Can I collect Washington ESD unemployment while starting my own business - need guidance
I'm currently receiving unemployment benefits from Washington ESD and have been thinking about starting a small consulting business. I'm worried about how this might affect my UI benefits. Do I need to report business income immediately or only when I actually make money? What about the time I spend setting up the business - does that count against the job search requirements? I don't want to mess up my claim but I also don't want to miss this opportunity. Has anyone dealt with this situation before?
48 comments


Sean Fitzgerald
You definitely need to be careful here. Washington ESD requires you to report any work activity, including self-employment. When you file your weekly claim, there's a question about whether you worked or earned money. Setting up a business could be considered work even if you haven't made money yet.
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Anastasia Kuznetsov
•So even just registering the business name would count as work? That seems like it would disqualify almost anyone trying to be proactive about their career.
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Sean Fitzgerald
•It's more about the time and effort you put into it. If you're spending significant hours developing the business, that could affect your availability for work, which is a requirement for UI benefits.
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Zara Khan
I tried calling Washington ESD about this exact question last month and couldn't get through after hours of trying. The phone system is absolutely broken. Has anyone found a way to actually talk to someone there?
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MoonlightSonata
•ugh same here, spent 3 days calling and either got busy signals or hung up on after waiting for 2+ hours
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Mateo Gonzalez
•I actually found this service called Claimyr that helped me get through to an ESD agent. They have a website at claimyr.com and there's a demo video at https://youtu.be/7DieNd3C7zQ showing how it works. Basically they handle the calling for you and connect you when an agent picks up. I was skeptical at first but it actually worked.
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Zara Khan
•Really? How much does something like that cost? At this point I'm desperate enough to try anything.
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Mateo Gonzalez
•The value is definitely there when you consider how much time you save. I spent weeks trying to call on my own with no luck, then got connected within a day using their service.
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Nia Williams
From what I understand, you can start a business while on unemployment but you have to remain available for full-time work. The tricky part is proving you're still actively looking for employment and not just focused on your business.
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Anastasia Kuznetsov
•That makes sense. So I'd still need to do my job searches and be ready to take a job if offered, even while working on the business idea?
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Nia Williams
•Exactly. And you'd need to report any income from the business on your weekly claims. Washington ESD will reduce your benefits based on earnings.
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Luca Ricci
•Wait, doesn't Washington have some kind of self-employment assistance program? I thought I read something about that somewhere.
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Sean Fitzgerald
Yes, Washington does have a Self-Employment Assistance (SEA) program! It's designed exactly for people in your situation. You can receive unemployment benefits while starting a business, but you have to be accepted into the program first. There are limited spots available each year.
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Anastasia Kuznetsov
•This sounds perfect! How do I apply for the SEA program? Is there a deadline or specific requirements?
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Sean Fitzgerald
•You need to have a viable business plan and meet certain criteria. I'd recommend contacting WorkSource to get more details about the application process. The program is competitive though.
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Aisha Mohammed
•I applied for SEA last year but didn't get in. The business plan requirements are pretty extensive and they only accept a small number of people. Still worth trying though!
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MoonlightSonata
honestly the whole system is so confusing, I can never figure out what I'm supposed to report and when. Every time I think I understand the rules something else comes up that doesn't fit
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Ethan Campbell
•I feel you on this. The Washington ESD website has so much information but it's not organized in a way that makes sense for real-world situations.
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MoonlightSonata
•exactly! like they assume you already know all the terminology and procedures but most of us are figuring this out as we go
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Zara Khan
UPDATE: I used that Claimyr service someone mentioned and finally got through to an ESD agent today. They confirmed that starting a business while on UI is possible but you absolutely must report it properly. The agent said many people get in trouble by not reporting business activities thinking they don't count as 'work' until money comes in.
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Anastasia Kuznetsov
•That's really helpful! Did they give you specific guidance about what activities need to be reported?
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Zara Khan
•They said if you're spending time that would otherwise be available for job searching or employment, it needs to be reported. So market research, business planning, networking for the business - all of that counts.
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Yuki Watanabe
•Thanks for sharing what you learned! This is exactly the kind of clarification I needed too.
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Carmen Sanchez
I started my freelance writing business while collecting unemployment in 2023. The key is being completely transparent with ESD. I reported every hour I worked on business development and any income immediately. My benefits were reduced some weeks but I never had any issues with overpayments or penalties.
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Anastasia Kuznetsov
•How did you track the hours? Did you keep detailed records or just estimate?
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Carmen Sanchez
•I kept a daily log of all business-related activities with specific hours. When I filed my weekly claims, I could give exact numbers. Better to be overly detailed than to risk getting audited later.
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Andre Dupont
•This is smart advice. Documentation is everything when dealing with unemployment claims.
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Zoe Papadakis
Just want to add that if you're not accepted into the SEA program, you can still start a business but you have to be really careful about the 'able and available' requirement. ESD can question whether you're truly available for work if you're putting significant effort into a business.
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Anastasia Kuznetsov
•That's a good point. I guess the timing matters - like I shouldn't schedule business meetings during normal work hours when I should be available for interviews?
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Zoe Papadakis
•Exactly. You need to show that employment would take priority over business activities if a job opportunity came up.
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ThunderBolt7
whatever you do, don't try to hide the business from ESD. they have ways of finding out and the penalties for not reporting are severe. overpayment demands, disqualification, even fraud charges in some cases
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Jamal Edwards
•How would they find out though? I'm not trying to hide anything but I'm curious about their enforcement methods.
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ThunderBolt7
•business licenses are public record, they cross-reference tax filings, and they do random audits. plus people sometimes report each other out of spite. not worth the risk
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Anastasia Kuznetsov
•Definitely not planning to hide anything! I want to do this the right way, which is why I'm asking all these questions upfront.
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Mei Chen
The WorkSource offices can be really helpful for this kind of guidance too. They have business counselors who understand both the unemployment rules and entrepreneurship. Might be worth scheduling an appointment before you make any decisions.
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Anastasia Kuznetsov
•Good suggestion! I'll look into setting up an appointment. Do they offer virtual meetings or is it all in-person?
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Mei Chen
•Both options are available depending on your local office. The business counselors are usually pretty knowledgeable about how entrepreneurship affects UI benefits.
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Liam O'Sullivan
I went through this whole process two years ago. The most important thing is to get clear guidance from ESD before you start anything. Don't rely on what you read online or what friends tell you - the rules can be complex and vary by situation.
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Anastasia Kuznetsov
•That's exactly why I posted here first. I wanted to understand the basics before I try to contact ESD directly.
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Liam O'Sullivan
•Smart approach. Having a good understanding of the issues will help you ask better questions when you do talk to an agent.
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Amara Okonkwo
•And if you can't get through by phone, definitely consider using that Claimyr service. I've heard good things about it from several people now.
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Giovanni Marino
One thing people don't always think about is how business expenses work with unemployment. You can deduct legitimate business expenses from your reported income, which might help reduce the impact on your benefits.
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Anastasia Kuznetsov
•Interesting! So if I spend money on business registration, supplies, etc., that reduces the 'profit' I have to report?
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Giovanni Marino
•Yes, but you need to keep detailed records and receipts. ESD will want documentation if they audit your claim.
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Fatima Al-Sayed
Bottom line: it's definitely possible to start a business while collecting unemployment in Washington, but you need to do it right. Get proper guidance, keep detailed records, report everything honestly, and consider applying for the SEA program if you qualify. Don't let fear stop you from pursuing your business idea, just be smart about it.
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Anastasia Kuznetsov
•Thank you everyone for all the helpful advice! I feel much more confident about moving forward now. I'll start by contacting WorkSource and looking into the SEA program.
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Dylan Hughes
•Good luck with your business! Washington needs more entrepreneurs.
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NightOwl42
•Keep us updated on how it goes! This thread has been really informative.
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