Can you freelance while on unemployment

Skip to content Home How does freelance work affect unemployment? Ben Davis May 31, How does freelance work affect unemployment? Can you collect unemployment and do freelance work? Does freelance work count as employment? Can you do gig work while collecting unemployment? Is it worth it to work part time while on unemployment? How does gig work affect unemployment benefits? Do gifts count against unemployment? Does Uber report income to unemployment? Does selling a house affect unemployment? Does capital gains count as unemployment income?

Does passive income affect unemployment? Is unemployment a source of income? Can I get Pua without proof of income? Will landlords accept unemployment as income? How much can you earn before declaring? How much can you make on the side without paying taxes? How do I claim income from a side job?

How can I avoid paying taxes on side jobs? If you're an independent worker who has experienced a loss of income due to the pandemic, here's what you need to do to successfully navigate the system and get relief. Independent workers may be eligible for both federal and state relief under several programs. Unlike payroll employees, freelancers and other self-employed workers typically earn income from several sources.

That can make applying for unemployment benefits confusing, since different streams of income may have been affected in different ways by the pandemic. For example, a personal trainer who worked with clients at a gym, an artist who gave up her dog-walking side hustle , and the owner of a nonessential small business may all be eligible for unemployment. But just how much income each lost, and how much they continue to earn, must be taken into consideration.

The key factor for independent workers to consider when applying for relief is whether or not you've experienced a significant loss of income as a direct result of Covid, says certified financial planner Marguerita Cheng, CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland, and a member of the CNBC Advisors Council. In terms of what constitutes significant income, if you were "teaching 20 hours a week at yoga studios, and then you're teaching twice a week on Zoom" and getting paid less per class, you would be considered to have a significant loss of income, says Cheng.

In other words, you don't have to have a total loss of income to be eligible for unemployment benefits. Another complicating factor for some independent workers is that they earn a combination of and W-2 income, and they may not know whether to apply for traditional unemployment benefits or those under the PUA program.

If you lost a job that paid you W-2 income, it makes sense to apply for traditional benefits, explains Stettner. You need to be ineligible to apply for regular W-2 unemployment benefits to be eligible for the PUA program, and it may also be faster to apply for "regular" unemployment through your state.

Before you start your unemployment application, make sure you have the correct paperwork on hand. The biggest difference between freelancers and payroll employees, says Stettner, "is that they will have to provide tax information or another form of information to the state. If you've filed your tax return , the most helpful tax document as it relates to your your unemployment application is Schedule C , says Cheng, which documents your business-related income and losses.

If you are among the vast majority of American people who have very little in the way of savings, you will likely end up spending your benefits on two things in equal measure. On the one hand, you'll be paying as much as you can towards rent and keeping the lights on. On the other, you'll be paying as little as possible toward your credit card bills while still keeping them active so that you can maintain your normal standard of living.

Meanwhile, you'll be straddling the tightrope between keeping it together and everything crashing down around you. Finally, if you are among the far too many poor souls with no savings whatsoever, you don't need me to tell you what your financial outlook is like when your income dries up.

Which one of the above categories you fit into will have a strong influence on what is the optimal use of your time. If you're fortunate enough to fit into this category of people, you have the rare advantage of being at liberty to do whatever you believe is best for your business long term. One solid and reliable strategy from this point would be to get on LinkedIn and connect with prominent figures in your niche that would make for better clients than you had in the past.

In so doing, you can leverage a time of misfortune into potentially the best thing that ever happened to your freelance career. If you're among the many who are just trying to hold it all together, the most efficient use of your time to meet that goal is almost certainly to do whatever you did to attract clients in the past.

What worked before will be the quickest and simplest path to getting back to that same point. If you are sufficiently unfortunate as to fall into this camp, it may be time to consider taking a break from the uncertainty of the freelancer's life and turning to traditional jobs until you have some financial padding.

From getting unemployment benefits to knowing what to do with them, hopefully, that's all your bases covered. Be sure to check back at Keeper Tax for more tips on how to get by in your freelancing journey. Nathan is a copywriter specializing in SaaS Software-as-a-Service writing. When not helping software companies connect with customers or rescuing freelancers from oversized tax bills, he can be found working on his novels.

Keeper Tax automatically finds tax deductions among your purchases. Note: at Keeper Tax, we're on a mission to help freelancers overcome the complexity of their taxes. That sometimes leads us to generalize tax advice. Please reach out via email if you have questions. Get started. Unemployment for Freelancers? In the wake of the coronavirus pandemic, however, things have changed. Unemployment eligibility for self-employment For the first time ever, the federal government imposed upon the U.

Pandemic Unemployment Assistance The CARES act also established PUA, a new type of unemployment compensation with expanded guidelines to assist workers who would have never qualified for regular unemployment benefits.

How to get your PUA benefits If you're looking to collect unemployment insurance benefits as a freelance worker, the first thing you're going to want to do is look up your state's unemployment office. How much will I get? When will the benefits run out? Reason one: endless paperwork The questionnaires and reporting responsibilities don't end once your benefits begin.

Reason two: it's not much money Unemployment isn't like social security, it isn't meant to be something that anyone lives on long term. Can I work while on unemployment? What to do with your benefits Once you're successfully receiving your unemployment benefits through the PUA program, you're going to need to put together a strategy for how to make the most use of both your money and your time.

What to do with your money How you make use of your unemployment money is most likely pre-determined, and it is going to depend on the severity of your circumstances. Best case scenario The ideal situation is of course one where you have plentiful savings tucked away, and can afford to spend your benefits as an investment in your self-employment venture. Most likely scenario If you are among the vast majority of American people who have very little in the way of savings, you will likely end up spending your benefits on two things in equal measure.

Dire straits scenario Finally, if you are among the far too many poor souls with no savings whatsoever, you don't need me to tell you what your financial outlook is like when your income dries up. Rock bottom looks different to everyone, but you'll know it when you get there.

What to do with your time Which one of the above categories you fit into will have a strong influence on what is the optimal use of your time.

Best case scenario If you're fortunate enough to fit into this category of people, you have the rare advantage of being at liberty to do whatever you believe is best for your business long term. Most likely scenario If you're among the many who are just trying to hold it all together, the most efficient use of your time to meet that goal is almost certainly to do whatever you did to attract clients in the past. Dire straits scenario If you are sufficiently unfortunate as to fall into this camp, it may be time to consider taking a break from the uncertainty of the freelancer's life and turning to traditional jobs until you have some financial padding.

Conclusion From getting unemployment benefits to knowing what to do with them, hopefully, that's all your bases covered. Nathan Dresser. Discover the tax write-offs you've been missing Keeper Tax automatically finds tax deductions among your purchases.