Presented by Beverly McBride, CDFA™
The Department of Labor (DOL) sets overall standards for unemployment benefits, and each
state processes applications and determines its residents’ eligibility through its own program.
Generally, most states have a one-week waiting period before eligibility for unemployment
benefits begins, limit the length of unemployment benefits to 26 weeks, and require proof that an applicant is actively looking for a new job. There is no amount of unemployment benefits set by federal law, and the amount received by an unemployed individual varies by state.
In three separate provisions—Federal Pandemic Unemployment Compensation (FPUC),
Pandemic Unemployment Assistance (PUA), and Pandemic Emergency Unemployment
Compensation (PEUC)—the Coronavirus Aid, Relief, and Economic Security Act (CARES Act)
expanded the maximum duration of the benefit time period and increased the amount of
unemployment benefits with a federal supplement. These provisions will become effective in
each state once the state executes an agreement with the DOL regarding the implementation.
Please note: Individuals who work in one state but live in another should apply for
unemployment benefits in their state of employment.
Federal Pandemic Unemployment Compensation
FPUC provides an additional $600 to a state’s weekly unemployment benefit and will be paid
through July 31, 2020. This is a flat supplement that comes solely from federal funding in the
CARES Act. It also includes a nonreduction rule that bars states from changing their formula to
reduce the amount of benefits received.
Pandemic Unemployment Assistance
PUA expanded eligibility for unemployment benefits to individuals who normally could not
receive unemployment benefits under federal law. These individuals include independent
contractors, part-time workers, and those who do not have a sufficient work history. Individuals
who can work from home or who receive paid leave or sick leave from an employer are not
eligible for PUA.
PUA covers all private employers, regardless of how many employees they have. It does not
require a one-week waiting period for unemployment benefits, and its eligibility period begins
retroactively on January 27, 2020, and extends to December 31, 2020. The government will fully
fund the first week of benefits for states that choose to waive their original one-week waiting
periods. States are granted the flexibility to not require recipients to actively seek new
employment while receiving benefits, as it may be impossible to find work in the current
PUA applies to multiple circumstances related to COVID-19 that resulted in unemployment,
including a reduction in work hours, the inability to travel to work, or the closure of schools and
childcare providers. It allows applicants to self-certify that they are experiencing one of the
• The applicant or a household member has been diagnosed with COVID-19 or is
experiencing symptoms of the illness.
• The applicant is caring for a family member or a household member who has a COVID-
• The applicant is the primary caregiver for a child whose school or childcare facility has
closed because of COVID-19.
• The applicant cannot go to work because of a government-ordered quarantine or has been
advised by a health care provider to self-quarantine.
• The applicant can no longer start a new job as the direct result of COVID-19.
• The applicant is now the household’s primary breadwinner because the head of the
household died from COVID-19.
• The applicant was forced to quit his or her job as the direct result of COVID-19.
• The applicant’s employer closed as the direct result of COVID-19.
Pandemic Emergency Unemployment Compensation
PEUC adds 13 weeks to the standard 26 weeks of unemployment benefits available in most
states. The additional 13 weeks means that the CARES Act provides a total of 39 weeks of
unemployment benefits. Individuals can receive the additional 13 weeks even if they exhaust
their eligibility for state unemployment benefits.
Short-Term Compensation Plans
Finally, the CARES Act provides federal funds to states that already have or will implement
shared work or workshare programs. These programs provide prorated unemployment benefits for individuals who experience a reduction in their work hours.
Taxation of Unemployment Benefits
All unemployment benefits, including the $600 PUC, are taxable for federal income tax
purposes. State taxation of unemployment benefits varies, and you will need to verify whether
you will owe state income tax on the benefits received.
You can find more information regarding unemployment benefits provided by the CARES Act
by going to the following websites:
• To learn where to apply in each state, go to www.careeronestop.org and click Find Local
Help > Unemployment Benefits Finder.
• For general information about unemployment insurance, go to www.dol.gov and click
Topics > Unemployment Insurance.
• For information on changes made to unemployment insurance in response to the COVID-
19 pandemic, go to www.careeronestop.org/coronavirus.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.
Beverly McBride, CDFA™ is located at 400 Main St. Cottage 5 St. Simons Island, GA 31522 and can be reached at 912.268.2176 Securities and advisory services offered through Commonwealth Financial Network®, member FINRA/SIPC, a Registered Investment Adviser. Fixed Insurance products and services offered through Crew Financial Collective.
© 2020 Commonwealth Financial Network
This communication is strictly intended for individuals residing in the states of GA, SC, NC, FL, IN, & MI. No offers may be made or accepted from any resident outside these states due to various state requirements and registration requirements regarding investment products and services. Securities and advisory services offered through Commonwealth Financial Network®, Member www.FINRA.org www.SIPC.org , a Registered Investment Adviser. Fixed Insurance products and services offered through
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