Can you collect unemployment if you have a side business - NYS Department of Labor rules?
I got laid off from my full-time marketing job last month and need to file for unemployment benefits. The thing is, I've had a small freelance graphic design business on the side for about two years that brings in maybe $200-400 a month depending on clients. I'm worried that having this side business will disqualify me from getting NYS Department of Labor benefits. Do I need to report this income? Will they deny my claim because I'm technically 'self-employed' even though it's just a tiny side gig? I really need the unemployment to cover my rent while I look for another full-time position.
22 comments

Hannah Flores
You can absolutely collect unemployment with a side business, but you MUST report all income when you file your weekly claims. NYS Department of Labor allows you to earn up to a certain amount before it affects your benefits. For 2025, you can earn up to $504 per week before any deductions are made from your unemployment payment. Anything over that gets deducted dollar-for-dollar from your weekly benefit amount.
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Dominic Green
AuthorThat's really helpful! So as long as I'm making under $504 from the freelance work, my full unemployment benefit won't be reduced at all?
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Kayla Jacobson
just be honest about everything when you file your weekly claims. i had a part time job while collecting and as long as you report it they dont care. the online system will calculate everything for you automatically
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William Rivera
The key thing is you have to be available for full-time work. If your side business prevents you from accepting a full-time job, that could be an issue. But if it's just freelance work you do in your spare time, you should be fine. Make sure you're still doing your required job search activities - that's usually 3 work search contacts per week for NYS Department of Labor.
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Grace Lee
Wait, I thought the job search requirement was different now? I've been doing 2 contacts per week and haven't had any issues with my weekly claims.
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Mia Roberts
I had a nightmare trying to get through to NYS Department of Labor when I had questions about reporting my Uber income. Spent hours on hold just to get disconnected. Finally used this service called Claimyr (claimyr.com) that got me connected to an actual agent in like 20 minutes. They have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Totally worth it when you need to talk to someone about these kinds of income reporting questions.
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Dominic Green
AuthorThanks for the tip! I might need to use that if I run into issues when I start filing my weekly claims.
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The Boss
Whatever you do, DON'T try to hide the income. They cross-reference with tax records and if they catch you not reporting income, they'll hit you with an overpayment and possibly fraud charges. I've seen people get in serious trouble for not reporting even small amounts.
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Evan Kalinowski
same situation here! i have a small etsy shop and was worried about the same thing. turns out as long as youre looking for full time work and report everything honestly its no problem at all
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Misterclamation Skyblue
I'm in a similar boat - just started collecting unemployment last week and have been stressing about my small tutoring side business. Reading through these responses is super reassuring! One thing I learned from my caseworker is that you also need to keep good records of your freelance income in case they ever audit your claim. I've been tracking everything in a simple spreadsheet with dates, client names, and amounts earned. Also wanted to add that the $504 threshold Hannah mentioned can change year to year, so it's worth double-checking the current amount on the NYS DOL website when you file your weekly claims.
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Atticus Domingo
Great thread everyone! Just wanted to add that when you're reporting your freelance income on the weekly claims, make sure you report it for the week you actually EARNED it, not when you got paid. So if you completed a project on Tuesday but didn't get paid until the following week, you report that income for the week you did the work. This tripped me up initially because I was reporting based on when payments hit my bank account. Also, if you have any business expenses related to your freelance work (like software subscriptions, supplies, etc.), you can usually deduct those from your reported income - but definitely verify this with NYS DOL since rules can be specific about what qualifies as legitimate business expenses.
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Charlotte Jones
This is really valuable info about reporting income for the week you earned it vs when you got paid! I definitely would have made that mistake. Quick question - when you mention deducting business expenses, do you just subtract those from your gross income when reporting on the weekly claim form? Or is there a separate section where you list expenses? I have some recurring software subscriptions for my design work that would definitely help reduce my reportable income if I can deduct them properly.
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Natasha Volkova
Great question Charlotte! From my experience, you typically subtract legitimate business expenses from your gross freelance income before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in software subscription costs that week, you'd report $250. However, NYS DOL can be pretty specific about what expenses qualify - they usually need to be directly related to earning that income. I'd definitely recommend calling them or checking their website for the official list of allowable deductions before your first claim. Better to be 100% sure than guess and potentially mess up your benefits!
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Lilah Brooks
@Charlotte Jones From what I understand, you typically subtract legitimate business expenses from your gross earnings before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in business expenses that week, you d'report $250. However, I d'strongly recommend calling NYS DOL directly or using that Claimyr service someone mentioned earlier to get the exact details on what expenses qualify and how to properly calculate them. The rules can be pretty specific about what counts as a deductible business expense for unemployment purposes, and you want to make sure you re'doing it correctly to avoid any issues down the road.
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Andre Rousseau
@Charlotte Jones From what I experienced, you typically subtract the business expenses from your gross income before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in legitimate business expenses that week, you d'report $250. However, I d'strongly recommend calling NYS DOL or checking their website for the specific rules about what expenses qualify and how to properly calculate them. Some expenses might need to be prorated if they re'monthly subscriptions like software. Better to get it right from the start than have to deal with corrections later!
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Jasmine Hancock
From my experience with NYS DOL, you typically subtract legitimate business expenses from your gross freelance income before reporting it on your weekly claim. So if you earned $300 but had $50 in business expenses that week, you'd report $250. However, the weekly claim form itself doesn't usually have a separate detailed breakdown section for expenses - you just report the net amount. That said, you absolutely need to keep detailed records of both your income AND expenses because if they ever question your reported amounts, you'll need to provide documentation. I'd recommend keeping receipts for software subscriptions, equipment, supplies, etc. Some people also call the DOL directly to confirm which specific expenses qualify, since the rules can be pretty specific about what counts as a legitimate business deduction.
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Mateo Hernandez
From my experience with NYS DOL, you typically calculate your net income (gross income minus legitimate business expenses) and report that final number on your weekly claim. There isn't usually a separate section for itemizing expenses - you just do the math yourself and report the net amount. However, you absolutely need to keep detailed records of both your income AND expenses because if they ever question it, you'll need to provide documentation showing how you calculated that net figure. I'd recommend keeping receipts for everything and maybe even creating a simple monthly summary showing gross income, total expenses, and net reportable income. That way you have a clear paper trail if questions come up later.
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Daniel Price
Great question about the business expenses! From my experience, you typically subtract legitimate business expenses from your gross freelance income before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in business expenses that week, you'd report $250. However, NYS DOL can be pretty specific about what qualifies as deductible expenses, so I'd definitely recommend calling them or checking their website for the official guidelines. Software subscriptions that are directly related to your freelance work should generally qualify, but they might want documentation. Better to be conservative and get clarification upfront than have issues later during a potential audit.
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Vera Visnjic
@Charlotte Jones From what I understand, you typically subtract legitimate business expenses from your gross earnings before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in business expenses that week, you d'report $250. However, NYS DOL can be pretty strict about what qualifies as deductible expenses - they usually need to be directly related to earning that specific income. Your design software subscriptions would likely qualify, but I d'recommend calling them or checking their website for the official list of acceptable deductions. Better to be conservative and ask than to get flagged for improper reporting later!
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Connor O'Neill
Great question Charlotte! From my experience, you typically subtract the business expenses from your gross earnings before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in legitimate business expenses that week, you'd report $250. However, you need to be careful about what expenses qualify - generally it's things directly related to earning that income like software subscriptions, materials, or equipment used specifically for the freelance work. I'd recommend calling NYS DOL to confirm exactly how they want you to handle expense deductions on the weekly claim form, since different states sometimes have different procedures. Better to get it right from the start than have to deal with corrections later!
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Keisha Taylor
From my experience with NYS DOL, you typically report your NET income (gross minus legitimate business expenses) on the weekly claim form rather than listing expenses separately. So if you made $300 from a freelance project but had $50 in business expenses that week, you'd report $250. Just make sure to keep detailed records of all your expenses with receipts in case they ask for documentation. The software subscriptions you mentioned would likely qualify as deductible business expenses since they're directly related to your design work. I'd recommend calling the DOL customer service line to confirm the specific process for your situation though, since getting it right from the start will save you headaches later.
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Max Reyes
Great question about the business expenses! From my experience with NYS DOL, you typically just subtract your legitimate business expenses from your gross income before reporting the net amount on your weekly claim. So if you earned $300 but had $50 in software subscriptions and supplies, you'd report $250. There isn't usually a separate section for itemizing expenses on the weekly claim form itself. However, I'd strongly recommend keeping detailed records of all your expenses with receipts/documentation since they could ask for proof during an audit. You might also want to call the NYS DOL helpline to confirm exactly how they want business expenses handled for your specific type of freelance work - different types of self-employment might have slightly different rules.
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