I occasionally get asked whether a self-employed person can receive unemployment. In theory, the answer to the question is yes, though practicalities may make collecting impossible.
In order to collect, a claimant must be unemployed and must be able and available for work. If someone is not employed by someone else, is able and available for work, and is seeking gainful employment weekly as required, it is theoretically possible for the claimant to be self-employed in odd jobs. All earnings from self-employment, however, must be reported – in gross, NOT in net – to the Unemployment Insurance Division. An allowance of $100.00 per week is excused without effective penalty, i.e. one must report ALL such earnings, but there’s no effect on the weekly benefit amount for the first $100.00 per week of earnings from any source.
It is possible to earn from odd jobs that constitute self-employment, or from part-time short-term temp employment, while on unemployment until one finds full-time work in Maryland. The more that the self-employed worker earns, however, the more challenging it will be practically to maintain the case that the claimant is able and available. In addition, the more that the self-employed worker earns, the lower will be the actual payout from UI benefits going forward.
Any person contemplating an extended period of concurrent unemployment and self-employment should consult legal counsel carefully as the facts may make a UI benefits claim difficult, impractical or outright illegal. Receiving UI benefits while self-employed is not absolutely prohibited, so long as one fulfill all statutory and regulatory requirements including strict candor as to all earnings.
