Self-Employed

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

  • Delayed payments are considered timely paid if:
    • 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

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