unemployment with no salary job

[vdo]

California

curious how to best structure a job working for equity (without salary) while retaining unemployment benefits?

 

[Zigner]

California

curious how to best structure a job working for equity (without salary) while retaining unemployment benefits?

It is rare that you can legally be "hired" and paid in "equity (without salary)" in this (or any) state. This forum will not help you "structure" a criminal enterprise.

 

[cbg]

Those extremely rare situations where one can legally be employed without being paid are generally in an academic setting. If it should happen that you are in one of those situations, your school will know how to structure it. If it's not, then I think you're out of luck.

 

[commentator]

Unemployment benefits are granted because you are just that, unemployed. If you wish to do something for which you are not paid during the time that you are receiving benefits, it cannot be such that it "removes you from the labor force." You are supposed to be able, available and actively seeking work. Or in a special circumstance anticipating recall from an employer. Or in a special circumstance related to the current pandemic situation. In other words, if you do a pick up job of some type and don't get paid for it in regular wages(for example, clean out a garage for someone for cash, not paid through any sort of company payroll) that is not a reportable income. But if you go into a situation where you are reporting for work at a designated time and place and spending a fair chunk of your time there, but they(or you) are deferring payment to you in some manner, you are committing unemployment fraud. Test: is this something that, if your worst enemy were to call in and report you for unemployment fraud, and an investigator came and watched you, or checked out your tax records, or interviewed your nearbys, would they find unemployment fraud?

 

[PayrollHRGuy]

Those extremely rare situations where one can legally be employed without being paid are generally in an academic setting.

In those cases the worker isn't being paid in equity so I doubt they apply here.

The OP is basically asking us how to break multiple laws. Employment, tax, UI.

 

[cbg]

In those cases the worker isn't being paid in equity so I doubt they apply here.

The OP is basically asking us how to break multiple laws. Employment, tax, UI.

Oh, I agree absolutely. That was sort of, indirectly, my point. Sometimes I may be a bit too subtle.

 

[adjusterjack]

Sometimes I may be a bit too subtle.

Uh, no. LOL.

 

[LdiJ]

I can think of a way that it could be structured and be legal:

1. The employer pays enough money in cash to cover withholding for the entire amount of equity + cash earned for that period and submits the proper withholdings to the proper entities and reports the total amount of equity plus cash earned on the employee's W2.

2. The employee reports the full amount of equity plus cash earned for that period to the UI agency.

Now, that may mean that the OP no longer will get unemployment benefits but there is a chance that the OP would still receive partial benefits.

 

[Zigner]

I can think of a way that it could be structured and be legal:

1. The employer pays enough money in cash to cover withholding for the entire amount of equity + cash earned for that period and submits the proper withholdings to the proper entities and reports the total amount of equity plus cash earned on the employee's W2.

2. The employee reports the full amount of equity plus cash earned for that period to the UI agency.

Now, that may mean that the OP no longer will get unemployment benefits but there is a chance that the OP would still receive partial benefits.

Neither of your suggestions are "equity (without salary)".

 

[LdiJ]

Neither of your suggestions are "equity (without salary)".

That was one suggestion with two steps. Both steps are required. It is a way for him to be legally paid with some equity involved AND be legal with the UI folks.

 

[Zigner]

That was one suggestion with two steps. Both steps are required. It is a way for him to be legally paid with some equity involved AND be legal with the UI folks.

But that's not what the OP wants. The OP wants to work and not be paid so that his UI benefits are left intact.

 

[FlyingRon]

That you're not being paid doesn't make you unemployed for UI purposes. If your "equity scheme" means you are unable to work paying jobs, you aren't eligible in California (or other states). Further, the "equity scheme" is likely going to be given a value for unemployment (and possibly tax purposes). Barter is still income.

 

[commentator]

Remember that U.I. is not income based. It is more "availability based," and somewhat contingent on whether you are working for a (taxpaying) covered employer. Barter isn't real income for unemployment purposes because there are no true income measures that determine eligibility. Many people barter their work for food or a place to live, while working at other jobs. If they are separated from their covered employment, this work isn't considered in determining eligibility unless the person starts trying to restrict their days hours or general availability due to such work.

Every so often the powers that be will try to generate ill will toward the unemployment program by saying there has been a "lottery winner" who continued to draw unemployment benefits. In other words, the proverbial welfare queen spending the taxpayers money. However, this situation is totally possible, since unemployment is not income based, and as long as the fabulously wealthy trust funder or lottery winner does not "remove himself from the labor force," in other words is able to make the weekly certifications and is willing to do the required job seeking activities, they can be fully and legitimately eligible. At no point during the certification process is one required to provide income data or answer questions about other possible income unless it deals with this separation such as pensions.

But a person who is working and having their income deferred until some later date, at which time they are going to be paid it in some size shape or fashion is committing unemployment fraud. And in normal times, they'd be picked up on a later examination of their income tax records, cross matched with the unemployment system's tax records. There used to be a few clever ways to escape being caught quickly, which I will not mention, but the fraud units have worked diligently to get hold of them with additional back up checks. And then there is the ubiquitous possibility of being turned in by someone, whether guilty or not, accused of committing unemployment fraud, which will usually in normal times, create an investigation.

From the sound of this, our poster wants to figure a way to keep the benefits coming while doing other things. I'm happy to provide parameters. Up to them whether or not they run legal.