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Can I get EDD benefits after a 6-month W-2 contract job ends?

I'm primarily a freelancer but just got offered a good 6-month contract position with a tech company that's insisting I work as a W-2 employee (not 1099). It's full-time 40 hours/week with decent pay, but I'm wondering what happens when the contract ends - would I be eligible for unemployment benefits? I've never collected unemployment before since I've always been self-employed. Does taking this W-2 contract make me eligible for EDD benefits when it ends? The company made it clear there's no possibility of extension beyond the 6 months. Anyone deal with this situation before?

yes u can apply but they look at ur base period earnings. google edd base period calculator to see if ull qualify and how much ud get. u need enough w2 earnings in the right quarters

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Thanks, I'll check out that calculator. Do you know if they'll deny me because I'll go back to freelancing after the contract ends? Or is it just based on the W-2 earnings?

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Yes, you can absolutely qualify for unemployment after a W-2 contract position ends, even as someone who normally freelances. Here's what you need to know: 1. Your eligibility will depend on your earnings during the base period (typically the first 4 of the last 5 completed calendar quarters before you file) 2. You need to have earned at least $1,300 in your highest quarter during the base period 3. You must be able and available for work when you certify 4. Most importantly, you need to show you're looking for suitable W-2 employment, not just freelance opportunities The key thing is that you can't just voluntarily return to freelancing and expect to collect benefits. EDD will expect you to be looking for traditional employment similar to the contract position. You'll need to document your work search efforts when you certify every two weeks.

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That's super helpful, thanks! So basically I'd need to show I'm looking for another W-2 position rather than just going back to freelancing. That makes sense.

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I was in the EXACT same boat last year!!!! Took a 9-month contract with a marketing agency (W-2) and when it ended I got unemployment no problem. The only weird thing was during my eligibility interview they kept asking if I was "still looking for permanent work" and not just waiting to freelance again. I just said yes and got approved lol. Just document some job applications each week and you'll be fine!!!

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Oh that's good to know! Did they require a specific number of job applications each week? I'm wondering how strict they are about the work search requirements.

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They never gave me an exact number but I always did at least 3 job applications per week just to be safe. Documentation is key!!! Save screenshots of everything!!!!

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The real issue isn't if you CAN apply (you can), but whether you'll be able to certify properly. When you certify every 2 weeks, EDD asks if you refused any work and if you're looking for work. If you're turning down W-2 opportunities to return to freelancing, technically you're refusing suitable work. Also, the "going back to freelance" plan gets tricky because if you're earning any money as a freelancer, you have to report that income when certifying. If you earn over a certain threshold, your weekly benefit amount gets reduced or eliminated. The system is really designed for people transitioning between W-2 jobs, not for contractors who take temporary W-2 positions and then return to self-employment.

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thiss!! its so annoying how edd is setup for traditional employment only. like the gig economy is HUGE in cali but edd still acts like its 1970

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I had this exact situation and trying to get through to EDD to ask questions was a NIGHTMARE. Spent literally 4 days calling non-stop getting busy signals or disconnected. Finally used Claimyr (claimyr.com) and got through to an agent in about 30 minutes. They have a good video showing how it works: https://youtu.be/JmuwXR7HA10?si=TSwYbu_GOwYzt9km The agent confirmed I was eligible after my 6-month contract ended and explained exactly what I needed to do during certification to avoid problems. Basically said I needed to be available for and seeking "suitable employment" which meant similar W-2 work, not necessarily another contract position.

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Thanks for the tip! I'll bookmark that service in case I run into trouble getting through. Did you end up having to do an eligibility interview, or was it pretty straightforward after talking to the agent?

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No interview for me! But I think that was because I got clear instructions from the agent about how to fill everything out correctly. The key is making sure you're very clear about the contract ending (not quitting) and that you're available for similar work.

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PLEASE BE CAREFUL with how you answer the certification questions!!! I was in almost your exact situation and checked the wrong boxes during certification. Said I was "self-employed" because I was doing a tiny bit of freelance work while looking for a new job, and they disqualified me and I had to appeal. THE SYSTEM IS BROKEN and they will use ANY excuse to deny you benefits. If you do ANY freelance work while collecting, report the income but don't identify as self-employed!

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Yikes, that sounds stressful! Did your appeal end up getting approved? How long did the appeal process take?

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Yes it got approved after THREE MONTHS of waiting! I had to have a phone hearing with a judge and everything. Total nightmare. Just be super careful with how you answer the certification questions and you'll avoid all that.

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i dont get why theyr making u do w2 anyway. sounds like they just dont wanna pay employer taxes lol. but ya you can get bennies after as long as u dont quit

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You have it backwards. Companies pay MORE taxes for W-2 employees than 1099 contractors (employer portion of FICA, unemployment insurance, etc). They're likely requiring W-2 status for legal compliance reasons - the IRS has strict rules about who can legitimately be classified as a 1099 contractor vs. an employee.

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oh my bad lol. learned something new today!

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One more thing to consider: If your contract position pays well, you might qualify for a higher weekly benefit amount than someone with lower earnings. California's maximum weekly benefit is $450, and you need to earn at least $11,674 in your highest quarter to qualify for that maximum. Make sure to check the EDD benefit calculator to estimate what you might receive: https://edd.ca.gov/en/uiben/ui-calculator

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That's great to know! The position pays $42/hour, so that would be around $16,800 per quarter before taxes. Sounds like I might qualify for the maximum benefit if I need it.

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Important: When you certify every two weeks, there's a question that asks, "Were you self-employed or did you work for yourself?" Be VERY careful with this question. If you're doing small freelance jobs while collecting unemployment, you should report any earnings but answer "NO" to this question. Otherwise, EDD often flags you as ineligible because they consider you employed. Their system is very black-and-white and doesn't handle hybrid work situations well.

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