Many folks are out of work right now including self-employed workers, such as massage and other body work therapists, artists, makeup artists, hair stylists, and so on. The new stimulus package has many benefits for you even though you would not typically be eligible for Arizona unemployment insurance. In addition to unemployment benefits, there are tax credits and other benefits for you.
The CARES Act temporarily expands unemployment insurance to cover individuals who are not traditionally covered, including the self-employed, gig-workers, independent contractors, and workers with irregular work history. It also expands the list of allowable criteria for claiming unemployment compensation to include many reasons related to the COVID-19 public health emergency. Contact the unemployment office in the state where you worked to determine your eligibility.
If you exhaust the weeks of unemployment compensation available to you through your state’s laws, you will be eligible for an additional 13 weeks of benefits retroactive to January 27, 2020. These benefits will be federally-funded, but you will still receive them through your state.
Expanded eligibility for unemployment insurance will be in effect until December 31, 2020. A $600 additional benefit will be added to unemployment compensation received for weeks between when the bill is enacted and July 31, 2020. This is tax free.
It depends on the reason for the sick leave. Full time private employees are eligible to take up to 80 hours (two weeks) of paid time at 100% of the employee’s regular pay (up to $511 per day, subject to a total of $5,100) due to quarantine/isolation order, health-care provider guidance to self-quarantine, or seeking diagnosis for symptoms of COVID-19.
Full time private employees sick leave pay is limited to 2/3 of your regular pay (up to $200 per day, subject to a total of $2,000) for caring for someone who is isolated/quarantined and for taking care of a child due to a closure of school or child care.
You are not out of luck if you are a part-time employee. However, the amount of sick leave will be reduced based on the number of hours you would normally work over a two week period.
Private employees are eligible to take up to 12 additional weeks of paid time at 2/3 of the employee’s regular rate of pay (up to $200 per day, subject to a total of $12,000) solely to take care of a minor child due to a closure of school or child care or the unavailability of a child care provider for virus related reasons.
Refundable tax credits are available for independent contractors who would have qualified for coronavirus related paid leave if they were employees. The IRS will be posting information soon on these credits on its website (www.irs.gov), including information on how to claim these credits.
50 percent of certain self-employment taxes are deferred through the end of 2020. Deferred taxes will not become due until end of 2021 and end of 2022, with 50% of the liability being paid at each date.
The Paycheck Protection Program and Economic Emergency Grant Program for Independent Contractors provides assistance through the Small Business Administration’s new Paycheck Protection Program and Economic Injury Emergency Grant Program.
This blog is intended to just highlight the various rescue programs that may be available to you and is not intended to substitute for professional tax advice. McCarthy Family Law is not a tax or accounting firm. Additionally, there are detailed regulations concerning each person’s eligibility and terms of repayment. Please check with your tax advisor.
Message from McCarthy Family Law
Many people are out of work right now including self-employed workers, such as massage and other body work therapists, artists, makeup artists, hair stylists, and so on. The new stimulus package has many benefits for you even though you would not typically be eligible for Arizona unemployment insurance. In addition to unemployment benefits, there are tax credits and other benefits for you. If you are having problems making support payments or paying a property settlement, then these options may help you alleviate that uncertainty. Please call us at 520-623-0341 to explore your options.