The CARES Act’s Unemployment Benefits - Adviser Investments

The CARES Act’s Unemployment Benefits

As the COVID-19 crisis continues, unemployment benefits have become a lifeline for more than 30 million Americans. As part of the CARES Act, these benefits were updated and upgraded. If you lost your job as a result of the pandemic or actions taken to combat it, it’s worth your while to understand how unemployment benefits may help you.

Here’s what to know if you or a loved one is filing for unemployment benefits:

  1. Self-Employed Assistance. Previously, only W-2 wage workers could qualify for unemployment benefits. Freelancers, contractors and other self-employed workers were out of luck. Under the CARES Act, self-employed workers now qualify for the same benefits that other workers enjoy. If you think you may fall into this category, be prepared to provide proof that you are not able to perform your job as a result of COVID-19.
  2. No Waiting Period. Previously, you had to wait one week to receive unemployment benefits, a provision intended to incentivize individuals to return to work as soon as possible. The CARES Act changes this by allowing state governments to eliminate this one-week period, with the federal government on the hook to reimburse states that elect to do so.
  3. $600-Per-Week Increase. Unemployment benefits vary state to state. We encourage you to check with your state’s unemployment website to see if it has a calculator to help approximate your weekly check. Before the CARES Act, a typical benefit would be about half of your normal paycheck. The CARES Act bumped this benefit by an additional $600 per week.
  4. 13 Extra Weeks. Unemployment payments used to cease after 26 weeks. As a result of the CARES Act, that time has been extended by thirteen weeks. Now an eligible individual can collect a total of 39 weeks of benefits between January 27 and December 31, 2020.
  5. How to File. This hasn’t changed. If you believe you may be eligible to receive unemployment benefits, you should plan on filing your claim with the state you were earning in. Click here to find out how to file in the state that you live in.

The key takeaway: Make sure you are receiving everything you are entitled to. Due to the massive influx of newly unemployed individuals, there may be some delays when filing your claim online. However, know that the benefits you eventually receive will be retroactive based on when you lost your job.

If you have any questions about filing or how unemployment benefits work, or anything else on your mind, please contact us. We are here for you.

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