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Unemployment benefits: who could get $400 and what's the Mixed Earner Unemployment Compensation?

The MEUC provides $100 per week in additional unemployment benefits on top of the $300 for people with both a traditional job and who are self-employed.

The MEUC provides $100 per week in additional unemployment benefits on top of the $300 for people with both a traditional job and who are self-employed.

Congress avoided letting the economy go off a cliff at the end of 2020 when it passed the $900 billion coronavirus relief package. The President dithered in signing the bill making a last-minute call for $2000 stimulus checks, as well as other changes, causing the unemployment benefits to expire for millions of Americans. Fortunately, many states were able to avoid serious issues resulting from the delay and were able to begin sending out payments.

The latest relief bill extended unemployment benefits topping up state unemployment payments with an extra $300 per week. For individuals that have a mixed income, where they earn money from both an employer and a side business, the legislation also includes an extra $100 per week in Mixed Earner Unemployment Compensation, or MEUC, letting those individuals get up to $400 per week, but only if their state opts in.

Why do mixed earners get an extra $100?

The extra money is an imperfect fix for people who file income on both W-2 and 1099 forms - used by gig workers, freelancers and other self-employed workers. Income filed on a 1099 form is not counted toward state insurance, so they receive smaller unemployment benefits than if based on the entirety of their income. During the covid-19 pandemic when unemployment soared mixed-wage workers were unable to access the Pandemic Unemployment Assistance set up for gig workers and the self-employed and had to rely on only the state unemployment benefits.

Who is eligible for the $100 MEUC payments?

Workers who currently receive at least $1 in state unemployment benefits and who earned a minimum of $5,000 in 2019 qualify for the additional $100 per week. The extra money will be effective for the weeks between 27 December, 2020 through 14 March, 2021. People who start a new claim this year will have to prove earnings of at least $5,000 in self-employment income from 2020.

Individuals on long-term jobless aid through Pandemic Emergency Unemployment Compensation or their state’s Extended Benefits are eligible for the extra $100 MEUC payments. Self-employed and gig workers without traditional wage income receiving Pandemic Unemployment Assistance are not eligible for MEUC.

Almost all the states have signed up to pay the additional funds with the exception of two, Idaho and South Dakota. So far at least 18 states have begun paying out the $300 in additional unemployment but the $100 extra may take longer to get out.

Why do states opt out of the extra $100 weekly payment

The $100 additional payment for the self-employed will not be automatically implemented by all the states. Even though no money comes out of the states’ coffers, the program is paid for by the federal government, it requires extra administrative work it will take to get the system up and running. This was one of the reasons states took so long to pay out the extra $300 per week Lost Wage Assistance authorized by President Trump in August using FEMA emergency funds.

One of the difficulties involved is the required paperwork to avoid fraud that plagued the unemployment benefits paid out under the CARES Act. Each state is expected to announce what paperwork they will require in the coming days, the federal government sets guidelines but the states choose what additional requirements they will set.

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