Eight Most Asked Questions About the CARES Act and the Pandemic Unemployment Assistance Program
1. What is the CARES Act?
First of all, CARES is an acronym for Coronavirus Aid, Relief and Economic Security. This is a government sponsored program, passed by Congress on March 29, 2020 that runs in conjunction with current unemployment insurance programs.
Under the CARES Act, a program called the Pandemic Unemployment Assistance (PUA) was specifically created to come to the aid of workers affected by the COVID-19 virus. This program is designed to provide financial assistance to workers who would not be generally eligible for unemployment insurance under its regular qualification standards.
2. What qualifies as a COVID-19 unemployment situation?
There are several scenarios in which a person might find themselves unemployed and the laws allow states to pay benefits under the following circumstances:
- An employer temporarily ceases operations due to COVID-19, preventing employees from coming to work,
- An individual is quarantined with the expectation of returning to work after the quarantine is over, or
- An individual leaves employment due to a risk of exposure or infection or to care for a family member.
3. Who is eligible to seek financial assistance with the PUA Program?
If you have been impacted by COVID-19 and if you are able to work, including if you are actively seeking work, you are eligible to seek financial assistance with the PUA program if you are:
- an unemployed or partially employed gig worker,
- an independent contractor,
- a freelancer,
- a self-employed business person, or
- seeking employment.
You may also be eligible to seek assistance if you have an insufficient work history that prevents you from qualifying for unemployment insurance benefits or if your unemployment benefits have been exhausted.
4. How do I apply for PUA?
You can apply for PUA the same as you would apply for regular unemployment insurance. Starting April 28, 2020, the Employment Development Department (EDD) began taking applications on their website.
Note: If you have W2 wages, even if they are smaller than your 1099 wages, you still need to file a claim through the regular unemployment insurance system and not the PUA.
As a PUA applicant you would self-declare your income for the 2019 tax year and while you will not need to submit any documents during your initial application, you will need to show income from 2019. It will be helpful to have the following documents handy to help you answer questions adequately on the application:
- Schedule C Tax Forms
5. How much will I receive in benefits?
If you are a successful applicant, you will initially receive the minimum benefit amount of $167 per week, plus, an additional $600 per week as promised by the CARES Act.
For those who are unemployed due to the pandemic, there are three phases to the program’s payout:
- Phase 1: $167 per week for each week you were unemployed from Feb. 2, 2020 to March 28, 2020.
- Phase 2: $167 plus $600 per week for each week you were unemployed from March 29, 2020 to July 25, 2020.
Note: The extra $600 per week comes from the federal CARES Act, which is currently only in effect through July.
- Phase 3: $167 per week for each week you are unemployed from July 26, 2020 to Dec. 26, 2020.
The EDD notes that claims will be backdated to when you became directly impacted by COVID-19, however, the additional $600 per week Federal benefit will only apply to weekly claims from March 29 through July 25, 2020.
Note: If you are already collecting certain unemployment benefits, including unemployment compensation, and if you are eligible, you will receive an additional $600 in federal benefits per week for weeks of unemployment ending on or before July 31, 2020.
6. How do I receive more than the minimum weekly benefit?
First, your PUA claim must be accepted. Then, you will be able to potentially increase your weekly benefit by certifying your actual pay from your business or gig work in 2019. To certify your income, you will need to send in supporting documents to the EDD. Once they analyze your documents and verify your income, they may adjust your weekly benefit payment from the minimum of $167 to a possible maximum of a weekly amount of $450.
The following documents qualify as supporting documents:
- Annual Tax Return
- 1099 Forms
- Pay Stubs
It could take up to 21 days for the certification process to be completed. And, if you are awarded additional assistance, it will also be backdated to when you first received unemployment assistance.
7. How long am I eligible for PUA benefits?
PUA benefits will be available for a maximum of 39 weeks. The program ends December 26, 2020 unless the government extends it further.
8. How long will it take to receive my benefits?
If you already have an EDD debit card from a previous unemployment claim, you should receive your benefits within two days. If you are a new applicant, you can expect to receive benefits within four to seven days upon receiving your new unemployment debit card and mailed checks.
Apply as soon as possible.
Starting April 28, 2020, if you are an eligible worker, you may submit your application to EDD online. It can take up to 21 days to receive a decision and then once a decision is made, payment can take up to four days under the PUA program.
Official information from the White House Task Force about the Coronavirus (COVID-19). https://www.coronavirus.gov/
Information about the coronavirus from the Centers for Disease Control and Prevention. https://www.cdc.gov/coronavirus/2019-ncov/
Learn how to File for Unemployment Insurance https://www.dol.gov/general/topic/unemployment-insurance
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
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© 2020 Marlene Bertrand