t skip this step, even if your claim is still being processed.

As of January 31, 2021, you must provide proof of previous employment, including self-employment, in order to receive federal unemployment benefits. New applicants have 21 days to provide proof. Those who started receiving benefits before this date must provide proof of previous employment within 90 days of January 31 to continue receiving benefits.

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