March 28, 2024

What You Need to Know About Unemployment Insurance

Unemployment benefits provide temporary cash benefits to workers who lost their jobs through no fault of their own, while they search for a new one. Each state administers its own program but follows federal guidelines. Benefits are generally a percentage of your income over the past year, up to a certain maximum, but some states are more generous than others. Typically, though, unemployment replaces about 45 percent of your lost income.

States have their own eligibility rules about how many hours you must have worked or how much you must have earned, and over what time span. That so-called base period is usually the first four of the previous five calendar quarters. The hour and pay requirements vary, but in some states only full-time workers are eligible.

Benefits are subject to federal income taxes and most state income taxes, according to the Department of Labor, and must be reported on your tax return.

Most states pay benefits for 26 weeks, but some have cut their benefits: Michigan, Missouri and South Carolina pay benefits for 20 weeks; Arkansas pays for 16 weeks; and Alabama pays for 14 weeks. Five states — Florida, Georgia, Kansas, Idaho and North Carolina — have sliding scales tied to unemployment levels, said Michele Evermore, a senior policy analyst for social insurance at the National Employment Law Project.

If you’ve been unemployed for so long that you’ve exhausted your benefits, you may become eligible for extended benefits, which may become available during periods of high unemployment. States with 26 weeks of benefits generally offer an additional 13 weeks, but states with shorter periods typically have shorter extensions, Ms. Evermore added. Extended benefits are paid at the same rate.

Article source: https://www.nytimes.com/2020/03/17/your-money/unemployment-insurance-coronavirus.html

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