Unemployment Benefits Guide (2021)

If you are new to unemployment benefits and would like to learn more, you’ve come to the right place. Whether you are getting ready to file for unemployment or you are currently receiving benefits and want to learn more about how the program works, we can help.

In this post, we will explain in detail how the Unemployment Insurance (UI) program works and what you need to do to submit a successful application.

We will walk you through eligibility requirements, how to apply, how much you are likely to receive and how long benefits last, what you need to do to stay eligible, what to do if you are denied benefits, and more.

Continue below to see our complete guide.

For COVID-19 related unemployment questions, watch the video below at the end of this article.

"Unemployment Benefits Explained"

What are Unemployment insurance Benefits?

Unemployment benefits are part of an employer-paid program that provides temporary, partial income replacement to qualified individuals who are unemployed through no fault of their own.

Employers pay unemployment insurance taxes and reimbursements that support unemployment benefit payments.

A common misconception about the Unemployment Insurance program is that employees pay into the program while you were working. That is not true.

Rather, Employer taxes pay for unemployment benefits.

Employees do not pay unemployment taxes and employers cannot deduct unemployment taxes from employees’ paychecks.

You may file a claim for unemployment benefits if you meet eligibility requirements set by your state. If you collect benefits, you are legally responsible for following the rules set by your state law.

Unemployment benefits must be reported as income to the Internal Revenue Service (IRS) on form 10-99G.

Who is Eligible for Unemployment Benefits?

Whether you are eligible for unemployment benefits or not depends on your state’s eligibility requirements.

That is because each state sets its own unemployment insurance benefits eligibility guidelines.

However, generally, you may qualify for benefits if you meet the following conditions:

Are unemployed through no fault of your own

In most states, this means you have to have separated from your last job due to a lack of available work.

This means you are out of work for a reason out of your control, such as a layoff.

If you voluntarily quit your job, you are unlikely to be eligible for unemployment benefits.

However, some states may consider your case if you resigned with “good cause,” such as due to unsafe working conditions.

Meet work and wage requirements

To be eligible for unemployment insurance benefits, you must meet your state’s requirements for wages earned or time worked during an established period of time referred to as a “base period.”

In most states, the base period is usually the first four out of the last five completed calendar quarters before the time that your claim is filed.

Some states require applicants to have earned a minimum of $1,000 in the first four of the last five completed calendar quarters.

However, others states require a minimum of $5,000 over the same period.

You are willing to work and actively looking for a job

Another requirement to be eligible for unemployment is to be willing to work and actively searching for work.

This means that should you be offered a suitable job and you refuse it, your unemployment benefits could be terminated.

Each state has its own definition of what is considered suitable, but, generally, this means a position that is similar to work you have previously done.

It also means that the work you are being offered is in line with your education level and experience.

Some states also require you to submit proof that you are searching and applying for jobs to receive benefits.

However, other states, such as Washington state, offer exemptions to that requirement if you are on a training program to develop skills that will help you find work.

Meet any additional state requirements

Lastly, depending on your state, there may be additional requirements you may have to meet to qualify for benefits.

For details about your state’s unemployment eligibility requirements, click here.

When Should I Apply for Unemployment Benefits?

You should file a claim for unemployment benefits as soon as you become unemployed.

When you apply for unemployment benefits, the effective date of your initial claim is important because that is the date that is used to determine when your benefits begin.

Your state’s unemployment office cannot pay benefits for weeks before your claim effective date.

How Do I Apply for Unemployment Insurance Benefits?

To receive unemployment insurance benefits, you need to file a claim with the unemployment insurance program in the state where you worked.

See our complete guide on how to apply for Unemployment benefits in your state, including a link to your state’s unemployment website.

Depending on the state, you may file a claim in person, by telephone, or online.

It is generally recommended that you file for benefits as soon as possible after becoming unemployed.

Also, you should file your claim with the state where you worked.

However, if you worked in a state other than the one where you now live or if you worked in multiple states, the state unemployment insurance agency where you now live can provide information about how to file your claim with other states.

When you file a claim, you will be asked for certain information, including your recent employment history.

To make sure your unemployment claim is not delayed, be sure to give complete and correct information when you apply.

What Information do I need to apply for Unemployment Benefits?

Before you apply for unemployment benefits, you will need to have certain information available to support your claim.

While requirements vary by state, here, generally, here’s a summary of what you need to apply for Unemployment:

  • Social Security number.
  • Driver’s License or State ID number.
  • Employment information for the last 18 months for each employer.
  • Employer identification number, also known as FEIN number, if available. This number can be found on your W2 or 1099 tax form.
  • Employer name (name on pay stub), address, and phone number.
  • First and last day of work.
  • Gross earnings (before taxes) covering the last 18 months.
  • Reason for separation.

How Long Does Unemployment Insurance Benefits Last?

In general, Unemployment benefits are based on a percentage of an individual’s earnings over a recent 52-week period – up to a State maximum amount.

In February 2020, the average weekly benefits were about $387 nationwide.

Before the pandemic, the standard maximum was 26 weeks, but the limit varies by state.

However, additional weeks of benefits called Extended Benefits may be available during times of high unemployment.

Unemployment Benefits are subject to Federal income taxes and must be reported on the individual’s Federal income tax return.

Additionally, you may elect to have the tax withheld by your State’s Unemployment Insurance agency.

How do I stay Eligible for Unemployment Insurance Benefits?

What you have to do to maintain your unemployment benefits differ by state.

However, generally, states require the following in order to maintain weekly eligibility:

  • File weekly or biweekly claims, usually by mail or phone.
  • Be able to work, available to work, and actively seek work each week you claim benefits.
  • Report any earnings from work you had during the week(s). States have different rules for how much money you can earn while receiving benefits.
  • Report any job offers or job offers you decline during the week.
  • If requested, report to your local UI claims office or American Job Center on the scheduled day and time. Benefits may be denied for those who do not attend.
  • Some states require registration for work with the State Employment Service, so it can assist you in finding employment.
    Meet any other state eligibility requirements.

What are American Job Centers

American Job Centers are designed to provide a full range of assistance to job seekers under one roof.

The program was established under the Workforce Investment Act, and reauthorized in the Workforce Innovation and Opportunities Act of 2014.

The centers offer training referrals, career counseling, job listings, and similar employment-related services.

If you are currently unemployed, you will find help in your job search at your local American Job Center. They have a variety of services free of charge.

They can help you with the following:

  • Refer you to job openings in your area, or in other areas if you plan to relocate.
  • Help with resume writing, interview practice, and other job search activities.
  • Refer you to training programs.
  • Some Centers offer testing and counseling to help you explore new careers.
  • If you believe you have special needs or considerations, such as physical needs or other considerations, which may prevent you from getting a job, they can refer you to other agencies for help with those needs.

What if my Unemployment Claim is Denied?

Each state UI Program makes its own decisions about workers’ eligibility for benefits.

You can appeal a decision to deny your unemployment insurance claim.

If you plan to file an appeal, contact your state’s unemployment agency as soon as your claim is denied to learn about the appeal process.

In almost all states, there is a timeframe when an appeal has to be submitted in order for it to be valid for consideration.

While there are many reasons for denying benefit payments; some of the most common are:

  • Being discharged for misconduct connected with work
  • Voluntary Resignation
  • Not actively looking for work
  • Being unable to work
  • Refusing an offer of suitable work
  • Not Meeting Your State’s Earnings Requirements
  • Immigration Status
  • Attending School or Training
  • Failure to File Appeal a Denied Claim on Time
  • Receiving severance pay
  • Knowingly making false statements to obtain benefit payments.

How Will I Recieve my Unemployment Insurance Benefits?

If you are approved for benefits through your state unemployment program, you have options for how you can receive this money.

In most states, you can receive your money either on a state-issued prepaid debit card or by having it directly deposited into your own bank or credit union account or onto an existing prepaid card.

In some states, receiving paper checks is also an option, but most states require that payments be sent electronically.

3 Ways to receive unemployment benefits

Here are the options on how to receive your unemployment benefits.

Option 1 – Direct deposit to your own bank account or prepaid card

You can have your unemployment benefits automatically sent to your checking or savings account or a prepaid card that you already own.

With direct deposit, you receive your money quickly and safely, and you can manage your unemployment benefits just like any other funds in your account.

Additionally, this option eliminates the risk of paper checks getting lost or stolen, as well as the need to physically deposit or cash them at a bank or credit union.

To direct deposit your funds into your bank account or prepaid card, you will generally need the following information:

  • Name(s) on the account
  • Bank or prepaid card account number
  • Bank or prepaid card routing number
  • Type of account (checking or savings). For prepaid cards, select ‘checking’

Option 2 – State-issued prepaid debit card

Most states currently provide the option for you to receive your unemployment benefits through a state-issued prepaid debit card.

States, however, can’t require you to receive unemployment benefits on a state-issued prepaid debit card, so be aware that you do have options, including direct deposit as explained above.

For more on unemployment debit cards in each state, see our page on Unemployment Debit Cards by State.

The four main unemployment debit cards issued by states are:

Way2Go Debit Card (By Comerica Bank)
Bank of America Unemployment Debit Card
ReliaCard (By US Bank)
KeyBank Debit Card (By Key Bank)

Option 3 – Paper check

Some states also allow you to receive your unemployment insurance funds by paper check.

If you prefer this option, check first with your state unemployment website to confirm it’s available to you and to learn how to sign up.

As mentioned above, most states now require unemployment insurance benefit payments to be sent electronically and have completely eliminated the option for paper checks.

How unemployment benefits vary by state (COVID-19 Update)

The video below by CNBC does a great job of explaining how unemployment benefits work.

This includes COVID-19 related changes to unemployment benefits.

Unemployment Benefits Guide Summary

We hope this post on Unemployment Benefits was helpful.

Still Have Questions?

To go to file for unemployment insurance benefits in your state, click here: How to file for unemployment.

Get the login information for your state’s unemployment website here: Unemployment Login by state.

For the phone number to contact your state’s unemployment agency, click here: Unemployment Office Phone Number by State.

To find out the Unemployment Rate in your state, click here: Unemployment rate for all 50 states.

For details about Unemployment Debit Card by state, including the Ways2Go, ReliaCard, and Key2Benefits, click here: Unemployment Debit Cards.

If you have further questions about California Unemployment, Unemployment Benefits, or Unemployment Debit Cards, you can fill out the comment form below and we will answer your question ASAP.

Be sure to check out our other articles on Unemployment Benefits, including:
Whether Unemployment Benefits are Taxable
List of States Extending Unemployment Benefits
Massachusetts DUA Unemployment Debit Card
How to file for Unemployment (in all 50 States)
Unemployment office Phone Number (All 50 States)