May 5, 2020
A press release was issued on April 29 by the New Jersey Department of Labor and Workforce Development. It announced that recipients of federal Pandemic Unemployment Assistance (PUA) to the self-employed, independent contractors and others who are not usually eligible for unemployment insurance benefits will be notified of their PUA eligibility soon. The Department began to make payments last Friday.
You must be negatively impacted by the coronavirus emergency to be eligible. You will have to certify that you are unemployed, partially unemployed, or unable or unavailable to work for any of a list of coronavirus-related reasons. NJDOL is working with the U.S. Department of Labor (USDOL) to develop the process to assess your application for this new federal program of Pandemic Unemployment Assistance. Visit the USDOL’s website
Unemployment Insurance Relief During COVID-19 Outbreak
for more information.
PUA claims are retroactive to the date you filed a claim and may be backdated to the date you first became eligible. The first week of potential eligibility is the week ending February 8, 2020. PUA benefits are considered taxable income. PUA recipients are also eligible for an extra $600 per week which is also taxable. The $600 per week is retroactive to the week ending April 4, 2020 and ends the week of July 25, 2020.
Self-employed, independent contractors and other workers in this group, who have applied for regular unemployment and been denied, do not have to do anything further.
Claimants must certify for these benefits online each week. The certification schedule -- based on Social Security number -- can be found at
myunemployment.nj.gov
. PUA eligible claimants who certified for benefits last Friday will also receive a separate $600 supplemental payment as part of the CARES Act for each week since March 29. Those who certify this week will receive the CARES Act supplement the following week.
Eligible workers with incomplete wage records will receive weekly PUA payments for the minimum amount of $231, plus the separate $600 weekly supplemental benefit once they certify for benefits. These workers will be contacted separately to update their income information. You may be required to produce income records for 2018 and 2019. A benefit rate adjustment will be made based on updated income information.
Self-employed workers, independent contractors and others who may be eligible for PUA in New Jersey need to know:
- The first step is to apply for state unemployment benefits and be denied.
- If you have already applied for state unemployment, you do not need to do anything else right now.
- If you have not applied for state unemployment benefits, read the instructions
- for self-employed, independent contractors and others not eligible for regular unemployment before you apply.
- If you already applied but did not follow the instructions outlined above your application will still be reviewed for PUA eligibility.
- If you have not heard about your claim there is no reason to call or email. Look for more information in your mail or email inbox.
New Jersey has disbursed more than $1 billion in unemployment benefits to more than 550,000 people since the COVID-19 pandemic hit New Jersey in mid-March.
Tax Credits for the Self-employed, Independent Contractors, Gig Workers, or Platform Workers
As explained in the PUA FAQs, the Families First Coronavirus Response Act (FFCRA) permits a worker who “carries on a trade or business,” and who would be entitled paid leave if she or he were an employee of an employer, to receive tax breaks. The self-employed, independent contractors, gig workers, or platform workers are not entitled to receive emergency paid sick leave or emergency Family and Medical Leave Act (FMLA) childcare leave as direct payments. These workers can obtain equivalent tax breaks in the form a tax credit worth up to 80 hours of emergency paid sick leave to care for yourself or a loved one impacted by coronavirus; and up to 12 weeks (2 weeks unpaid, 10 weeks paid) in emergency FMLA childcare leave to care for your child at home because they have no school or childcare due to coronavirus. This credit is applied against your annual income taxes and it is refundable. This means that you will get a rebate if your sick leave/ childcare leave expenses were greater than your tax bill. The emergency paid leave must be taken between April 1, 2020 and December 31, 2020.
We will continue to monitor this and keep you abreast of changes. Please visit our
COVID-19 Resource Page
for more updates.
Stay safe,
Rich Higgins, CPA
Managing Principal - New Jersey Office
McCarthy & Company
Source:
New Jersey Department of Labor and Workforce Development Press Release. April 29., 2020
Disclaimer: This alert is for informational purposes only and does not constitute professional advice. Information contained in this communication is not intended or written to be used as tax advice, and cannot be used by the recipient to avoid penalties that may be imposed under the Internal Revenue Code. We strongly advise you to seek professional assistance with respect to your specific issue(s).
