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Old 01-21-2011, 02:48 PM
 
Location: SoCal
178 posts, read 328,960 times
Reputation: 146
Default Help!! CA EDD benefits and part time consulting question

Hello all,

I sure could use some advice.

I just started Tier II benefits in CA and receive the maximum amount of $450 per week.

There is a company interested in offering me work (drafting) on an "as needed" basis when workload is heavy. This is a contract 1099 position and I will work from home. Work will likely be sporadic and will work 1 day week, then 2 weeks off, then one full week and so on.

My questions are:

1. Basically, how will this affect my benefits? One week I may make only $300. The next will be $0

2. Can I still work two full weeks and jump back on EDD when there is no work?

3. How do I avoid going into a lower EDD pay scale? What I mean is, will a week billed at $300 become the new scale? Therefore, reducing benefits. I've heard that part-time jobs are a no-win situation when combined with EDD. I don't want to shoot myself in the foot and end up broke. So far I'm scraping by on the $450 per week.

4. Should I just send an invoice in maybe $1K lump sums?


Also, please don't take the above the wrong way. I DON'T WANT ANYTHING FOR FREE AND I WANT TO WORK. This also have the potential for full time, so I want to help this guy out. I just can't afford having less income.

Thanks in advance.

MandK
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Old 01-21-2011, 03:29 PM
 
Location: Wisconsin
13,849 posts, read 17,832,289 times
Reputation: 6476
Quote:
Originally Posted by mandK View Post
I just started Tier II benefits in CA and receive the maximum amount of $450 per week.

There is a company interested in offering me work (drafting) on an "as needed" basis when workload is heavy. This is a contract 1099 position and I will work from home. Work will likely be sporadic and will work 1 day week, then 2 weeks off, then one full week and so on.

My questions are:

1. Basically, how will this affect my benefits? One week I may make only $300. The next will be $0

Report the $$ amount as you earn it - not as you are paid. Provided, you are not working full time, California will allow you to keep $25 or 25% of whatever you earn, whichever is greater, deducting the remaining earnings from your benefit, paying you the difference.

So, assume you earn $200. California deducts 75% of that, or $150 from your benefit of $450, paying you $300.
Quote:
Amount of Wages
Although a claimant is required to report to the Department to total gross wages payable, only a portion of those wages affects the claimant's eligibility for benefits under Sections 1252 and 1279.

If the wages allocated to a week claimed are $25.99 or less, such earnings are disregarded and, hence, have no effect on the claimant's eligibility for benefits. If the wages are between. $26 and $99. 99, $25 of the wages are disregarded and the amount remaining is considered to be deductible. If the wages are $100 or more, 25 percent of the wages are disregarded and, therefore, the deductible earnings would be 75 percent of the total wages.

When the deductible earnings equal or exceed the claimant's WBA, he/she is ineligible for benefits under Section 1252 since he/she does not meet the definition of an unemployed individual. When the deductible earnings are less than the claimant's WBA and the claimant has worked less than full-time, he/she would be ineligible for full weekly benefits under Section 1279. If otherwise eligible, the claimant would be paid the difference between his/her WBA and the deductible earnings.

EXAMPLE F
Claimant F worked less than full time and earned gross wages of $85 during the week ending August 4. F's WBA is $55. The amount of deductible earnings is $60 ($85 minus $25) which exceeds the claimant's WBA. Therefore, F is ineligible for benefits under Section 1252.

EXAMPLE G
Claimant G worked less than full time and earned gross wages of $120 during the week ending August 11. G's WBA is $85. The amount of deductible earning is $90 ($120 minus 25% of $120) which exceeds the WBA. Therefore G is ineligible for benefits under Section 1252.

EXAMPLE H
Claimant H worked less than full time and earned gross wages of $93 during the week ending August 18. H's WBA is $95. The amount of deductible earnings is $68 ($93 minus $25) which is less than the WBA. Assuming that H meets all other eligibility requirements, the amount payable would be $27 ($95 minus $68).

EXAMPLE I
Claimant I worked less than full time and earned gross wages of $200 during the week ending August 25. I's WBA is $166. The amount of deductible earnings is $150 ($200 minus 25% of $200) which is less than I's WBA. Assuming that I meets all other eligibility requirements, the amount payable would be $16 ($166 minus $150).

Total and Partial Unemployment TPU 5 - General
2. Can I still work two full weeks and jump back on EDD when there is no work?

Yes. But you will need to call EDD to reopen your claim if you have not claimed for two weeks.

3. How do I avoid going into a lower EDD pay scale? What I mean is, will a week billed at $300 become the new scale? Therefore, reducing benefits. I've heard that part-time jobs are a no-win situation when combined with EDD. I don't want to shoot myself in the foot and end up broke. So far I'm scraping by on the $450 per week.

Your benefit calculation is not affected by 1099 earnings, as no UI tax is paid by the employer. W-2 wages, if sufficient, can affect benefits, however.

4. Should I just send an invoice in maybe $1K lump sums?

No. These earnings must be reported when they are earned, not when they are paid. If you work 10 hours one week, earnings for those 10 hours are reported that week and deducted from your benefit for that week even if they are paid later.

....
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Old 01-21-2011, 04:40 PM
 
Location: SoCal
178 posts, read 328,960 times
Reputation: 146
Thanks Ariadne22!!!

This puts me at ease a bit, as I'm easger to get back to work.

It sound like trouble if I were to say, get a min. wage part-time job with lower w-2 earnings. Do you agree that my WBA will be reduced based on the new W-2?

Also, I must be honest: Your answers make sense, but I'm reading horror stories where people are claiming 1099 earnings and then losing benefits or having checks seriously delayed and going through new phone interviews.

Going through a reclaim process sounds kind of risky as well.

thanks again,

MandK
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Old 01-21-2011, 05:01 PM
 
Location: Wisconsin
13,849 posts, read 17,832,289 times
Reputation: 6476
Quote:
Originally Posted by mandK View Post
It sound like trouble if I were to say, get a min. wage part-time job with lower w-2 earnings. Do you agree that my WBA will be reduced based on the new W-2?

This is possible, but probably not for the first year. Right now HR4213 is in place with allows you to remain on your earlier, higher benefit if a new claim reduces your benefit by $100 or 25%. However, for some reason, CA does not want to allow people to utilize HR4213. By the time you may need it - next year - the entire EUC program may be gone if the new Congress does not extend it, so your being penalized for part-time work may be a moot point, at which point you might very well be happy to have a benefit - any benefit. Do not count on the EUC extensions beyond the end of this year.

Also, I must be honest: Your answers make sense, but I'm reading horror stories where people are claiming 1099 earnings and then losing benefits or having checks seriously delayed and going through new phone interviews.

The problem with 1099 is the implication that you may in fact be a self-employed independent contractor. California is more lenient in how it views self-employment and 1099 work, however. You might want to call or email EDD to see if you can get a straight answer from someone on CA's rules so that you are very careful not appear to be in business for yourself. CA EDD does respond to emails relatively promptly. Also do a search on this board for CA EDD 1099 work and see what comes up. As I recall, CA is not too bad in this area.

Going through a reclaim process sounds kind of risky as well.

It is, but not terribly so. Again, sometimes there is a delay in resumption of benefits. If you can arrange the work so that you only skip claiming for a week, or have the work broken up so that you are always paid something each week, obviously that is preferable.

thanks again,

MandK
You're welcome.

Last edited by Ariadne22; 01-21-2011 at 05:57 PM..
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Old 01-21-2011, 05:55 PM
 
Location: Ocean County, NJ
621 posts, read 1,127,242 times
Reputation: 179
You have to find out about being paid on a 1099 basis with EDD. All you have to do is google EDD and 1099 income and you'll see so many links with people having issues with EDD. In the threads/stories I've read EDD automatically thinks your self employed when you earn on a 1099 basis. In NJ, when you earn via 1099, agents specifically tell you to not claim that you are self employed or it becomes a long PITA headache but I have no idea how Cali EDD handles that. You should contact a rep and go from there
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Old 09-02-2011, 12:05 AM
 
1 posts, read 11,901 times
Reputation: 11
Default 1099 income voids unemployment

Quote:
Originally Posted by mandK View Post
Thanks Ariadne22!!!

This puts me at ease a bit, as I'm easger to get back to work.

It sound like trouble if I were to say, get a min. wage part-time job with lower w-2 earnings. Do you agree that my WBA will be reduced based on the new W-2?

Also, I must be honest: Your answers make sense, but I'm reading horror stories where people are claiming 1099 earnings and then losing benefits or having checks seriously delayed and going through new phone interviews.

Going through a reclaim process sounds kind of risky as well.

thanks again,

MandK
Unfortunately the answer given to you by Ariadne22 was incorrect. The only source of your info should be EDD itself. As an FYI, the minute you take a 1099 gig, you have forfeited ALL benefits as you will be considered self-employed.
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Old 09-02-2011, 12:46 AM
 
Location: Wisconsin
13,849 posts, read 17,832,289 times
Reputation: 6476
Quote:
Originally Posted by amandab11 View Post
Unfortunately the answer given to you by Ariadne22 was incorrect. The only source of your info should be EDD itself. As an FYI, the minute you take a 1099 gig, you have forfeited ALL benefits as you will be considered self-employed.
And you are resurrecting a nine-month old thread for what purpose? I clearly told OP to contact EDD on this issue to avoid the implication of self-employment. Another poster did so, as well. We haven't heard back from her on this issue since January. Can't be more plain than this.
Quote:
Originally Posted by Ariadne22 View Post
The problem with 1099 is the implication that you may in fact be a self-employed independent contractor. California is more lenient in how it views self-employment and 1099 work, however.

You might want to call or email EDD to see if you can get a straight answer from someone on CA's rules so that you are very careful not appear to be in business for yourself. CA EDD does respond to emails relatively promptly.

Also do a search on this board for CA EDD 1099 work and see what comes up. As I recall, CA is not too bad in this area.
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Old 12-13-2011, 03:41 PM
 
1 posts, read 11,218 times
Reputation: 10
i have a quick question.. i don't know much about EDD rules.
If I'm under EDD SDI benefits and offered a full time job but will be paid at lesser rate because of my disability, will I loose ALL of EDD SDI benefits? What if it was a part time job with less pay rate? The pay rate is only a little more than half of what I would get if i wasn't disabled. What instances would i be able to work but still get EDD benefits? thanks in advance.
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Old 12-13-2011, 05:39 PM
 
3,780 posts, read 4,243,630 times
Reputation: 768
Here's how I do the analysis - unless you have quite the savings account to endure a suspension of your benefits and the associated appeals, and the long waits on hold, don't take a job that is inferior to what you had before. That 1099 work is going to be there AFTER your benefits run out.

The system was designed so that you'd retain your purchasing power while looking for a replacement job (one like you had), so that the businesses you patronize don't have to lay off people because you're out of work. It is a countercyclical program to keep a slump in the economy from spiraling into a depression. You should feel absolutely zero guilt in accepting the money and using it for it's intended purpose. Not to mention the first 26 weeks comes right out of the pocket of the employer that put you into this mess in the first place.
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Old 12-13-2011, 05:54 PM
 
Location: Wisconsin
13,849 posts, read 17,832,289 times
Reputation: 6476
Quote:
Originally Posted by confuzhn View Post
i have a quick question.. i don't know much about EDD rules.
If I'm under EDD SDI benefits and offered a full time job but will be paid at lesser rate because of my disability, will I loose ALL of EDD SDI benefits? What if it was a part time job with less pay rate? The pay rate is only a little more than half of what I would get if i wasn't disabled. What instances would i be able to work but still get EDD benefits? thanks in advance.
I suggest you email/call EDD with your questions. Most discussions here revolve around unemployment benefits. Rarely do people post with specifics on CA SDI benefits. CA does allow one to work and collect unemployment benefits, but that may not be at all applicable to SDI. So, you need to talk to them.

Let us know what you learn.
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