Can the self employeed collect Unemplyment?

[BruceNeil]

I am self employeed and hope this would never happen but if my business one day struggles and I need to close my doors, am I able to collect Unemplyment compensation?

If not, and I'm guessing I can't, do I need to have a larger emergency fund than people who are employeed?

[scfr]

Every state is different so you would need to check with your unemployment agency to know for sure, but you probably would not receive unemployment benefits (because you probably have not been paying in).

I believe that YES the self-employed should have a larger emergency fund than the "traditionally employed" unless there is a 2nd earner in the household whose income alone could cover your minimum expenses.

[BruceNeil]

Every state is different so you would need to check with your unemployment agency to know for sure, but you probably would not receive unemployment benefits (because you probably have not been paying in).

I believe that YES the self-employed should have a larger emergency fund than the "traditionally employed" unless there is a 2nd earner in the household whose income alone could cover your minimum expenses.

thank you scfr, I am in Pennsylvania.
and I guess I never broke it down, but I do pay unemployment taxes, is that just a tax I pay for employees and not anything for myself?
thank you for your answer and help

[scfr]

thank you scfr, I am in Pennsylvania.
and I guess I never broke it down, but I do pay unemployment taxes, is that just a tax I pay for employees and not anything for myself?
thank you for your answer and help

If you have a CPA, the easiest thing would be to ask them if you are covered or not. If no CPA, in your shoes I'd call the office where you file your unemployment tax return and ask them. Based on my limited experience (spouse of a self-employed person, former small business owner myself, and used to keep the books for a very small corporate office) in some states an owner is not covered and in some states they may be covered but have the option of opting out of coverage. I know nothing about how things work in Pennsylvania.

As far as emergency fund, back when my husband started his business we had pared our lifestyle way back to where we could live on my income alone and had a medium-size EF. Over time we built a larger EF, one year of expenses plus. Being able to focus your thoughts and energy on yous business and not having to worry as much about the "what if's" of your personal finances is beneficial.

[BruceNeil]

As far as emergency fund, back when my husband started his business we had pared our lifestyle way back to where we could live on my income alone and had a medium-size EF. Over time we built a larger EF, one year of expenses plus. Being able to focus your thoughts and energy on yous business and not having to worry as much about the "what if's" of your personal finances is beneficial.

thank you for your help. so to clear up your point, a self employed person who does not have access to unemployment compensation should have a slightly larger emergency fund. is that correct in your opinion?

[scfr]

thank you for your help. so to clear up your point, a self employed person who does not have access to unemployment compensation should have a slightly larger emergency fund. is that correct in your opinion?

Do you have a spouse who has a reliable income that could cover your basic household expenses? If not, then yes, I believe you should have a larger emergency fund.

[ronantheconan]

Every state is different so you would need to check with your unemployment agency to know for sure, but you probably would not receive unemployment benefits (because you probably have not been paying in).

I believe that YES the self-employed should have a larger emergency fund than the "traditionally employed" unless there is a 2nd earner in the household whose income alone could cover your minimum expenses.

Just one quick question, does self-employed can pay for the benefits of unemployment? Just curious as I'm not really aware of this.