Unemployment Benefits For The Self-Employed

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For a long time, self-employed workers, freelancers, and independent contractors have been ineligible for unemployment insurance when they lose their income. This is, however, likely to change thanks to the Coronavirus pandemic. Several programs have been put in place to support independent contractors, gig economy workers, and small business owners whose finances have taken a hit due to the pandemic.

Self-Employed Individuals can now access unemployment insurance

Under the Coronavirus Aid, Relief, and Economic Security Act or CARES Act, states can extend unemployment benefits to independent contractors and other groups who initially didn’t qualify for such benefits. The federal and state governments have improved and enhanced the requirements for sick leave and unemployment benefits, with legislation that impacts self-employed and independent contractors.

According to Michele Evermore, senior research and policy analyst for the National Employment Law Project, the enhanced unemployment benefits are based on disaster unemployment assistance. There are several programs under the CARES Act among them:

  • Pandemic Unemployment Assistance (PUA) program
  • Pandemic Unemployment Compensation (PUC)
  • Pandemic Emergency Unemployment Compensation (PEUC)

These programs will benefit self-employed workers in a number of ways:

  • Offer unemployment benefits to self-employed workers who initially didn’t qualify. The amount offered will be based on the worker’s previous income. The income will vary based on benefit guidelines and locations.
  • Provide supplemental benefits. Workers who qualify for these programs will get $600 every week for up to four months.
  • Provide extra weeks of benefits. Unemployed workers who run out of state benefits will have an additional 13 weeks of benefits.

How to apply for unemployment insurance

Unemployed workers may qualify or unemployment benefits depending on how their state is implementing the CARE Act and their circumstances. Each state has different requirements for eligibility. When filing a claim form, the following detailed are required:

  • Applicant’s name and contact details
  • State ID number or driver’s license
  • Social Security or drivers’ license number and Alien Registration number
  • Proof of income. Applicants may prove their income by sending tax returns, W2 tax forms, pay stubs, and 1099 tax forms
  • Bank account number or routing number for direct deposit.

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