Does unemployment count as income for Social Security? California EDD claimants need to know

This is incredibly helpful, thank you. So just to make sure I understand - if I'm not yet collecting SS and I'm getting California EDD UI benefits right now, those weeks don't add to my SS earnings record at all? They just sort of exist in a separate bubble?

Exactly right. Your Social Security earnings record only gets credited when an employer reports wages paid to you and pays FICA taxes on those wages. Unemployment benefits go through California EDD and no FICA taxes are withheld or paid, so nothing gets reported to SSA as a wage credit. Those weeks of UI essentially show as zero-wage periods on your SS earnings record.

wait so does that mean collecting unemployment actually HURTS your social security in the long run? like if youre not working those weeks dont count toward your 35 year calculation?

Technically yes in a limited sense - your SS retirement benefit is calculated based on your highest 35 years of earnings. If unemployment replaces a year where you'd otherwise have zero earnings, it doesn't help your SS calculation at all. But if you already have 35+ years of solid earnings history it probably won't make a noticeable difference to your eventual benefit.

This is actually exactly the kind of strategic thing my financial advisor was hinting at. I'm 63 so I could technically claim SS now but I know waiting increases the monthly amount. The question is whether living on just California EDD UI benefits is sustainable enough to keep waiting.

yeah I'm in basically the same boat, 64 and collecting EDD right now. haven't pulled the trigger on SS yet. following this thread

Good idea going in person to SSA. Did the EDD agent actually know anything about the Social Security interaction question or was that totally outside their scope?

The EDD agent basically confirmed that UI benefits don't get reported to SSA as wages and that the programs are administered completely separately. She said she gets that question a lot from older claimants. She wasn't a SS expert obviously but that confirmation was reassuring. The more detailed SS strategy stuff I got from the in-person SSA visit.

How long did Claimyr take to get you through? I've been trying to reach EDD for two weeks about a separate issue and cannot get anyone on the phone no matter what I do

wait California doesn't tax unemployment?? I had no idea. I've been stressing about state taxes on my EDD payments

Correct, California is one of the states that exempts unemployment compensation from state income tax. Federal income tax still applies though - EDD should have offered you the option to withhold 10% federal tax from your payments when you filed your claim. If you didn't elect withholding you may want to make estimated tax payments to avoid a surprise bill in April.

this is the most useful thing I've read in this whole thread honestly. didn't know about the CA state tax exemption either

Yes, you absolutely can collect both California EDD unemployment benefits and Social Security retirement benefits simultaneously. They are completely independent programs with separate eligibility rules. Collecting one does not disqualify you from the other. The main thing to be aware of is the tax implications since having both income sources can push you into a higher bracket where more of your SS becomes taxable.

oh wow ok that's actually great news. I thought there was some rule against double dipping

The 'double dipping' concern some people have is probably confusion with workers compensation, which in some cases CAN offset SS disability benefits. But regular unemployment and Social Security retirement? No offset, no restriction, collect both freely.

This is something I was also not totally clear on so glad this came up. Good to confirm they're truly independent of each other.

The EDD website does have some of this info scattered around but it's genuinely hard to find and not well organized. The stuff about SS interaction in particular you basically have to know what to search for.

yeah exactly it's like they assume you already know the system before you go looking for help lol

At 66 you're already past full retirement age so the Social Security earnings test doesn't apply to you at all. Even if unemployment DID count as earned income (which it doesn't), it wouldn't matter because the earnings test only applies before you reach your full retirement age. Your SS check is completely untouchable by your unemployment benefits.

That is such a relief to hear. I've been scared to even look at my SS portal since I filed the EDD claim. Thank you.

Agreed with the above. Once you're past FRA your Social Security retirement benefit is locked in and nothing short of fraud or certain government pension situations can reduce it. Collecting California EDD UI on top is completely fine.

That's literally why I mentioned Claimyr earlier in this thread - claimyr.com. When I needed to get actual answers from an EDD agent rather than just forum speculation, the hold time situation was genuinely impossible to deal with on my own. The service navigates the phone queue for you. Check the demo at https://youtu.be/JmuwXR7HA10 if you haven't looked into it yet.

ok I actually watched that video and it looks legit. I've literally tried calling EDD 11 times in the past three weeks and gotten through zero times. Might actually try this

same situation here. the EDD phone system is an absolute nightmare and it shouldn't be this hard just to ask a basic question

Okay this is a nuance I definitely hadn't considered. So even though unemployment doesn't reduce my SS benefit or count toward the earnings test, if I were already collecting SS, the UI income could make MORE of my SS check subject to federal tax?

Exactly. The provisional income formula for SS taxation = adjusted gross income + nontaxable interest + half of SS benefits. Unemployment compensation IS included in AGI so yes, it can push you over the thresholds where 50% or 85% of your SS becomes taxable income. It doesn't reduce your SS payment from SSA but it could mean you owe more at tax time.

This is an important and accurate point. For people who are already drawing SS and then file for California EDD UI, the tax picture can get complicated fast and is worth running by a tax professional.

SSDI (Social Security Disability Insurance) has different rules. For SSDI specifically, there's a concept called Substantial Gainful Activity and unemployment CAN sometimes complicate SSDI eligibility because filing for unemployment typically requires you to certify that you're able and available to work - which can conflict with the disability certification required for SSDI. This is actually an area where you'd want to be careful and probably consult with a Social Security disability attorney before collecting both.

oh yikes. that's more complicated than I thought. thank you for flagging that

Yes SSDI is a very different situation than SS retirement. The able-and-available certification for California EDD unemployment can raise red flags with SSDI since disability technically means you CAN'T do substantial work. Not saying it's impossible to navigate but definitely needs careful handling.

ok this actually convinced me to try it. Did you have any issues with the process?

Nope, pretty straightforward. Way less stressful than the regular hold queue situation. For anyone still on the fence - claimyr.com, watch their video first so you know what to expect

Good to have the EDD agent confirmation. This whole thread has been really educational. I feel like I actually understand how these two programs interact now.

Good question. On the EDD certification form they do ask about other income received during the certification week. Social Security retirement income typically needs to be reported. However, SS retirement is treated differently than wages - it generally does NOT reduce your UI benefit dollar for dollar. California EDD has specific rules about pension and retirement income that could offset UI in some cases, particularly if the employer who laid you off contributed to the pension. Social Security is a federal program so it's handled differently than an employer pension. Worth verifying with EDD directly for your specific situation.

Hmm okay. So I should report it on my weekly cert just to be safe but it probably won't affect my payment?

Reporting it is always the right call - you don't want an overpayment situation later because you didn't disclose income. As for whether it affects payment, SS retirement typically doesn't reduce California EDD UI benefits but the rules around pension offsets are nuanced. An EDD agent can tell you exactly how your SS income is classified for your specific claim type.

At 58 you definitely have time but it's not too early to create a my Social Security account at ssa.gov and look at your earnings record. You can see exactly what years you have credited and what years might be gaps. Knowing that helps you make smarter decisions if you ever end up on California EDD unemployment again.

I just did this and found my record. Some years in my 20s are really low wage years and I now understand those are dragging my projected benefit down. This is genuinely useful information, thank you

Yeah I've been doing my job search activities each week. I'm not ready to fully retire yet - I'd rather find another job if possible, which makes the UI job search requirements actually align with my real situation.

what counts as a job search activity for EDD? I've been applying to jobs but wasn't sure if there were other things that count

EDD accepts various activities: submitting job applications, attending job fairs, creating or updating your resume on CalJOBS or other platforms, contacting employers directly even without a posted opening, attending workshops at the America's Job Center. The main thing is you need to log them accurately in case EDD audits your claim.

Agreed - really grateful for everyone who contributed actual knowledge here. Started the thread confused and now feel like I can actually make an informed decision about my SS timing.

That's what these forums are for. Good luck with your claim and your SS planning - sounds like you have a clear picture now.

Yes, unemployment compensation counts as income for Covered California subsidy calculations. It's included in your modified adjusted gross income (MAGI) which determines your subsidy amount. When you're estimating your annual income for Covered CA enrollment, include your expected UI benefits. If your income ends up different than estimated (say you find a job mid-year), you'll reconcile on your tax return.

Oh wow okay I need to include that when I update my Covered CA application. Thank you, this would have caused me a subsidy mess at tax time

Also worth knowing - when you first lose employer coverage you get a special enrollment period for Covered California. Make sure you're within your window to enroll without a penalty. The clock starts from the date you lost coverage, not the date you filed for California EDD unemployment.

This is exactly the kind of real-world confirmation that's most reassuring. Thank you for sharing.

this is super helpful. real experience > theory every time

okay yeah after reading this whole thread I feel way more confident. Going to finish my California EDD claim without stressing about SS implications