Since the coronavirus hit, a record number of Americans have filed for unemployment benefits. The rates have started declining since the first few weeks of the pandemic, but there are still a shocking number of people out of work.
And as long as states stay shut down, it’s likely that more and more people will be filing for unemployment benefits.
With so many people out of work, the government has expanded unemployment benefits under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This means freelance workers are now eligible for benefits, and unemployed workers will see extra money in their checks.
To help you navigate the process of filing for unemployment benefits, I’m going to answer the most common questions about unemployment and tell you how to apply.
What you need to know about unemployment benefits and how to apply
What are unemployment benefits?
Unemployment benefits, also known as unemployment insurance, pay out a weekly stipend that is meant to replace half of your regular wages in the event that you’ve been laid off. You don’t qualify for unemployment if you’ve been fired or quit your job, and self-employed workers typically don’t qualify (more on this shortly).
Unemployment is a state-based program, but states have to follow federal guidelines that are overseen by the U.S. Department of Labor. And most states require that employers pay both state and federal unemployment taxes.
Benefits typically last for 26 weeks, and laid-off workers will need to make weekly check-ins that confirm their unemployment status.
What are the expanded unemployment benefits?
With so many workers laid off because of the coronavirus pandemic, the U.S. government has expanded unemployment benefits under the CARES Act.
The CARES Act expands states’ ability to provide for workers affected by COVID-19, including an extra $600 per week on top of regular unemployment insurance. This lasts through July 31, 2020, and nearly doubles the maximum weekly amount you can receive in some states.
There is now an additional 13 weeks of benefits, and freelancers, part-time workers, and independent contractors are now eligible for unemployment benefits.
Who qualifies for unemployment benefits?
Anyone who has been laid off, whether it’s related to COVID-19 or not, qualifies for unemployment, but the expanded program means more out of work people will be eligible.
In addition to covering freelance workers, you can also receive benefits if:
- Your workplace shut down because of the pandemic
- You had to quit your job because of the coronavirus
- You were supposed to start a job, but it fell through or you can’t get there because of the coronavirus
- You’re unable to work because you are a caregiver to someone whose school or facility closed due to the coronavirus
You do not qualify for benefits if:
- You were fired
- You chose to quit your job
- You’re paid and working from home
- You are on paid leave
Expanded unemployment benefits for self-employed workers
I want to explain this a little more because I know more and more of you are working in the gig economy or running your own businesses. Actually, 35% of American workers are freelancing now.
It’s a little more complicated for self-employed workers to file for and receive unemployment because states don’t have W-2 forms on file for you. You’ll likely have to submit more documentation about pay, including how you’re paid and how much you’re paid each month. You’ll want to have your tax returns and 1099 forms ready, but if you don’t have those, you can use invoices or any record of what your customers or clients paid you.
Each state has its own filing process and requirements, and I’ve heard that some self-employed workers are struggling with the process because state websites aren’t set up to handle self-employed workers' claims. You might be classified as eligible in the beginning, and then reprocessed. Some states are even setting up portals for these non-traditional workers.
You’re going to want to check in on the status of your claim, but wait times are likely to be long. I know this is frustrating, but there are so many people filing for unemployment benefits and the system hasn’t been set up to handle all of the claims and expanded benefits.
When can I apply for the new unemployment benefits?
You can apply now, and you should do so immediately after losing your job.
There was a waiting period to receive benefits before the CARES Act was passed, and some states have waived the waiting period to help you get your unemployment benefits faster.
As I mentioned above, there are a lot of people applying for benefits, which means longer than normal wait times to get their benefits. Most experts suggest that you keep checking in on the status of your claim after submission.
How much money do you get from unemployment?
Unemployment benefits vary state by state, and each state has a minimum and maximum amounts – Massachusetts offers as much as $1,000 per week, while Arizona’s maximum is $240 per week. It’s meant to replace nearly half of what you make, but each state has its own formula for determining what you get.
What’s important to know now is that each state is paying out an additional $600/week through July 31, 2020. These additional unemployment benefits go into effect in April, but some states might not see the additional benefits until May.
If you filed for unemployment before the additional benefits go into effect, you will still get the extra $600 from April through the end of July.
Can furloughed workers get unemployment?
Yes, part of the expanded unemployment benefits means that workers who were furloughed because of the coronavirus will qualify.
A furlough means you’re on a temporary, unpaid leave. Your employer is probably continuing to provide benefits, like health insurance. Typically, a furloughed worker's ability to get unemployment benefits varies by state, but not now.
Learn more at Laid Off or Furloughed: Here’s What to Do
What if my hours were cut?
Yes, partial unemployment benefits are available if your hours have been cut.
Again, benefits vary by state, but most states take your average weekly wage to calculate what you would receive if you were fully unemployed. Then, some percentage is subtracted to come up with our weekly partial benefits.
How to apply for unemployment
Each state has its own agency and process for filing unemployment, so start by finding your state’s unemployment insurance program.
Your state’s office will tell you what documents you need to file, but you will be asked about the following information:
- Social Security number
- Dates worked
- Your employer’s address
You’ll want to file your claim in the state that you worked, but if you worked in a different state or multiple states, the office in the state you live in will have information about filing a claim with other states.
Even with long delays, the sooner you apply, the sooner you’ll receive benefits.
More programs to help
Expanded unemployment benefits are just one of a few government programs to help Americans affected by COVID-19. But there are lots of resources out there right now:
- 2020 Stimulus Checks: Everything You Need to Know
- The Student Loan Payment Suspension and Interest Waiver: What You Need to Know
- Trouble Paying Your Bills? Here’s a List of Government and Non-Government Resources
- Resources for Healthcare Workers: Food, Freebies, Childcare, and More
- Small Business Resources for Surviving COVID-19
The final word on unemployment benefits
I know that losing your job is devastating, but there is help out there if you’re out of work. File for those unemployment benefits as soon as you can. It might be frustrating to wait for those benefits to hit your bank account, but they’re coming.