Unemployment Related for Self-employed on EAD

[fira]

if someone opens company on EAD and contracts himself out from his own company. Then suddenly the contract/project with client is finished. And there is no income to the company. So he cannot draw his salary from company account either bcoz of no money in there.

Can he lay off himself? and claim UI?

 

[SWaiting]

fira,
Please avoid these hypothetical scenarios..!!!. This is an immigration forum and not an company law forum.

First off all any S-Corp or C-Corp company, you cant get benefits if you are the officer of the company. When I say officer it means not an employee, but like part owner/director/company secratery (which you have to mention at the time of company forming..)

goodluck

 

[fira]

SWaiting,

As a matter of fact, this is not hypothetical scenrio. This is real sitaution with my husband.

I am primary. First I lost my job. Now my husband got laid off, when he was contracting him out from his own company.

I would like to have some gurus opinion, that's why i posted this question.

Sorry for any inconvenience.

 

[rajum]

I think it depends on state laws and in NJ he cannot claim UI as long as he is the owner/partner of an active company.


-rajum

 

[Gegemon]

I think situation depends on if any sort of business-use assets were involved while self-employed. If any depreciation of a business property (e.g. office space, car, computer, etc.) were claimed on previous tax returns (through IRS form 4562) , you have to dispose of business property by selling it or converting it back to personal-use property in order to exit the business. If no assets were involved - you can probably claim that you are exiting self-employed business any time as long as it stops generating revenue, at least for a given tax year. Then claim your unemployment benefits. I think that you have to be self-employed for at least 6 months and make quarterly estimated tax payments to qualify for unemployment benefits.

You can check with IRS publications on that and can contact Unemployment office for clarification.