schedule C for casual self employment

[chziggy]

What is the name of your state (only U.S. law)? Pennsylvania
How will filing a Schedule C this year affect my PA unemployment compensation claim?
Background
I was laid off this year and have 18 weeks of unemployment comp. I did report 4 weeks of casual work (casual self employment). As a result unemployment comp was interrupted for 4 weeks about 8 weeks ago but my claim is now active again. My Tax guy said file Schedule C for tax benefits, but did not know how this will affect my UC Compensation claim. Since I worked for half a year my deductions (like medical) are limited because of high AGI. Medical insurance expense is our highest expense after mortgage.

 

[commentator]

If you reported the wages and voluntarily removed yourself from the unemployment weeks while you were working, this was all you needed to do in regard to your unemployment insurance.

The unemployment system is not based on your income in any way. The amount you file in your income taxes has no connection to the unemployment system, and they do not cross match the two systems. (Though they do cross match food coupon assistance and medicaid programs which are needs based.) Tax refunds or any kind of non-wage income (a grant, a cash settlement, an inheritance) is not considered reportable income for unemployment purposes.

The way you'd be committing and would be caught for fraud in unemployment would be if if an employer showed in their state wage reporting that they had paid you wages while you were on file as receiving unemployment benefits. Commonly known as "working and drawing." But since you took weeks off from your unemployment while doing this part time work, it should have no effect whatsoever on your unemployment. As I said, they don't give a hoot about the income you made.

 

[chziggy]

More info


to commentator

thanks for the tip!

Since I do not know you, would you please recommend a reference for your advice?

I have been searching the web for this specific subject and even met with accountant - little success. I don't want to break any laws but I want to be aggressive

thanks again

 

[commentator]

Well, if you want to get this straight from PA, you can call the unemployment system in your state and they will answer the question for you. But after many years working within the u.i. systems of several states and with the federal program overall, I can say with authority that your income has no bearing on your eligibility for unemployment insurance in any state.

It is not uncommon for accountants and other financial professionals not to have a lot of expertise in unemployment matters, as they do not work with the system frequently. There are many misconceptions out there.

I cannot see how filing a schedule C reporting the wages you made from self employment would have any affect on your unemployment at all. As we discussed, you did the correct thing by telling the unemployment system you were doing the work, and stopping your claim during the time you were not eligibile based on being able and available and actively seeking work.

But the money you made while doing this work has no bearing on your unemployment eligibility whatsoever. You do not have to be low income to receive unemployment, and though you do report unemployment received as part of your yearly income tax filing, money made (if duely reported, as you did) or your income level will not make you ineligbile for unemployment.

 

[chziggy]

thanks for the tip

to commentator
thanks again

I have interfaced with a few PA Unemployment reps already. It all depends on who answers the phone - their answers are not consistent. One even advised me that "if I don't like an answer, hang up and call again."

I know independent contractor and "self-employment" raise flags. "Casual work" seems to be the correct phrase.

That said, I would rather go with an aggressive strategy provided I know I am not breaking a law.

-peace and happy holidays

 

[sixty19]

I live in New Hampshire and am in the same position as the original poster, from October to December I was doing some casual work and during this time I did not claim unemployment benefits at all. I was still in there system, but was not receiving any checks from unemployment at this time. They said not filing the weekly cliam would be okay. In December I had to reopen a new claim which was approved based on the employer I had for 2 years prior to being laid off in May of 09. would this hold true as well for me.