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Sebastián Stevens

Can you file for unemployment if you own a business in Washington?

I've been running my small consulting business for the past 2 years but things have really slowed down lately. Like barely any clients for the past 3 months. I'm wondering if I can file for Washington ESD unemployment benefits even though I technically own my business? I've heard mixed things about this and I'm not sure what the rules are. Has anyone been in a similar situation or know how this works?

This is actually more complicated than most people think. If you're self-employed in Washington, you generally can't collect regular UI benefits unless you've been paying into the system as both employer and employee. But there might be exceptions depending on your specific situation.

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I haven't been paying unemployment taxes on myself, just regular business taxes. Does that mean I'm out of luck?

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Not necessarily out of luck, but it makes things more complex. You'd need to look into whether you qualify under any special programs or if your business structure affects eligibility.

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wait i thought business owners couldn't get unemployment at all? this is confusing

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It depends on several factors like how the business is structured, whether you've been paying unemployment taxes, and if you're still actively operating. The rules aren't black and white.

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I went through something similar last year. The key thing Washington ESD looks at is whether you're truly unemployed or just having a slow period in your business. If you're still operating, even minimally, it gets tricky.

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What ended up happening with your situation? Were you able to get benefits?

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I had to prove that I essentially shut down operations temporarily. It took weeks of back and forth with Washington ESD to sort it out.

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You should definitely call Washington ESD directly about this because the rules around self-employment and business ownership are really specific. I tried calling multiple times but kept getting disconnected or put on hold forever. Finally used claimyr.com to get through to an actual agent who could explain my situation properly. There's a video demo at https://youtu.be/7DieNd3C7zQ that shows how it works.

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How long did it take to get through with that service? I've been trying to call for days.

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Got connected within about 10 minutes, which was amazing compared to my previous attempts. They handle the waiting and calling back for you.

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THE WHOLE SYSTEM IS RIGGED AGAINST SMALL BUSINESS OWNERS! They make it impossible to get help when you need it most. I've been paying taxes for years and when my business struggles they just say tough luck.

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i feel you on this, the system definitely seems stacked against us

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I understand the frustration, but there are legitimate reasons for the restrictions. The unemployment system is designed for traditional employer-employee relationships.

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The main factors Washington ESD considers are: 1) Business structure (LLC, Corp, sole prop), 2) Whether you've paid unemployment taxes on your own wages, 3) If you're still operating the business, 4) Your role in the business (owner-operator vs. having employees). Each situation is unique.

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I'm a sole proprietor with no employees. Does that change anything?

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Sole proprietors typically don't pay unemployment taxes on themselves, which makes regular UI benefits unlikely. But there may be other options to explore.

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This is giving me anxiety just reading about it. I'm in a similar boat and was hoping to file soon. Do I need a lawyer for this or something? What if I mess up the application?

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You don't need a lawyer to apply. Just be completely honest about your business situation on the application. Washington ESD will review and contact you if they need clarification.

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But what if they think I'm trying to commit fraud or something? I'm just genuinely struggling.

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Another thing to consider - if you do any contract work or 1099 income while your business is slow, that could affect your eligibility too. You have to report all income sources.

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I do have one small client still paying me about $200/month. Is that going to disqualify me completely?

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Not necessarily disqualify, but you'd need to report it as earnings. It might reduce your weekly benefit amount if you do qualify.

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this whole thread is making me realize how complicated this stuff is. maybe just easier to try to find more clients instead

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That's exactly what they want you to think! Don't give up on benefits you might be entitled to.

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One more important point - if you've been operating as an LLC and paying yourself a W-2 salary (not just distributions), you might have been paying unemployment taxes and could qualify for regular benefits. Check your tax records.

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I'm not an LLC, just sole prop filing Schedule C. Sounds like I'm probably not eligible then.

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Probably not for regular UI, but still worth checking with Washington ESD about any other programs that might apply to your situation.

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Just wanted to add that I know someone who owned a business and was able to get unemployment, but they had to prove they completely ceased operations. Like literally shut everything down, not just had a slow period.

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That makes sense. I'm not ready to completely shut down yet, still hoping things pick up.

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Yeah, if you're still operating even minimally, it's going to be much harder to qualify.

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Seriously though, calling Washington ESD is your best bet for getting a definitive answer. Every business situation is different and they need to review your specific circumstances. The Claimyr service I mentioned earlier really helped me get through when I couldn't reach anyone the regular way.

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Is that service legit? I'm always worried about scams when I'm desperate for help.

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Yeah it's legit, they just help you get through the phone queue. You still talk directly to the Washington ESD agent yourself.

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Bottom line: file an application if you think you might qualify, but be completely honest about your business ownership and operations. Washington ESD will make the determination based on your specific situation. Don't assume you're disqualified without trying.

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That's good advice. I guess the worst they can do is say no, right?

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Exactly. And if they do deny you, you have the right to appeal if you disagree with their decision.

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Just remember that even if you qualify, the weekly benefit amount for business owners is often lower because your reported income might be irregular. Don't expect the same amount as traditional employees.

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I figured as much. Any amount would help at this point though.

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thanks everyone for all the info, this has been really helpful even though it's confusing

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Happy to help. The unemployment system is complex but understanding your options is important.

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One last thought - if you do apply and get approved, make sure you understand the job search requirements. They might be different for business owners who are looking to return to traditional employment vs. trying to restart their business.

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Good point. I hadn't even thought about the job search requirements yet.

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Yeah, you'll need to be actively seeking work and document your job search activities just like any other claimant.

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This whole discussion has been eye-opening. I'm going to gather all my business records and try calling Washington ESD tomorrow to see what my options are.

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Good luck! Having all your documentation ready will definitely help the conversation go smoother.

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Hope everything works out for everyone dealing with slow business. These are tough times for small business owners.

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Thanks, appreciate all the advice from everyone here. At least now I know what questions to ask.

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Final reminder that getting through to Washington ESD by phone can be really challenging during busy periods. If you're having trouble connecting, that Claimyr service at claimyr.com can save you hours of calling and redialing. Worth considering if you need answers quickly.

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I'll definitely keep that in mind if I can't get through the regular way. Thanks for the tip!

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Good discussion everyone. Remember that unemployment laws can change, so always verify current information directly with Washington ESD rather than relying solely on forum advice, no matter how well-intentioned.

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very true, official sources are always best for final answers

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