Tuesday, January 19, 2010

Time Magazine thinks that extended unemployment benefits may increase joblessness

According to a recent story in Time Magazine, there is "a Limit to Compassion". The article figures that with extending the unemployment benefits for up to 99 weeks, congress and the president actually provides the jobless incentive to wait around for jobs---not taking low-paying jobs or a position that would require you to relocate.

Because there's evidence that the extensions are only prolonging joblessness. Today's unemployment rate remains high not because of mass layoffs — most of which happened early last year — but mainly because more people are remaining unemployed for longer periods. In academic parlance, the "exit rate" from the unemployment pool is only around 21%, compared with 34% during the last harsh recession, in 1982.

Unadjusted Unemployment Data - 2008 vs 2009 vs 2010

This short video shows the unadjusted initial unemployment claims statistics for the United States over the past several years. It utilizes ribbon charts to compare 2008, 2009 and 2010 to earlier years. You can see both the seasonality in the unemployment claims as well the big spike up in numbers seen in late 2008 and during all of 2009.

Friday, January 15, 2010

Do I pay income taxes on my unemployment income?

According to the IRS you better be ready to claim your unemployment income on your 1040 tax forms---What the government gives, the government takes away.

Topic 418 - Unemployment Compensation

Unemployment compensation is includible in gross income. You must report unemployment compensation on line 19 of Form 1040, line 13 of Form 1040A, or line 3 of Form 1040EZ. However, for 2009, the first $2,400 of unemployment compensation is excluded from income and should be excluded from the amount reported on your tax return.

Unemployment compensation generally includes any amounts received under the unemployment compensation laws of the United States or of a state. It includes state unemployment insurance benefits and benefits paid to you by a state or the District of Columbia from the Federal Unemployment Trust Fund. It also includes railroad unemployment compensation benefits, disability benefits paid as a substitute for unemployment compensation, trade readjustment allowances under the Trade Act of 1974, and unemployment assistance under the Disaster Relief and Emergency Assistance Act of 1974. Unemployment compensation does not include worker's compensation.

If you received unemployment compensation during the year, you should receive Form 1099-G (PDF) showing the amount you were paid. Any unemployment compensation received during the year must be included in your income, unless you contributed to the fund. See Below. In addition, for 2009, the first $2,400 of unemployment compensation is excluded from gross income.

If you received unemployment compensation, you may be required to make quarterly estimated tax payments. However, you can choose to have federal income tax withheld. For more information, refer to Form W-4V (PDF), Voluntary Withholding Request.

Supplemental unemployment benefits received from a company financed fund are not considered unemployment compensation for this purpose. These benefits are taxable as wages, and are subject to income tax withholding. They may be subject to social security and Medicare taxes as well. Supplemental unemployment benefits are reported to you on Form W-2 (PDF). For more information about supplemental unemployment benefits, see Publication 15-A (PDF) , section 5, page 12.

Unemployment benefits from a private fund (or, in some cases, public fund) to which you voluntarily contribute are taxable only if the amounts you receive are more than your total payments into the fund. This taxable amount is not unemployment compensation; it is reported as other income on Form 1040 (PDF).

For more information, see Unemployment Benefits in Publication 525, on page 27.

Friday, January 8, 2010

Maryland Unemployment Line Busy Signal

WBAL reports that thousands of jobless people in Maryland are spending hours on hold, with busy signals or having the system hang up on them.

The Baltimore news station's I-team's Barry Simms reports that Maryland doesn't have unemployment offices where people can go to for help---They must use the internet or call the number---For many it becomes a near full time job just to try and file their UI claim.

DLLR claims that 120,000 Marylanders were collecting unemployment and the plan to improve service levels are to hire an additional 25 people and to upgrade its computer systems.

Federal Cobra Subsidy Extended 6 more Months

Federal subsidy program for COBRA extended

Thursday, January 7, 2010 Insurance Commissioner Wayne Goodwin announced Tuesday that the federal subsidy program for COBRA coverage for involuntarily terminated workers has been extended.

The extension allows the subsidy to remain in effect for an additional six months, for a total of 15 months worth of subsidy payments. The subsidy pays for 65 percent of the premium for both COBRA and mini-COBRA (see below for mini-COBRA definition) recipients who are involuntarily terminated from their jobs between Sept. 1, 2008 to Feb. 28, 2010. Workers are responsible for paying the remaining 35 percent.

Read the rest of the story at The Snap Online.

Thursday, January 7, 2010

California's UI Fund To Run Huge Deficits

Click on Chart for a Larger Image

How bad are things in the state of California?

Well according to an Unemployment Insurance (UI) Fund forecast issued by California's Employment Development Department (EDD), the fund which is currently about $8 billion underfunded will be over $27 billion in the red by 2011!

That's almost $1,000 for every man, woman and child in the state of California---Or almost $2,000 for every worker in the state---It will likely be many many years before CA is able to dig out of this hole.

Extended Unemployment Insurance Benefits in Michigan

If you're confused by what UI extensions you may be elligible to receive if you're an out of work Michigander, you may want to spend 18 minutes watching this webinar.

It's a pretty dry presentation that explains how after you exhaust your regular benefits you get EUC (Emergency Unemployment Compensation), then EUC-Tier 2, then Extended Benefits (EB).

Michigan also has plenty of other webcasts for the unemployed worker located here.

How Many Weeks of Unemployment do New Yorkers Qualify For?

The State of New York realizes that it can be confusing for people to know just how many weeks of unemployment insurance benefits they can get while they are jobless.

That is why they published this handy chart and calculator to help you figure out how long the checks will keep coming (as long as you're actively looking for work).

You'll need to know the date of your Original Claim (OC).

How Many weeks of Unemployment Benefits do New Yorkers Get

*OC effective May 1, 2006 - May 12, 2008 26 weeks of regular UI
20 weeks of EUC-Tier 1
13 weeks of EUC-Tier 2
20 weeks of EB
14 weeks of EUC
(13 weeks Tier 3 and 1 week Tier 2)
6 weeks of EUC - Tier 4
99 weeks total
*OC effective May 19, 2008 - Aug. 18, 2008 26 weeks of regular UI
20 weeks of EUC-Tier 1
13 weeks of EUC-Tier 2
20 weeks of EB
14 weeks of EUC
(13 weeks Tier 3 and 1 week Tier 2)
93 weeks total
*OC effective Aug. 25, 2008 - Sept. 8, 2008 26 weeks of regular UI
20 weeks of EUC-Tier 1
13 weeks of EUC-Tier 2
17-19 weeks of EB (payable up to 2/28/10)
14 weeks of EUC (13 weeks Tier 3 and 1 week Tier 2)
73 weeks plus 17-19 weeks of EB based on last payable week
*OC effective Sept. 15, 2008 – Sept. 29, 2008 26 weeks of regular UI
20 weeks of EUC - Tier 1
13 weeks of EUC - Tier 2
14 weeks of EUC
(13 weeks Tier 3 and 1 week Tier 2)
6 weeks of EUC - Tier 4
79 weeks total
*OC effective Oct. 6, 2008 – Jan. 5, 2009 26 weeks of regular UI
20 weeks of EUC - Tier 1
13 weeks of EUC - Tier 2
14 weeks of EUC
(13 weeks Tier 3 and 1 week Tier 2)
73 weeks total
*OC effective Jan. 12, 2009 - Apr. 6, 2009 26 weeks of regular UI
20 weeks of EUC - Tier 1
14 weeks of EUC - Tier 2
60 weeks total
*OC effective Apr. 13, 2009 - Aug. 17, 2009 26 weeks of regular UI
20 weeks of EUC - Tier 1
46 weeks total
*OC effective Aug. 24, 2009 and later: 26 weeks of regular UI only

* An Original Claim's (OC) effective date is the Monday of the week in which the claim is filed.

UI = Regular Unemployment Insurance Benefits

EUC = Emergency Unemployment Compensation

EB= Extended Benefits

(Note: This data was accurate as of January 2010, it's possible that as time goes on more extensions are given to each group).

Wednesday, January 6, 2010

ADP Jobs Report shows an Increase in Service Jobs

This morning ADP reported that overall jobs were down 84,000 last month, but the service sector actually saw an increase in jobs.

Jake at economPic Data created the chart below that nicely shows how it has been well over a year since the service industry was a net producer of jobs on a month-on-month basis.

Unfortunately, manufacturing has steadily been dropping drops for years & years.

Click on Chart for a Larger Image.

If you wish to read the entire ADP December 2009 Jobs report, click here.