You still need to calculate your taxes when you receive unemployment benefits.

All unemployment insurance benefits are subject to both State and Federal taxes. This is important to think about right from the beginning, especially since you are no doubt in need of funds immediately in order to keep up with bills and any job search related expenses. Not to mention continuing to provide the daily necessities for yourself and your family. It can be a great temptation to use the entire amount of each check to meet these needs, but it’s much smarter and less stressful to not suddenly owe money to the State or IRS at the end of the year.

With this in mind, think seriously about making sure that tax owed on each UI check is being set aside each week. You can avoid worrying about taking care of this yourself or overspending your check, by having the tax funds automatically deducted from your weekly UI check , just as you were likely accustomed to with each check from your former employer. When you voluntarily elect to have this done, ten percent is automatically deducted for Federal Income tax (this is not changeable) and you can choose the percentage you would like to have deducted for State Income tax.

You can easily apply for this using the form found at this link: http://www.ncesc1.com/individual/downloads/ncui500tw.dot

Or better yet, you can avoid the extra time and hassle of applying by mail by simply filling out the application online at the same site that you can file your weekly certifications. Here is the link to that site:

https://www.ncesc1.com/individual/individualServices/individualmain.asp

This form also allows you to sign up for direct deposit, simplifying and speeding up the process of receiving your weekly benefits.

You will need to have ready your Social Security number, checking or savings account information, and a voided check (for checking accounts) If you cannot apply online , you will need to downloaded the form, print it, fill it out, and mail it along with your voided check if applicable to the following address:

Employment Security Commission

PO Box 25903

Raleigh, NC

27611-5903

You also have the option to fax the form directly to 919-733-1370.

With all of these simple options, the process should be quick and easy, allowing you to focus on finding new employment and moving forward, while still keeping you on track with your finances by planning well for tax time.

North Carolina Unemployment Rates

According to the Employment Security Commission of North Carolina’s latest review, unemployment rates decreased in 48 of North Carolina’s 100 counties in July. These unemployment rates were not seasonally adjusted but give an idea of what’s happening in the state. There were still unemployment increases in 39 counties, with State and Local government job loss being the biggest cause of the increase. These job losses mainly affected North Carolina’s Metropolitan areas and among government jobs, educational services were the most affected. The Ashville Metropolitan area for example lost 3,100 government jobs in July. That’s 12.1 % of the government workforce in that area.

Currituck County had the lowest unemployment rate for that month, followed by Hyde, Chatham and Orange Counties. Scotland County had the highest unemployment rates, followed by Edgecombe, Rutherford and Vance Counties.

For the entire State, the unemployment rate as of July, was 10.3% (not seasonally adjusted) and $4,538,453,271 of Unemployment Insurance Benefits had been paid up until that point over the course of a year (August 2010 – July 2011 ) .

These numbers of course, can only give us an idea of what’s happening among North Carolina’s employable population. Again, they do not reflect adjustment for seasonal jobs for example. Also, unemployment is determined by the number of people claiming benefits, which requires actively looking for work in order to qualify. Those who give up looking for employment or move away affect the statistics and leave us with more of a general view of the situation in each county.

There is however hope for those included among the number of those currently unemployed. There is Unemployment Benefit Insurance to help sustain them while looking for work, or the better option for some, of returning to school while possibly still being able to receive these benefits. The Federal Pell Grant Scholarship, covering up to $5,350 in education expenses for those who qualify, is a great place to start. www.fafsa.gov. You can read more about this option here: http://www.ncesc1.com/individual/downloads/NCESCPellGrantLetter.pdf

According to ESC Chairman Lynn R. Holmes “The goal of Gov. Perdue, the ESC and our workforce development partners, is to grow jobs and put people back to work.”

Here is the link to the full report from the Employment Security Commission referred to above which was released August26^th http://www.ncesc1.com/PMI/Rates/PressReleases/County/NR_July2011_CountyRates_M.pdf

The new report which will show unemployment rates for the month of August will be released Friday September 16th.

North Caroline Emloyment Compensation

So you have found yourself unemployed and need to be able to move forward without losing the things that you’ve already worked hard for like your home and your vehicle. Basic necessities also still need to be met. You’re about being able to put food on the table, shoes on the kids, and gas in the car. It’s probably time to cut back for a while on how much money is being spent. That may mean in your case as with many others , that nonessentials are just that for the time being.

The good news is that if you meet the following qualifications, you can at least continue to get some compensation while figuring out your next step toward steady income.

To qualify for Unemployment Insurance in the State of North Carolina, you must have been recently employed. You will need to show that during what is considered a “base period”, you were earning wages. The amount of the benefits you will receive and the length of time you qualify to receive them is based on the amount you earned and the amount of time you worked during this “base period” . The exact amount cannot be determined until you actually apply.

You also need to show that you are currently unemployed through no fault of your own (downsizing, company closing, ect)

Then once you have applied and been accepted, there is one “waiting week”, during which time you will not receive any compensation. Your Unemployment Insurance will begin the second week after you have been approved.

You must continue to file your claim each week while showing that you are actively seeking employment. This means generally that you should be following up your job search by applying in person on at least two separate days to at least two separate employers. Keep good written records of these attempts in preparation for periodic reviews of your efforts to diligently seek new employment.

You may need to respond to questions about your continued qualifications and you must report any wages, job offers or any refusal of work for each applicable week.

North Carolina Unemployment Insurance may be exactly what you need to keep your head above water for a short time while you find your next job or career path. If you see that you may qualify based on the criteria mentioned here, you can call The Employment Security Commission of North Carolina seven days a week at this number : 1-877-841-9617

The NCUI 500AB

When an unemployed worker applies for unemployment benefits the North Carolina Employment Security Commission investigates the reason or reasons why employment was terminated. To aid the investigation, the North Carolina Employment Security Commission sends your previous employer a North Carolina Unemployment Insurance 500AB form. To view a sample of this form click on this link. The form asks your previous employer why you were laid off or fired, whatever may be the case. The only termination grounds which are compatible with unemployment insurance benefits is a lack of work or your good faith inability to no longer perform the task you were employed for.

Labor Disputes

One worker posed this question on unemployment benefits. Can you receive unemployment benefits if you are unemployed because you are in a labor dispute strike? The quick answer is it depends. Let us look at this situation a little closer. There are three main scenarios. First scenario, you are in a labor strike and therefore are unemployed. The second scenario, you are not in a labor dispute but your employer can no longer provide work because workers in another of his businesses make it impossible to offer your work. Third scenario, you don’t have work because another business not owned by your employer is going through labor disputes. In scenarios one and two workers are not eligible for unemployment benefits. In scenario three, a worker might be eligible for benefits.

Separation Pay

Some employers offer workers they lay off or fire a severance pay as part of their wage entitlement. Companies are not required to offer separation pay according to North Carolina state law, but once the terms of the separation pay are included in a contract or a company policy they  Separation income can include several types of benefits. It may include wages in lieu of notice, severance pay or sick leave pay. The North Carolina Employment Security Commission considers separation pay as part of your wages, so they will only consider you eligible to receive benefits once the payment period covered by your separation pay has ended. If your employer does not specify the period covered by the separation pay, the North Carolina ESC will determine the period based on your previous weekly wages.

Yes, you must declare all weekly earnings while you are on unemployment insurance benefits. However, this does not mean it will affect you unemployment benefits, it all depends on how much you earn and your weekly benefit amount. It is not only wages you must declare either. You must also report pensions, if employers from your base period contributed into them. If you are on shared work benefits because you are on less than 60 percent of your customary work load or less than three customarily scheduled workdays, you must also declare any income you receive during the week.

Note you must declare any additional income when you work for it, not when you receive it. This is similar to the tax accrual method many businesses must follow when paying taxes. For instance, if you take on some temporary part time work and work 10 hours at $12, you must declare $120 the week after you work those 10 hours. You must not wait until you have receive the money in hand.

Allowance,

However, as we said above, the fact you declare your income does not mean your benefits will suffer a deduction. The Employment Security Department of North Carolina allows workers to earn up to a certain allowance before deducting money from your benefits. How is this allowance calculated? It is based on the worker’s highest earning quarter during his base period. A worker’s base period includes the first four quarters from the last five quarters since filing for unemployment benefits.

This is how it is calculated. You write down the amount you earned in income during the highest paying quarter of your base period. You divide this amount by 13 and multiply it by 10 percent or 0.1. Round-up the amount to the next whole dollar. This is your maximum allowance before your benefits start to suffer.

For example, if you earned $4,000 during your highest earning quarter, you can earn up to $31 a week before any deductions apply

For instance, what should occur if a worker is laid off by an employer and receives a retirement fund at leaving the company. The worker is still too young to retire and rolls the retirement fund into a personal retirement fund. Should any future benefits he may receive from the fund affect unemployment benefits. The Federal Unemployment Tax Act does not say. It leaves it to each state. Most states will not offset any payment from benefits if the retirement fund is not paid but simply rolled over into another retirement fund. After all, at that moment nothing was paid, no income was received, so why should unemployment benefits be reduced. However, some states, including New York and North Carolina, take a different stance.

However, there is a caveat to this law, which allows North Carolina’s Employment Security Department to reduce the unemployment benefits of workers based on their retirement funds, and that is the source of the funds that paid the retirement fund. You see, unemployment benefits can only be deducted if the employer organized and contributed towards the plan. If the plan was paid into by the worker as a personal retirement fund, then it can have no effect on unemployment benefits. However, if the premiums for the retirement fund were paid in full by the employer, they are deducted from UI benefits. On the other hand, if both the worker and the employer contributed towards the plan, the deduction is proportional to the employer’s share in the retirement fund.

This law seems more suited to a time when people retired young and rarely would a pension-age worker opt not to retire at 65. Now workers are forced to work later into their life, or to return to work when retirement funds and savings have dwindled after failed investments due to the economic recession. The American Association of  Retired Persons, feels this law assumes people retire at 65 and that this is no longer a realistic assumption. The AARP is now campaigning to change this law, especially in states like North Carolina that choose the more restricting version of the law. It certainly does not encourage workers to contribute into employer retirement funds that could work against you when you apply for unemployment benefits.

I am 57, i have been with my company for 25 years and can receive a pension type fund that was set up by my company thru a financial company. My job is being shifted to another country. I know i will be receiving unemployment insurance payments once my job ends. My wage earnings are $1000 per week.My question is how do i report the pension type fund that i will receive at the first of each month. The amount i will receive from the financial company will be $800 each month. Do i report this fund for the week i receive it when i call to file my unemployment claim.

I’m afraid Mr. Wilson does not understand well the unemployment law in North Carolina when it comes to unemployment benefits and company-set pensions. The news is not good. Mr. Wilson will have to deduct or offset the pension he receives from his unemployment benefits. Why? Well, according to the Federal Unemployment Tax Act states must offset or reduce unemployment benefites against pensions to avoid “double-dipping”. The Federal Unemployment Tax ACT” does not say by how much a state should offset benefit payments or if it still should occur if the pension fund is not paid but simply rolled on to another pension fund.

Most states do not count a pension rollover, where the funds of the pension are deposited into another pension without the beneficiary having access to them, as a payment and do not use it to offset benefits. However, a dozen states, including North Carolina, consider all company-set pensions as a pension payment and use it to offset unemployment benefits.

According to an article by the New York Times, the Labor Department holds the opinion that rollovers should not affect your unemployment benefits, but they maintain it is up to each state to decide how to apply this rule.

What does this mean for Mr. Wilson? Well, he should take his case the Department of Employment Security of North Carolina, and fight for unemployment benefits without a deduction. However, under current rules he should divide his annual pension amount, divide it by the number of weeks in the year and declare this weekly amount when filing for unemployment benefits. Sadly, in this case it will mean that most if not all of Mr. Wilson’s unemployment benefits will be offset by his pension.

Learn How To Claim Unemployment Benefits In North Carolina.

It is not difficult to file a claim for unemployment benefits in North Carolina. You have several options as to how you go about the original claim. Just the fact that you are now out of a job is difficult enough so it is a relief to find out that it is easy to get the help that you need until you find employment.

There are three main ways to do it. One of them, probably the easiest is online. This can be very quick too so that you might find you have filed and registered for work in less than half an hour. Once you have made the claim online you can not change or update what you have written for four weeks. This is done as a measure to protect against erroneous claims processing. If you do want to make any changes before the end of the four week limit you can do so by contacting ESC (Employment Security Commission).

Some people who would like to file their claim online are worried about security and we do recommend that you change your PIN from time to time. Take care that you never tell anyone this PIN number. When you change your PIN you should enter your last name, date of birth and sex so as to confirm your identity and this must match exactly the information in the ESC: records. If you use different punctuation for example an extra comma, it won´t match and you will not be successful in creating a new PIN. Your user ID which is your Social Security account number and your PIN will give you access to online filing and also Jobs Line and you can in fact use either to file your weekly claim.

The security system used by ESC industry standard security, using SSL (Secure Sockets Layer) encryption and VeriSign Certificate of Authority. If you are interested in learning more about E.S.C security you can check on Browser Information and Settings of course after you have finished filing your claim online you must always make sure that you logout correctly and close your browser program to be sure of keeping your information private. T

hose who file their claim by telephone will not receive their benefits payments any later than those who file online on the same day. Weekly telephone claims are staggered between Monday and Tuesday though, so if you file online you can make your claim earlier. To claim by telephone you can use the toll-free number 1-877-841-9617. This number is available for you to file your initial claim 24 hours a day and every day of the week. If you prefer to file your claim in person you can of course go to the nearest E.S.C. office. There is a complete list of E.S.C. offices which you could find by the contact E.S.C. link or online using the online locator- E.S.C. office locator.

Confused with North Carolina's Unemployment Insurance program? Let us help.

If you are on temporary layoff your employer is responsible for filing your unemployment claims. You may be awarded severance pay which is pay in lieu of notice or perhaps vacation pay and in this case the week covered by the severance pay must pass before you claim benefits for unemployment as this week cannot be counted as the waiting week. If the severance pay is not a full week´s wages it depends on the amount you receive as to whether or not your earnings are excessive. If not you could claim during the same week, otherwise it is normal to claim the first week after the severance payment week.

Eligibility

You will be eligible for unemployment benefits if you have lost your job through no personal negligence. Those who are not still attached to an employer´s payroll immediately register with the ESC. (Employment Security Commission) and subsequently file a claim each week for unemployment benefits. At the same time they are actively looking for employment so as to be back on the workforce as soon as possible. At least twice a week on different days and with at least two different employers they make every effort to find a job. It is necessary to keep a record of the efforts made so that they can be seen by ESC during periodic reviews. Anyone who is claiming and enrolled in Approved Commission Training is exempt from the work search

Requirements

If you are wondering what “a waiting week” might be it is the first week that you file for benefits and this is counted as your waiting week. So don´t wait a week before you file, just make your claim and in that way your first week will be counted as your waiting week.

ESC should be notified if you claim and are eligible to receive benefits but you don´t receive anything within 14 days. Before that if you find that your unemployment payment is late you can check out your Benefit Payment History online or you could call the E.S.C. Jobsline. To do this use the E.S.C. office locator to find the Jobsline phone number for your area. Then wait 48 hours if you file your weekly claims by telephone. Wait five days if your claims are filed for you by your employer or you file by mail before you again check out the status of you claim.

If your claim for benefits is rejected you can appeal the decision in person it you go to your local E.S.C. office. The mailing address for appeals is: Appeals Department P.O.Box 25903 Raleigh, N.C. 27611. The email address is esc.public.appeals@ncesc.gov Either you or your employer can make an appeal and ask for a formal hearing. Appeals to decisions made by the commission have to be made via a petition for judicial review by the Clerk of the Superior Court. A copy of this petition must be given to the commission. If you follow the above mentioned instructions you will receive your benefits sooner.

Need help with your extended benefits? Read on.

As we discussed in our previous article, the new legislation enacted by the North Carolina Congress and signed by Governor Perdue has allowed unemployed workers in North Carolina to continue receiving Extended Benefits. This program is funded by federal and state funding but is dependent on the state reaching certain levels of unemployment and on those level of unemployment rising when compared to the unemployment rates of previous years. There are two set of standards states can choose from. States that do not qualify under the basic trigger levels have the option to change their legislation to qualify under the alternative trigger levels. This alternative standards compares unemployment rates to that of rates three years ago instead of only two years ago. The problem was that as unemployment rates have remained high but without raising for the last two years, North Carolina no longer showed the rise in unemployment required to qualify for Extended Benefits under the original trigger levels. However, the alternative trigger benchmark, which takes into account earlier unemployment rates does allow North Carolina to remain in the program.

If you suffered from the interruption caused by the delay of the North Carolina legislature in making the necessary changes to qualify before the April 16, 2011 deadline arrived, you will be interested to know what you need to do to continue receiving unemployment benefits. Hopefully, you followed the advice posted in this website and you continued filing your weekly benefits regardless of the program ending. When, as in this case, the possibility exists that an unemployment program can be extended, you should always continue filing your weekly benefits so your payments will start again as soon as the program is launched again. If that is your case, you will see your payments start automatically.

However, if you stopped filing for weekly benefits when payments stopped, you will need to re-open a claim with the North Carolina Employment Security Commission. You can do this online by clicking on this link, over the phone by calling 1-866-795-8877 or by visiting an Employment Security Commission office. Click here to find the closest office to you.

What will happen to weeks you filed for since April 16, 2011, which you did not get paid for? These weeks will be paid back, as long as you continued filing for benefits. This illustrates how important it is to stay in the system and continue filing when an unemployment program may be extended.

Am I forced to take any job when receiving extended benefits in North Carolina? Not any job, but nearly. Extended benefits are the last resort for unemployed workers so the rules regulating the types of jobs beneficiaries should accept are more stringent. You must accept any kind of job which pays more than you receive in weekly benefits, is equal or exceeds the federal minimum wage of $7.25 an hour and is offered in writing and registered with the North Carolina employment service. If you are able to do the job but choose not to, you will probably lose your claim to extended benefits.