self employed

[TAX4US]

Can someone explain under the new rule how a self employed can get unemployment benefits. I can't seem to get this one.

[TaxGuyBill]

It hands it off to State Unemployment (then Federal will reimburse the State for amounts paid).

But it will take time for the State Department of Labor to come up with methods and to implement it. So those in that situation need to keep checking their State Unemployment Website for more information.


Here is a Q&A from Minnesota's website (where I live):

Q: I am self-employed (or an independent contractor) and I heard the stimulus package from Congress includes benefits for me. How do I apply for unemployment benefits?

A: We are awaiting guidance from the U.S. Department of Labor on how to implement the law. We will update this website as soon as we have details.

[ATSMAN]

It will be awhile before self-employed individuals see an UI check. My state's UI system will kick you out as soon as you select self employed. I am assuming other states are the same.

There may have to be a completely different system or website created in a hurry or you may have to go to the UI office once it opens (may be after 4/30). Also what happens if your net profits are 0 or negative, do you still get this UI??

UPDATE: Gov. Baker of MA just warned all self-employed individuals to NOT try to file their claim through the existing UI system. It is overloading the system. The state is waiting for Federal directions to figure out how to deal with this new class of claimants that have never been part of the state UI system.

I am assuming this applies to other states too so it may make sense to have a Federal UI system to deal with self-employed claims?

[LCP]

In addition to unemployment, there are a couple other issues related to self-employed and independent contractors....

1. PPP loans... can payments to independent contractors or even draws to owners be factored in as "payroll" in calculating forgiveable loans?

2. SE tax... I see that half (the emlpyee share) can be deferred like employers do payroll taxes. I'm unsure whether that includes the SE shown on a 2019 1040.

Anybody seen anything on either of these issue?

[ATSMAN]

It is my understanding that 1/2 of 2020 SECA is deferred in two installments. One due by end of 2020 and the other 2021.

So 2019 SECA is due by 7/15 along with balance due income tax.

[TAXNJ]

It is my understanding that 1/2 of 2020 SECA is deferred in two installments. One due by end of 2020 and the other 2021.

So 2019 SECA is due by 7/15 along with balance due income tax.

Do you think once the government publishes a Q & A related to these issues it would be better to support what everyone is guessing or giving their understanding and then one can reference the government document(s).