COVID-19 hit the world hard and fast. Nobody could’ve guessed that a worldwide pandemic would spread around the globe and cause major long-term shutdowns. To prevent the spread of the disease, businesses worldwide were forced to close their doors until the spreading of the virus slowed down. Bigger corporations also took massive hits to their finances and, in turn, were forced to lay off employees. By April 2020, the unemployment rate in the United States reached 14.8%, the highest in decades.
As of May 2021, the unemployment rate is now only 6.1%, less than half what it was a year ago. With millions of people coming off unemployment benefits for the first time in a while, some people may be unsure what that means for their benefits. This guide details what unemployment benefits are, how you qualify them, and how part-time jobs, temporary jobs, and full-time jobs can impact your benefits.
Before we begin looking at the effects of getting a job on unemployment benefits, let’s start by looking at what exactly these benefits are and how you qualify to receive them.
The textbook definition of unemployment benefits is monetary compensation paid to people who have lost their job through no fault of their own. They are designed to keep you financially stable as you look for a new position. Benefits can differ from state to state, so use this website to determine the unemployment benefits in your state.
Let’s look at how the US Department of Labor determines if someone is eligible for unemployment benefits. Generally, there are two main criteria in determining your eligibility.
First of all, you must be out of work through no fault of your own. For example, if you were laid off due to COVID-19 cuts, you will qualify for unemployment benefits. On the other hand, if you’re fired due to workplace harassment or decide to quit your job, you will not qualify for unemployment benefits.
The second criteria for determining unemployment eligibility differs from state to state. To find if you’re eligible in your state of residence, simply Google [State] unemployment benefits eligibility. You should be looking for an official website from your state government. This will tell you exactly how to qualify for unemployment benefits in your state.
Typically, states will have a minimum requirement for wages earned in the past 15 months from when you file for unemployment. For example, in Maryland, you must have earned at least $1,176 in your highest paying quarter (a 2–3 month period).
If you meet both of these requirements, you are eligible to begin receiving unemployment benefits.
So, you’re on unemployment benefits and want to know how different positions will affect your benefits? This section will detail how different job opportunities will affect your unemployment benefits.
According to a recent Zapier survey, 1 in 3 Americans (34%) have a side hustle. So if you’re getting unemployment benefits but still want to start up a side hustle, will it cancel your benefits? Most of the time, that answer will be no.
Side hustles are a great way to add some supplemental income to your accounts. Some popular side hustles include selling on an Etsy or eBay store, redesigning company social media profiles, or designing websites through freelance portals such as Fiverr or Upwork. Most of the time, aside won’t generate enough money for a full-time position.
If you take up a side hustle while on unemployment, you’ll have to include how much you’re earning on your weekly/biweekly unemployment certifications. All your taxable earnings, including those made from side hustle gigs, are looked at in your unemployment filings. What you make from your side hustle will lower the amount you receive from unemployment that week. For example, if you make $200 a week from your Etsy store and make $600 a week from unemployment benefits, you will still get the difference between your benefits and how much you made that week. So, in this example, you’ll still receive $400 in unemployment benefits. If you make more than what you’re receiving from unemployment, you will be ineligible for unemployment benefits.
Take note that if you don’t report your side hustle income to your unemployment office, you will be charged with fraud. So be sure to report it as soon as you can.
In most states, if you’re receiving benefits and accept a part-time position, your unemployment benefits will not be canceled. Like side hustle, the amount you earn will reduce your weekly benefit payment, but it won’t eliminate it altogether.
Let’s use Maryland as an example again. In Maryland, if you get a part-time job while on unemployment, you will simply subtract what your part-time position pays weekly from what you’re currently getting from unemployment. So, if you start earning $550 a week from your part-time position and getting $600 in unemployment benefits, you will still get $50 in unemployment. However, if you earn more than what you’re getting in unemployment payments, you won’t receive anything extra.
Other states have other ways of handling this, so it’s best to look up what your state does before taking on a part-time position.
When taking on a part-time job during unemployment, you should remember one important thing. Be sure to plan ahead and be 100% certain that you won’t quit the job shortly. If you’re on unemployment, get a part-time job, and then quit that part-time job, you lose all your unemployment benefits.
In most cases, you will be ineligible for unemployment benefits during the period of your temporary work. However, similarly to side hustles and part-time positions, you’ll still be paid the difference if you make less than you do from unemployment. Temporary positions will typically pay more than part-time or side hustles, though, so this may be rare.
After your temporary position comes to an end, you must reapply for unemployment benefits.
If you get a full-time job, you will become ineligible for unemployment benefits. You must report this to your unemployment office at your earliest availability. Failure to do so will lead to charges against you for fraud.
Another thing to note is that if you’re offered a job in your field while currently on unemployment benefits and you reject the job, you’ll be taken off of unemployment benefits. Again, this is something that must be reported to the unemployment office immediately.
Side hustle or freelance work, part-time position: If you make less than what you currently are getting per week from unemployment, your benefits will continue at a lower rate. Check your individual state for specifics.
Temporary position: In most cases, you will stop receiving unemployment benefits during your temporary position. Once the position comes to an end, you must reapply for unemployment benefits.
Full-time position: Once you get a full-time position, you must report it immediately to the unemployment office. All your unemployment benefits will be canceled.
We hope this article helped to answer some of your unemployment questions! If you need any more assistance, feel free to DM us on all major social media platforms.
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