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Tristan Carpenter

Can you make money while on unemployment benefits in NY - what are the limits?

I've been collecting unemployment for about 6 weeks now and I'm getting some freelance web design work offered to me. I want to take it but I'm terrified of messing up my benefits. Can I make money while on unemployment in NY? What happens if I earn too much in a week? Do I have to report every dollar? I've heard conflicting things about whether part-time work gets you kicked off completely or if they just reduce your weekly benefit amount. My weekly benefit is $465 and this freelance gig would probably pay around $300-400 per week. Should I even risk it or just wait until my benefits run out?

You can definitely work part-time while collecting unemployment in NY, but you MUST report all earnings when you file your weekly claim. NYS Department of Labor has specific rules - they'll reduce your benefit by 25% of whatever you earn over $143 per week. So if you earn $300, they'll subtract 25% of $157 ($300-$143=$157), which is about $39 from your weekly benefit. You'll still get most of your unemployment plus your work income.

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Wait so I can keep both incomes? That's actually better than I thought! Do I report gross or net income from the freelance work?

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just be super careful about reporting everything correctly. i made the mistake of not reporting some cash work i did and got hit with an overpayment notice months later. they wanted me to pay back like $2000 plus penalties. not worth the risk

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Yikes! Did you end up having to pay it all back? That's exactly what I'm worried about.

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yeah i had to pay it back but they let me set up a payment plan. took forever to resolve though

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The key thing is understanding the partial unemployment rules. You report GROSS earnings (before taxes) for any work done during the week you're claiming. NYS Department of Labor calculates it as: if you earn more than $143 in a week, they reduce your benefit by 25% of the amount over $143. If you earn more than your weekly benefit rate plus $143, you get no unemployment that week but your claim stays active.

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This is so confusing! So if my benefit is $400 and I earn $600 in a week, I get nothing that week but I can still claim the next week if I earn less?

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Exactly! Your claim doesn't close just because you had one high-earning week. You just don't get unemployment for that specific week.

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I've been trying to call NYS Department of Labor for weeks to ask about this exact situation but their phone lines are impossible. Every time I call I either get a busy signal or get disconnected after waiting on hold for 2+ hours. How is anyone supposed to get clarification on these rules? The website isn't clear about freelance work specifically.

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I had the same problem until someone told me about Claimyr. It's a service that calls NYS Department of Labor for you and gets you connected to an actual agent. I used it last month at claimyr.com and got through in like 20 minutes instead of hours. There's a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Totally worth it when you need real answers about your specific situation.

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ugh the whole system is such a nightmare. why make it so complicated? i had a similar situation with uber driving and it took months to sort out because i reported it wrong the first few times. they really need to make this clearer

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What ended up happening with your Uber situation? Did they make you pay anything back?

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Just to be extra clear since there's been some confusion in this thread - for freelance work you report the gross amount you earned during the week you're filing for, NOT when you get paid. So if you do $400 worth of work this week but don't get paid until next month, you still report that $400 this week. And yes, always report gross income before any taxes or deductions.

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Thanks everyone for the detailed responses! This is really helpful. I think I understand the basics now - report gross income, they reduce benefits by 25% of anything over $143, and my claim stays active even if I earn too much one week. One more question though - since this is freelance web design work, how do I handle it if the client pays me with a 1099 at the end of the year instead of weekly? Do I still report it the week I do the work even though I haven't actually received payment yet? And should I be setting aside money for taxes on both the freelance income AND the unemployment benefits?

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One thing to add about freelance work while on unemployment - make sure you understand the difference between "work" and "earnings" when reporting. Even if you spend 10 hours working on a project but haven't finished it yet (so no payment earned), you still need to report those work hours on your weekly claim. NYS Department of Labor looks at both the amount you earned AND the number of days you worked. If you work 4 or more days in a week, even for just a few hours each day, it can affect your benefits differently than just the earnings calculation. I learned this the hard way when I was doing small freelance projects - I was only reporting the money but not the actual work days, which caused issues later when they audited my claim.

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Wait, this is really important information that I haven't seen mentioned anywhere else! So even if I'm just working on a project but haven't earned any money yet that week, I still need to report the work days? This seems like something that could easily trip people up. Do you know if there's a specific threshold for hours per day that counts as a "work day"? I'm worried I might have already messed this up in my previous claims since I've been doing some preliminary design work that I haven't invoiced for yet.

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@QuantumQuasar you're right to be concerned about this! The "work day" reporting is super tricky and not well explained. From what I understand, any day you perform work that will eventually result in income counts as a work day, even if it's just an hour. So if you spent Monday morning sketching concepts and Tuesday afternoon coding, that's 2 work days even if you haven't invoiced yet. The key is being consistent going forward - definitely report any future work days accurately. For the past claims where you might have missed this, you could contact NYS DOL to clarify, but honestly their phone system is such a nightmare that it might not be worth the stress unless they specifically audit your claim. Just make sure you're reporting everything correctly from now on!

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@QuantumQuasar You're right to be concerned about this! From what I understand, any work you do - even preparatory work like design mockups or client consultations - counts as work activity that needs to be reported. NYS DOL doesn't have a specific hourly threshold published, but generally if you do any work-related activity on a given day, that counts as a work day. The key is being transparent about ALL work activity, not just completed paid work. If you're worried about past claims, you might want to contact them proactively to clarify rather than wait for an audit. Better to address it upfront than get hit with an overpayment later like @Grant Vikers mentioned.

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@QuantumQuasar You're right to be concerned about this! From what I understand, NY doesn't have a specific hour threshold - any day you do work for pay (even just an hour) counts as a work day. The key question on the weekly claim asks "Did you work or earn money?" So even unpaid prep work for a freelance project could technically count. I'd suggest calling the unemployment office to clarify your specific situation, especially if you've already filed claims without reporting work days. It's better to get ahead of this now than deal with an overpayment notice later. @Camila Jordan - thanks for bringing this up, this is exactly the kind of detail that trips people up!

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@QuantumQuasar You're right to be concerned about this! From what I understand, NYS considers any day where you perform work (regardless of hours) as a work day that needs to be reported. There isn't really a specific hourly threshold - even a couple hours of freelance work technically counts as working that day. The good news is that if you realize you made mistakes on previous claims, you can contact NYS DOL to correct them voluntarily before they find the discrepancies during an audit. It's much better to self-report errors than to have them discover it later. @Camila Jordan - thanks for bringing this up, I had no idea about the work days vs earnings distinction!

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@QuantumQuasar You're right to be concerned about this! From what I understand, any day where you perform work activities - even unpaid preparation, client meetings, or working on deliverables - should be reported as a work day. There isn't a specific hour threshold that I'm aware of, but the key is that you did work-related activities on that day. I'd strongly recommend calling the Department of Labor (or using that Claimyr service @Libby Hassan mentioned to) clarify your specific situation and potentially correct any previous claims if needed. It s'better to proactively address this than wait for them to catch it during an audit. The good news is that if you self-report the correction, they re'usually more lenient than if they discover unreported work days on their own.

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@QuantumQuasar You should definitely look into this ASAP! From what I understand, any day you perform work activities - even unpaid prep work - can count as a work day. I think it's based on whether you did any work-related activities that day, not a specific hour threshold. You might want to contact NYS Department of Labor directly to clarify your situation and potentially amend any previous claims where you didn't report work days. It's better to be proactive about this than wait for them to discover it during an audit. @Camila Jordan - do you know if there s'a way to correct previous weekly claims if someone realizes they under-reported work days?

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@QuantumQuasar You're right to be concerned about this! From what I understand, any day where you do any work at all (even just an hour) counts as a "work day" that needs to be reported. There isn't really a minimum hour threshold - if you worked, you worked. The key is being completely transparent with NYS DOL. If you think you might have under-reported work days in previous claims, I'd honestly recommend calling them (or using that Claimyr service someone mentioned) to ask about how to correct it. It's much better to be proactive about fixing mistakes than to have them discover it later during an audit. They're usually more lenient if you come forward voluntarily rather than them finding discrepancies on their own.

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@QuantumQuasar You should definitely look into this ASAP! From what I understand, any day you do ANY work (even 1 hour) counts as a work day that needs to be reported. The NYS Department of Labor website mentions this under their "partial unemployment" section, but it's buried in the details. I'd strongly recommend calling them directly or using that Claimyr service someone mentioned earlier to get clarification on your specific situation. If you've been doing unpaid prep work and not reporting those days, you might want to get ahead of it before they potentially audit your claim. Better to be proactive than deal with an overpayment notice later!

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@QuantumQuasar You should definitely contact NYS Department of Labor ASAP to clarify your previous claims if you think you might have under-reported work days. From what I understand, any day you do work related to earning income counts as a work day, regardless of hours - even if it's just 30 minutes. The key is that you're performing services that will eventually result in payment. For freelance work, this can include planning, designing, client meetings, etc. I'd recommend calling them directly or using that Claimyr service @Libby Hassan mentioned to get proper guidance on how to handle any corrections needed. It s'better to proactively address this than wait for them to catch it during an audit.

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