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Enhanced Unemployment Benefits Under the CARES Act

April 6th, 2020 at 7:00 am

The greatly enhanced unemployment benefits mean much more money each week, for longer, for many more kinds of workers, and for many others.


Our blog post last week was about the emergency $1,200 Economic Impact Payment that’s “rapidly” coming to most American adults. (Plus $500 for each qualifying dependent child.) For updates on this payment since then, see the IRS’ special “Coronavirus Tax Relief” webpage. That links you to its News Release IR-2020-61, which came out on March 30, 2020. It was modified and updated on April 1, specifically about Social Security recipients.

Today’s blog post is about the new greatly enhanced unemployment benefits provided by the same law. The $2.2 Trillion Coronavirus Aid, Relief, and Economic Security Act (“CARES”) includes about $260 Billion for expanded unemployment benefits. Although that’s only about one-eighth of the whole package, it’s still a huge amount of money. By way of comparison, $260 Billion is almost 40% of last year’s entire defense budget.

These new unemployment benefits include the following distinct components.

Larger Checks—Federal Pandemic Unemployment Compensation

Individuals who already qualify for unemployment benefits under state law will get an additional $600 per week. This extra is called Federal Pandemic Unemployment Compensation. The states will pay this extra $600 per week in addition to the regular amount of unemployment benefit. Section 2104 of CARES.

This is quite a big increase, especially compared to the usual weekly amount. That usual amount varies widely. In Connecticut the maximum benefit is $631, in Florida it’s $275. No matter your state, the additional $600 per week is a very meaningful increased benefit. 

Longer Payment Period—Extended Unemployment Compensation

Individuals usually get up to 26 weeks of unemployment benefits under state law. Some states provide less. For example, Florida gives only 12 weeks of benefits. CARES adds up to 13 more weeks of benefits, for up to 39 weeks of benefits. Section 2102(c)(2) of CARES.

These additional weeks of benefits include BOTH the regular state unemployment benefit amount PLUS the $600 per week referred to above. Section 2102(d)(1)(A) of CARES.

Extension of Exhausted Benefits—Available to Work but Can’t Find Work

The new law also reinstates unemployment benefits for those “have exhausted all rights to regular compensation under the State law or under Federal law” for the benefit year. This assumes that the individual is “able to work, available to work, and actively seeking work.” Section 2107(a)(2) of CARES.

The unemployment benefit amount under this part of the law includes the regular state-determined weekly amount plus $600, as discussed above. Section 2107(a)(4) of CARES.

Pandemic-Related Individuals—Virtually Everyone Who’s Impacted

The law gives unemployment benefits to a wide array of individuals affected by the health emergency, covering 10 categories. An individual who doesn’t otherwise qualify for the unemployment benefits receives them by providing a “self-certification” stating that he or she is “unemployed, partially unemployed, or unable or unavailable to work because” of the following conditions. The individual:

  1. has been diagnosed with COVID-19 or has symptoms and is currently being diagnosed
  2. has a household member who’s been diagnosed with COVID-19
  3. is caring for a family or household member diagnosed with COVID-19
  4. has a child or other dependent who can’t go to school or a care facility because of the health emergency
  5. can’t get to the workplace because of a quarantine
  6. can’t get to the workplace because of being “advised by a health care provider to self-quarantine due to concerns related to COVID–19”
  7. was scheduled to return to work but can’t because of the health emergency
  8. became the “breadwinner or major support for a household “because the head of the household has died as a direct result of COVID–19”
  9. “has to quit his or her job as a direct result of COVID–19”
  10. lost a job because the “place of employment is closed as a direct result of the COVID–19 public health emergency”

Section 2102(a)(3)(A) of CARES.

Consistent with the other parts of the law, the amount of weekly benefit is the regular state-determined amount plus $600. Section 2102(d)(1)(A) of CARES.

Nontraditional Workers Get Benefits—More “Covered Individuals”

Self-employed and independent contractors are usually not covered by state unemployment benefits. Very significantly, many of the benefits we’re discussing here do apply to these nontraditional workers. The law says that

The term “covered individual”—(A) means an individual who

(II) is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for regular unemployment or extended benefits under State or Federal law or pandemic emergency unemployment compensation under section 2107 and meets the requirements of subclause (I)

Section 2102(d)(1)(A) of CARES. The reference to Section 2107 is to those who already qualify for benefits otherwise, as discussed two sections above. The other reference to subclause (l) is to the list of 10 COVID-19-related circumstances listed in the section immediately above. So the self-employed and independent contractors receive unemployment benefits if they fit any of the 10 conditions.

However, these benefits to the self-employed and independent contractors are not available to those who can work remotely—who can “telework with pay.” Also individuals “receiving paid sick leave or other paid leave benefits” don’t qualify. That’s true even if they fit into any of the 10 COVID-19-related categories discussed above.

 

The Truth behind Bankruptcy Filing

July 16th, 2014 at 1:23 pm

bankruptcy filing, credit scores, impending bankruptcy, medical debt, San Antonio bankruptcy attorney, Texas bankruptcy attorney, unemploymentAmericans file for bankruptcy each year as the result of owing more money to creditors than can actually be paid. While often times the term “bankruptcy” is stigmatized and correlated with poor spending habits and large credit card bills, the truth is it is a necessary practice for economic relief in dire times.

Most people who file for bankruptcy are not irresponsible, nor are they trying to use the process as a means of simply walking away from their debt. US News stated in an article, citing a study by The Bureau of Labor Statistics, that as of April 2012 more than 5.2 million people across the country had been unemployed for six months or more. In addition to unemployment as a factor, money lost due to divorce is also a large contributor to outstanding debt, as well as medical expenses.

There are several other common misconceptions about bankruptcy filing and those who file. Consider the following misunderstood and misinterpreted bankruptcy concepts everyone should know:

  • Bankruptcy filing ruins credit scores permanently: Although many believe they will never be able to get another loan or credit card after filing, this is not necessarily the case. You may have to start slowly, but making regular payments on loans will gradually increase your score.
  • Bankruptcy may not forgive all kinds of debt: This is a widely held belief that often is not true. Certain types of debt and payments are not absolved with bankruptcy. These include obligations such as alimony and child support, some kinds of student loans, and any type of criminal fines.
  • Use of credit cards with an impending bankruptcy: Be wary of using your credit cards right before you file, and never deliberately run up your bills under the assumption that it will be forgiven. This practice has been deemed as committing fraud in the past, and you run the risk of getting stuck with the bills after the process anyway.

If you are struggling with debt problems in the San Antonio, Texas area due to job loss, medical issues, or any other reason, seek help from a San Antonio bankruptcy attorney today. Contact the Law Offices of Chance M. McGhee for all of your bankruptcy needs, and to start the process of financial relief and recovery.

Post-Grad Unemployment and the Struggles to Find a Job

June 13th, 2014 at 7:00 am

 bachelor's degree, bankruptcy, college degree, college graduates, employment status, high school graduates, recession, San Antonio bankruptcy attorney, underemployment, unemploymentEven though it seems as if the economy is making a recovery from the 2008 recession, college graduates are still having trouble finding employment. And when you look at the statistics, college graduates are not hit nearly as hard as high school graduates in regards to the job market.

The unemployment rate for bachelors holders is nearly half compared to those seeking work but only maintain a high school diploma. These rates include those individuals aged 25 years or older who completed college, as well as those aged 25 years or older who did not attend college at all. However, despite these improvements, college graduates are still not doing as well as those who graduated during the decade of the 1990s. With that said, unemployment and the struggle to find a job can unfortunately lead to bankruptcy in the future.

The Bureau of Labor Statistics released a report in early 2013 regarding students under 30 years of age who graduated within the previous year, and included their employment status. At the time, 73 percent were employed. However, whether the work was part-time or full-time work was not specified. Eleven percent were still unemployed one year following graduation.

Yet looking back to 1994, 87 percent of graduates with a bachelor’s degree held a job, either part-time or full-time, one year following their graduation. The Department of Education provided this statistic, along with another which noted that 8.4 percent were out of the workforce and another 4.4 percent unemployed. Of those out of the workforce in 1994, the Department of Education said that the majority had returned to school.

What is making the situation worse right now is not unemployment, but underemployment. Many experts are worried that underemployment will affect the college ranks. According to the Wall Street Journal, 284,000 Americans with a bachelor’s degree or higher are working in jobs that pay minimum wage or less. This number is double the amount of those with such degrees working in these jobs prior to the hit of the recession.

If you were hit by the recession and are now faced with bankruptcy as a result of unemployment issues, contact a Texas bankruptcy attorney today.

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