Definitions

• Each state determines who is eligible for unemployment benefits, how to file, how long benefits last and how much income a recipient can earn while receiving benefits. States have differing formulas for determining what constitutes "part-time" work. Some states have established numbers of hours worked to qualify (for example, less than 35). Other states use a percentage-based methodology, such as reducing your unemployment benefits directly or proportionally to the amount of money you earn each week. Eligibility requirements regarding searching for work also vary among states, as do guidelines for self-employed people. North Carolina, for example, requires that you inform the state if you receive any job offers, reasons why you didn't accept an offer, and to adhere to a weekly job-search plan.
  
  

Formulas

• Working part time in most states won't disqualify you from receiving unemployment benefits, but probably will reduce your benefit amount. Some states are more generous with their formulas than others, allowing you to work and earn more money than other states before having your benefits reduced. North Carolina's formula, for example, is EA = HQW ÷ 13 x 0.10. This translates into your earned allowance (EA) equaling the amount of your high-quarter wages (HQW) for the previous year ($4,000, for example) divided by 13 and multiplied by 10 percent (0.10). So, $4,000 ÷ 13 = $307.62; $307.62 x 0.10 = $30.76. The weekly amount you can earn before the state begins reducing your benefits is $36 (rounded to the lowest full dollar). After earning $36, your benefits in North Carolina are reduced on a dollar-for-dollar basis. Other states use different formulas.
  
  

State Examples

• In Texas, the earnings allowance is 125 percent of your weekly benefit amount. If you earn less than your allowance limit, the state pays you the difference between the two figures. This means that you can receive 25 percent more income by working part time (and receiving partial benefits) than by receiving only unemployment benefits, and your benefits probably will last longer. Delaware's earnings allowance is even more generous. You can earn half of your weekly unemployment benefit amount without being penalized. For instance, if your benefit is $100 a week, you can earn an additional $50 each week before your benefit is reduced. Each additional dollar over $50 is deducted from your $100 benefit amount. If you earned $60 in a week, your benefit total would be $90. Both Texas' and Delaware's programs are designed to encourage people to get back into the workforce without unduly penalizing their efforts.
  
  

Reporting

• All states have strict policies regarding reporting earned income. Most require that you include any earnings on your weekly claim form, even if the amount earned doesn't impact your benefit total. Reported income must be gross, and not net, income --- in other words, the amount you earned before taxes and other deductions. By not reporting income, you run the risk of losing some benefits, all benefits, becoming ineligible for future benefits or even being prosecuted. Texas treats such incidents as fraud, a Class A misdemeanor, and prosecutes for repayment of benefits received. You'll also lose any remaining benefits and could have liens placed on your property and face jail time.