SELF-EMPLOYED and The CARES ACT
The Coronavirus Aid, Relief and Economic Security Act relief so states can expand their unemployment programs to include self-employed, independent contractors and gig workers.
Highlights:
- State unemployment benefits are expanded to include self-employed and others not normally covered
- Provides $600 per week unemployment benefits
- delays payment of self-employment taxes
STATE UNEMPLOYMENT BENEFITS
Who gets added:
- Self-employed, independent contractors and gig workers
- usually receive a 1099 instead of a W-2 to report earnings
- support to nonprofits, local and state governments so their employees can get unemployment benefits
What are the new benefits
- Everyone who qualifies receives $600 per week
- Unemployment benefits, for those that need it, can get an additional thirteen weeks past the benefit time period their state allows
How to apply:
- File immediately – applications MUST BE FILED by July 31, 2020
- File however your state requires applications for unemployment benefits to be filed
- Online is probably best at the home page for your state
- Go to an unemployemnt office
- Call an office
- Waiting periods to receive benefits have been waived
THE SELF-EMPLOYMENT CONTRIBUTIONS ACT*
The CARES Act modifies when some estimated self-employment taxes are deemed timely paid.
How much can be delayed
- Self- employed persons can delay paying up to 50%of the estimated payments (tax deposits) they are required to make between March 27 till December 31, 2020
When will the delayed payments be due
- usually receive a 1099 instead of a W-2 to report earnings
- support to nonprofits, local and state governments so their employees can get unemployment benefits
- Unemployment benefits, for those that need it, can get an additional thirteen weeks past the benefit time period their state allows
- Online is probably best at the home page for your state
- Go to an unemployemnt office
- Call an office
- 50% of the delayed amount is paid by December 31, 2020 AND
- the total amount is paid by December 31, 2020
There is no limit to how much can be deferred
What tax payments must be paid on time
- Self-employment tax deposits for anyone who gets a Paycheck Protection Program loan, as authorized by the CARES Act, if the loan is later forgiven
- Federal Income Tax Withholding
- Medicare Tax
- Employees portion of Social Security Tax
- All other taxes unless specifically covered in the CARES Act
*/B> The Self-Employment Contributions Act is the 12.4% tax self-employed people pay on net earnings.
These taxes are also paid on wages of employees.
Keep updated as the Government lets us know
how this works and any changes