The massive scale of rapid closings resulted in a flood of questions about regular unemployment insurance, as well the temporary unemployment programs implemented as part of the CARES Act.
We’ve collected your most frequently asked questions and answered them below.
Q. My unemployment claim was denied because I didn’t earn enough. What should I do now?
Most states require you to work a minimum number of hours over a given period of time — typically the past 12 to 18 months — to qualify for regular unemployment benefits. The exact amount you need to earn varies by state. If you didn’t meet that requirement, you’ll likely be told you are “monetarily ineligible” for benefits.
Currently, people who didn’t earn enough to qualify for regular unemployment insurance can still receive benefits through Pandemic Unemployment Assistance (PUA), a temporary program established to aid people out of work due to the coronavirus. In some states, you will automatically be considered for PUA benefits if you’re denied regular unemployment. In other states, you need to fill out a separate application.
Q. I’m currently receiving unemployment. Will working part time affect my benefits?
Working part time doesn’t automatically disqualify you for unemployment benefits, but it will reduce the amount you receive each week. By how much? That depends on how much you earned and the state you live in.
Federal Pandemic Unemployment Compensation, the additional $600 weekly benefit authorized via the CARES Act, works a little differently. If you qualify for at least $1 of unemployment benefits in a given week, you will still receive the full $600 in Federal Pandemic Unemployment Compensation.
Q. I was laid off but received a severance. Can I still collect unemployment benefits?
The rules around severance vary by state. In Illinois, for example, you can collect unemployment even if you receive a severance. That’s because Illinois doesn’t consider your severance pay as income, even if it’s paid out over time rather than in a lump sum. The same is true in California and New Jersey. But in states like Texas, New York, Massachusetts and Arizona, severance pay could temporarily disqualify you from receiving unemployment benefits.
Q. Will the $600 a week of Federal Pandemic Unemployment Compensation affect my Social Security Disability Income?
No. Unemployment insurance benefits, including Pandemic Unemployment Assistance and Federal Pandemic Unemployment Compensation, are considered unearned income and won’t affect Social Security Disability Income. The same is true for Social Security retirement benefits.
Unemployment benefits may affect Supplemental Security Income payments and must be reported.
Q. Can I collect unemployment benefits if I receive Social Security?
Yes. If you receive Social Security retirement benefits but also work, you can collect unemployment benefits if you lose your job, so long as you are eligible under your state’s rules. You may also qualify for temporary coronavirus unemployment programs, such as Pandemic Unemployment Assistance, as well as the $600 a week in Federal Pandemic Unemployment Compensation.
Q. I applied for unemployment but was denied. What should I do now?
In many states, you need to apply for, and be denied, regular unemployment benefits before you will be considered for Pandemic Unemployment Assistance (which covers self-employed, contract and gig workers, among others).
Once you’ve been denied regular unemployment benefits, your state agency will either automatically review your claim for Pandemic Unemployment Assistance or prompt you to submit an additional application for those benefits. In Indiana, for example, you have to proactively apply for PUA after being denied regular unemployment insurance.
Q. How will my benefits be calculated if I don’t have a W-2 or regular weekly income?
Each state has a minimum and maximum possible weekly benefit for Pandemic Unemployment Assistance. This amount varies by state. You can submit the following documents, either when you apply or after, depending on your state, to verify your income:
- 2019 federal tax return, including the following when applicable:
- Schedule C, Profit or Loss from Business.
- Schedule F, Profit or Loss from Farming.
- Schedule K-1, Partner’s Share of Income.
- 2019 1099 form.
- Final pay stub in 2019.
- Invoice, billing or other documentation to provide proof of self-employment.
Some states will automatically issue the minimum benefit to process your claim quickly but will adjust your benefits after you provide proof of your earnings.
Q. Is Pandemic Unemployment Assistance calculated using my net or gross income?
Pandemic Unemployment Assistance benefits for self-employed individuals are calculated using your net income for 2019.
Q. I have a W-2 job and am self-employed/have a contracting gig. Can I claim lost wages of my self-employment, but not my W-2?
The short answer is no. You have to report any W-2 income earned during the base period (typically the past 12 to 18 months) when you file a claim for unemployment insurance. If your W-2 income during that time is enough to qualify for regular unemployment, those earnings alone would be used to calculate your weekly benefit amount.
If your W-2 earnings were less than the minimum required to receive regular unemployment benefits, you may qualify for Pandemic Unemployment Assistance using your income from self-employed, contract or gig work.
Returning to work
Q. Will I lose my unemployment if I don’t go back to work?
Generally speaking, you must be “able and available for work” to qualify for unemployment benefits. That means you risk losing your benefits if your workplace reopens and you choose not to return to work.
The fear of contracting the coronavirus on its own isn’t a valid reason to refuse work, according to the U.S. Department of Labor. But the CARES Act allows for some possible exceptions to this rule, including:
- You are the primary caregiver and your child’s school or day care is closed due to coronavirus.
- You’ve been advised by a health care professional to self-quarantine due to coronavirus concerns.
- You are caring for a member of your household who was diagnosed with COVID-19.
- You don’t have transportation to and from your workplace due to the coronavirus.
Under those circumstances, you may lose regular unemployment benefits but could qualify for Pandemic Unemployment Assistance.
Q. I’m returning to work at reduced hours. Will I still get the $600 a week in federal assistance?
It ultimately depends on your earnings. If you earn too much to qualify for unemployment, you will also stop receiving the $600. But if you still qualify for reduced unemployment benefits, even a small amount, you will also still get the $600 a week.
Q. I am supposed to return to work, but my child’s day care hasn’t reopened. Will I lose unemployment benefits if I don’t return to work?
You can continue to receive unemployment benefits if you are the primary caregiver and are unable to work because your child’s school or day care is closed due to coronavirus.
A note about fraud
The massive influx of unemployment claims in recent months, coupled with outdated systems and a push to process claims as quickly, has created a perfect storm for fraud attacks on state unemployment systems.
Fraud rings are using Social Security numbers, addresses and other information exposed in past cyberattacks to illegally claim unemployment benefits.
If you believe someone has filed for unemployment benefits using your information, contact your state unemployment agency as soon as possible. Some states, including Washington, have a designated place to report suspected fraud.
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Kelsey Sheehy is a writer at NerdWallet. Email: firstname.lastname@example.org.