UI Online: Reporting Self-Employment and Commissions using UI Online - YouTube

Welcome to UI Online – your fast, convenient, and secure way to certify for continuing unemployment

benefits and manage your claim. In this video, we'll

demonstrate how to answer Question #6 on the claim certification in order to properly report

your earnings for self employment and commissions. In addition, if you work for the entertainment

industry or have regular earnings, you'll want to look at our other instructional videos

specific to these situations. In order to certify for continuing benefits using UI Online,

you first need to register in Benefit Programs Online and create a UI Online account.

If you haven’t created an account yet, or you need information on how to certify, please

see our other instructional videos for help with these topics.

Unemployment Insurance benefits are designed to provide partial wage replacement to unemployed

workers. So, if you're working less than full-time,

you may also be eligible for UI benefits in certain situations. Therefore, it’s important

to properly report all work and wages to the EDD to ensure that you receive the benefits

that you are eligible for. How is your benefit payment calculated?

The EDD uses the information that you provide during the certification process to determine

the amount and type of income that is deductible from your Weekly Benefit Amount. When you

report earnings, the EDD will use the criteria shown on this chart to calculate your payment.

In order to understand how to report self employment, we first need to identify what

self employment is. Generally, you are self employed if any of

the following apply to you: You carry on a trade or business as a sole proprietor or

as an independent contractor. You are a member of a partnership that carries

on a trade or business. You are otherwise in business for yourself (including a part-time

business). Most customers certify for continuing benefits two weeks at a time. If you have

multiple weeks that need to be certified, you'll start with the oldest week first. For

self employment, you must report your earnings on your certification for the weeks in which

the work was performed, regardless of when you actually get paid. Also, don't wait for

your payment to report your earnings. If you receive a payment for self employment, calculate

your earnings by dividing the contracted amount across the contracted time period.

For example, if you receive $1000 for self employment contract work which covered a one

month contract period (30 days), divide the contracted amount ($1000) by the total number

of days covered by the contract (30 days). This would give you approximately $33.33 of

earnings for each day of the contract. Use this amount to calculate your earnings for

each week by multiplying $33.33 (the estimated earnings for each day) by seven, the total

number of days in each week. On your claim certification, you would then enter $233.31

of earnings for each week. In cases where the contract period is not

defined, divide your payment over the time that you performed the work.

For example, you receive a payment of $500 for a project you worked on which took you

14 days to complete. Divide the amount of the payment by the number of days it took

you to complete the project. This would give you approximate earnings for each day you

worked on the project. Next, multiply this amount by seven to get your earnings for each

week. You would then report this amount for each week on your claim certifications.

With self employment, if you're making yourself unavailable for salaried, full-time work in

order to pursue your entrepreneurship, you'll need to answer "Yes" to Question #2 and report

this information to the Department. You only need to report this once during the benefit

year, or if you change your self employment or add additional self employment activity

since you last reported this information. Now that you know a little bit more about

how to report your self employment earnings, let's talk about commissions. A sales commission

is a sum of money paid to an employee upon completion of a task, usually for selling

a certain amount of goods or services. Some examples of industries where employees

may be paid a commission include: The auto industry, such as car sales, retail sales,

and real estate. A commission may be paid in addition to a salary or instead of a salary.

Employees who receive a commission will either know the amount in advance, before getting

paid, or as in most cases, won't know the amount until later, when they actually get

paid. For example, an employee always receives a $5 commission for every $100 of items sold.

In this case, the employee is considered to know the exact amount of commission she'll

receive, as long as she keeps track of the dollar amount of items she sells.

Here's another example, a real estate agent sells a property but won't know the exact

amount of his commission until escrow closes, and he receives his check. In this case, the

real estate agent is not considered to know the amount of his commission in advance.

This is important since when you know how much commission you'll receive (either in

advance, or not until getting paid), will determine on what week of your claim certification

you'll report this information. If you receive commission and you know the

amount of the commission up front, report the commissions on your claim certification

for the week in which they were earned. If the amount is unknown, report the commission

on your claim certification for the week in which you were paid.

Our benefit week is usually Sunday through Saturday. So, when reporting your earnings,

you must report your earnings on your claim certification for that time period only, for

each week. For example, on August 21st, you received a paycheck for commissions in the

amount of $300. This was for $200 of commission you received from sales during the first week,

August 2nd through August 8th, and $100 of commission you received from sales during

the second week, August 9th through August 15th.

If you know the amount of the commission you earned during each week (before actually getting

paid), you would report the commission on the claim certification for the week in which

they were earned, even though you're not actually paid until later. In this example, the $200

would be reported on the claim certification for the first week, and the $100 would be

reported on the claim certification for the second week, even though you're not actually

paid until the third week. Now that we've gone over what self employment and commissions

are, let's talk about how to enter the information using UI Online. This video focuses specifically

on how to answer Question #6 on UI Online to correctly report self employment or commissions.

Question #6 asks, "Did you work or earn any money, whether you were paid or not?" You

should answer "Yes" to Question #6 when you receive self employment or commission. After

selecting "Next," you'll be directed to the next screen where you will answer two follow-up

questions. By selecting "Yes" to Question #6, you've indicated that you need to report

income such as self employment or commissions. Answer “Yes” for the first question to

confirm that you've received any of the income listed. The second question refers to other

types of income, like the ones listed below it. Select "Yes" or "No" to indicate whether

or not you've received any of the income listed. If you received a type of income that doesn't

appear on either list, go ahead and select "Yes" for this question. On another screen,

you'll be given a list of some of the other options that may apply to you. After making

your selection, select "Next" to continue. Now we'll show an example of how to report

self employment using UI Online. When you select "Yes" to Question #6, “Did you work

or earn any money, whether you were paid or not?," and "Yes" to the first follow-up question,

you'll be asked additional questions on the "Work Details" screen, as shown here. Complete

the required fields indicated with an asterisk (*). To begin, enter your company's name and

address. For self employment, this could be your name and home address. Next, enter the

last day you worked for this employer during the week shown above. In this example, you

reported that you worked 12 hours during this week. To calculate your earnings, report your

net pay. This is your gross pay minus the costs, as defined by the IRS, associated with

self employment. Assuming you're self-employed, and you're contracted for $1000 for a week

of work, but you had costs to complete the project of $250, you would take $1000 minus

$250, which would give you your net earnings of $750. This is the only time that net pay

is reported to the EDD. Select your Wage Type. You would choose "Self Employment or Independent

Contract Work Pay." Select "Self Employment" for your employer type.

When answering the question, "Are you still going to work for this employer?," if you

are performing self employment ongoing, and you don't need any more claim certifications,

answer "Yes," if you've finished the job and need to continue collecting benefits, answer

"No." The next question asks, "What is your employment status?" In this example, you'll

select, "Still working part-time or on-call" if the project continues to be ongoing, or

"Laid off due to Lack of Work" if the project has ended and you won't be working at the

moment. Enter additional details about your employment status. For this question, answer

"Yes" if you would have been willing to change or stop your self-employment to accept full-time

work during the week. Answer “No” if you would not have been

willing to stop or change your self-employment to accept full-time employment. In this example,

this box is left unchecked since you are not working full-time and would like to continue

to receive benefits. Select "Yes" or "No" to answer the question, "Do you have any additional

employers to report for this week?" Selecting "Yes" will direct you to a similar screen

for each employer you worked for. For example, if you have an Avon side business

but also work for another employer part-time, you would answer "Yes," so that you could

record the information for both employers, your self employment, and your part-time employer.

Be careful to only provide the amount of earnings you received for the week indicated. After

entering all information for your self employment, you would then select "Next" to continue.

But first, before we continue, let's go over how to report a commission.

Reporting a commission is similar to reporting self employment. You'll even use this same

screen. For this example, we'll just highlight the differences. When you report commission,

you'll enter the actual name and address of the employer who's paying your commission.

When entering the amount of your commission, report the gross amount received, or anticipated,

if known in advance. When selecting your wage type, select commissions. Also, be sure to

select your correct "Employer Type." The most common type of employer is "Private Sector

Employer." When entering additional details about your income, enter details specific

to your commission, such as the week the commission was earned, if the amount of your commission

is unknown in advance. Other than the sections we just highlighted for you, the rest of this

screen should be completed in the same way as for reporting self employment.

After entering all the information for your commission, select "Next" to continue. You’re

almost done. Once you answer all the certification questions, it’s time to review your answers

for accuracy. Please read the Acknowledgement section below. If everything is correct, select

the Acknowledgement check box, at the bottom of the page, and enter your ZIP code. Checking

the box and entering your ZIP code also serves as your electronic signature indicating you

have read and understood the Acknowledgement statement. Customers who make false statements

or withhold information are punishable by law and could be subject to penalties, including

being denied UI benefits, in addition to having to pay back any amount that you were not entitled

to receive with a 30% monetary penalty. If you need to make changes to any of the answers,

simply select the “Previous” button to go back to any of the previous screens. When

you’re ready, select “Submit." Selecting “Submit” finalizes and completes the certification

process for those weeks. You are done! You have successfully submitted your certification

to the EDD when you see this screen with your confirmation

number. You should save this number for your reference

or select the “Confirmation” link to print a copy for your records.

If you have additional weeks that are available to be certified, click the “Return to Certify

for Benefits” button to repeat the process. If you feel that you have reported incorrect

information on the claim certification, just send a message to the EDD through your UI

Online account by selecting the “Contact Us” link at the top of the screen.

Be sure to specify the week, amount reported, and correct amount. We hope you have found

this video helpful on how to properly report your self employment and commission earnings

in a fast, convenient, and secure way online. Additional information about this topic is

available on our EDD website. We also invite you to view our other instructional videos

that are available to learn more about the many different benefits and conveniences of

UI Online.