With the economy continuing to sputter, some workers see the writing on the wall at their companies and need to know what unemployment benefits are and how to apply for them.
What Is It?
For those who may not know, unemployment benefits exist to provide workers, who are unemployed through no fault of their own, with a little money for 26 weeks or longer or until they find a new job. These benefits come from state unemployment insurance programs within guidelines established by federal law.
We already noted that to be eligible, workers must be determined to be unemployed through no fault of their own. That usually means that they were laid off by a company looking to save money. Depending on the laws in your state, you may not be eligible to collect unemployment benefits, if you:
- Quit without good cause
- Were fired for misconduct
- Resigned because of illness
- Left to get married
- Are self-employed
- Were involved in a labor dispute
- Were attending school
If you quit your job with "good cause," you may be able to collect. It's up to your state unemployment office to decide.
The amount you receive depending on the rules of your state and your previous income. The more you made, the more you can receive, but the maximum amount typically does not exceed half of what you earned and often it is much less than that.
Length Of Benefits
In most states workers can receive benefits for 26 weeks – longer during periods of high unemployment. Workers also can apply for additional benefits after the 26-week period ends.
Filing For Benefits
After you've been laid off, waste no time before filing for unemployment. It typically takes a few weeks before you receive your first check, so the sooner you apply, the sooner you'll receive money. However, it can take four weeks or longer to receive your first check if lots of others also are applying for them.
To determine the best way to file, find out the rules of your state. Some allow filing online or over the phone, but others require you to do it in person. Filing online is almost always the easiest and fastest way to do it.
Regardless of how you do it, in just about every state, you'll need to provide your Social Security number (or alien registration card if you're not a U.S. citizen), your mailing address and phone number as well as the names, addresses and dates of employment of all your past employers for the last two years.
Many states require you to apply for two jobs per week to continue to receive unemployment benefits. These states may require you to submit the names and phone numbers of the people who accepted your job applications or even copies of the applications. Check with your state to find out what you need to do.
After 26 Weeks
As we've pointed out, most states pay unemployment benefits for 26 weeks, an amount of time deemed to be adequate to allow most unemployed people to find a comparable job. But some who lose their jobs have a more difficult time than others finding another one. In those cases, benefits are extended beyond 26 weeks, potentially for a year or longer. There are cases of workers collecting unemployment benefits for years, but many states make it increasingly difficult and time consuming to reapply for these benefits, and it is more likely that people who cannot find work eventually stop receiving benefits.
Regardless of where you live, you need to know that unemployment benefits are taxable, but taxes are not automatically withheld, so you have a choice to have taxes withheld from your checks or you can set aside extra money so you aren't unpleasantly surprised by the tax bill later. If you are unemployed and temporarily dependent on your unemployment benefit check, it may not be realistic to set aside money and not touch it.