Since the coronavirus outbreak several weeks ago, which has required many businesses to stay closed, the number of people applying for unemployment insurance benefits has skyrocketed. Some people who are out of work because of stay-at-home orders were also collecting Social Security benefits while working, which leaves an interesting question – do these people qualify for unemployment benefits?
The good news is that someone who is receiving Social Security retirement benefits can collect retirement benefits and unemployment insurance benefits at the same time. This has not always been the case. Many states used to reduce unemployment benefits if the person applying was also receiving Social Security benefits, but all states that used to do this have stopped the practice. The other good thing about unemployment insurance is that it does not count as income, so earnings tests that might reduce retirement benefits for someone who decides to collect retirement benefits early, before full retirement age, will not be impacted negatively.
The unemployment payments people will receive are going to be larger than they normally are for at least 4 months. This is because the stimulus package passed by Congress included a $600 weekly increased added to typical weekly unemployment benefits. It is no clear whether Congress will act to extend the benefits, but it is important to know that unemployment insurance benefits typically do not come close to replacing a person’s fulltime income. It has widely been reported that because so many people are applying for unemployment benefits during the virus outbreak that state online application systems have been overloaded so it is important to stay vigilante in the pursuit of applying for benefits.
