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  1. #1
    Join Date
    Jul 2010
    Posts
    10

    Default Can I Apply for Unemployment Insurance if I Have a Business

    My question involves independent contractors in the state of: NY

    I have a C-corp and I am formal president and an only employee of my corp. Until last week, I worked on a contract on corp-to-corp basis. Last week, my client terminated the contract and after last payment my corp obviously does not receive any money, and I don't pay any payroll to myself. I always paid unemployment insurance tax from my corp., both federal and state, as well as all applicable taxes including payroll tax. I had only one contract at a time, so my formal "business" does not receive any other income.

    Can I apply for unemployment benefits? Do I need to dissolve my corporation for that? As of now, I don't want to dissolve it because I hope that eventually I will find another work contract.

    Thanks.

  2. #2
    Join Date
    Oct 2016
    Posts
    2,869

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    How do you pay unemployment tax, or any other payroll taxes, if you don't pay yourself from your corporation?

  3. #3
    Join Date
    Jan 2015
    Posts
    1,135

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    You can certainly apply, but I strongly suspect they'll explain to you why you as the payer, do not qualify. Do call your state unemployment system, the employer tax part, and ask about this. What do you mean that you paid unemployment taxes both federal and state? On whom? Since you had no payroll and no employees, I'm not understanding why you paid it. Did you submit quarterly payroll reports?

  4. #4
    Join Date
    Jul 2010
    Posts
    10

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    Probably I explained situation not clearly. Until August 24 I worked for a client, client paid money (through agency) to my corp, I paid payroll to myself from my corp, and I paid federal and state unemployment insurance tax as well as double (employee and employer sides) payroll tax. After August 24 I don't work, but I still have to receive money from the client for August, but only for work done up to August 24. Of course I will pay payroll to myself as well as all applicable taxes. I am the only one person in my "corporation", and I am the "president" of it. What I suspect is when I apply for unemployment, they will refuse because I am "the president" of a business. Or they can stipulate it that I have to dissolve my C-corporation. I am looking for another job now, and if I happen to find another contract I will need to use my corporation again, so it is very unlikely for me to dissolve the corporation.

  5. #5
    Join Date
    Oct 2016
    Posts
    2,869

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    They will not care about the status of your corporation. I'm not that familiar with NY UI law. But as mentioned you can certainly apply. When you do don't lie at any time in the process.

  6. #6
    Join Date
    Mar 2013
    Posts
    16,864

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    Quote Quoting Marchello
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    What I suspect is when I apply for unemployment, they will refuse because I am "the president" of a business.
    I don't think anybody can predict yes or no so I suggest you file ASAP and see how it goes. The one week waiting period starts when you file, not when the work was over.

    You've already blown a week.

    Even if you are declined, you're no worse off than you are now. No harm in trying.

  7. #7
    Join Date
    Jan 2015
    Posts
    1,135

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    Quote Quoting adjusterjack
    View Post
    I don't think anybody can predict yes or no so I suggest you file ASAP and see how it goes. The one week waiting period starts when you file, not when the work was over.

    You've already blown a week.

    Even if you are declined, you're no worse off than you are now. No harm in trying.
    Exactly. Though I can somewhat expertly predict that in all likelihood, no, you cannot "lay yourself off" that is only true unless there is some really tricky glitch in New York unemployment and tax statutes. Which is possible, I don't feel like looking it up, and you have absolutely nothing to lose by letting the experts tell you, so by all means, apply. It will probably make your rates go up slightly if you are eligible. While I had them on the line, I'd ask them, if I were deemed NOT eligible, if and if so why I am required to pay into the system at all. In my area, a company of one (think it's 3 or less) is not required to do so.

  8. #8
    Join Date
    Mar 2013
    Posts
    16,864

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    Quote Quoting comment/ator
    View Post
    While I had them on the line, I'd ask them, if I were deemed NOT eligible, if and if so why I am required to pay into the system at all.
    I could be wrong but I got the impression that OP paid voluntarily.

  9. #9
    Join Date
    Nov 2017
    Posts
    16

    Default Re: Can I Apply for Unemployment Insurance if I Have a Business

    In this case, you are an independent consultant and they believe that you choose to be employed or not and that your employment is not dependent on a single employer.

    I could be wrong, but that's the way it is in NJ.

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