With the CARES stimulus and subsequent Lost Wage Assistance in the rearview mirror, it’s become even harder to make ends meet. If you’re receiving unemployment benefits, you might be considering a side gig. But will a job disqualify you from your benefits?
No, not if your part-time work earns less than you’re receiving in unemployment insurance. In fact, you can qualify for what’s known as partial unemployment, although the amount you receive will vary by state. (Your weekly benefit payout will be based on a lower percentage of your previous earnings, but how that’s calculated depends on your state as well).
How federal programs affect your benefits
Unemployment is jointly run by the federal government and the states, but a lot of how it pays out is decided at the state level, with most states offering up to 26 weeks in benefits. The federal CARES Act provided 13 additional weeks of federally-funded Pandemic Emergency Unemployment Assistance (PEUC) to all states. In addition, gig workers that normally wouldn’t qualify for unemployment were made eligible under the federal Pandemic Unemployment Assistance (PUA) program. Without new legislation, however, PEUC and PUA will not be paid after December 31, 2020.
How side gig benefits vary by state
States can stop offering extra weeks from the PEUC if the unemployment rate continues to improve, and some states have already done so (Alabama, Arkansas, Idaho, Iowa, Missouri, Nebraska, North Dakota, and Wyoming), according to CNBC. For a comprehensive look at how many weeks of benefits are offered by each state, check out this post by The Street.
Additionally, to encourage part-time work, most states exempt a certain amount of your side gig earnings from counting against your unemployment benefit. It’s known as the “earnings exclusion,” or “earning disregard.” For example, if you made $300 in a week, and the state earnings disregard is $50, only $250 of that income will count against your unemployment benefit, per the National Employment Law project.
Most states’ earnings exclusion is based on a certain percentage of the weekly benefit, while others allow a small, fixed dollar amount (like $50). There’s a wide range, too—Tennessee has no exclusion amount, while North Dakota allows you to keep 60% of your weekly benefit amount. This greatly affects how much money you can earn while still accepting your weekly benefit check.
A side hustle or part-time gig can significantly increase your overall income through the use of earnings exclusions, but where you live matters, too. Since each state calculates your weekly benefit and exclusion differently, you’ll need to research your state to know exactly how your side income counts against your maximum weekly benefit. Since we’re still in a pandemic, knowing whether the time and risk of another job is another factor to consider, too. For information on partial unemployment qualifications in your state, click here.