During a recent “Common Ground” show on KHTS, Matt Denny of Denny & Company, LLP first addressed a question about application requirements from Host Jason Downs.
“One of the questions that I personally came across (was) … will they accept 2018 IRS returns, or does it have to be 2019?” Downs said. “I was told that it didn’t matter, and then when I went on there and actually started to fill out the application, it said, ‘List anyone that you’ve worked for from Jan. 1, 2019 until now,’ basically.”
After Denny responded that he hadn’t heard actual tax returns were required, Downs clarified that though it seemed the physical returns were not necessary, only work from 2019-2020 appeared to qualify for consideration on the application.
“You would have W-2s for any quote-unquote jobs that you did last year,” Denny responded. “If you had 1099s, I don’t believe they’re requiring you to list who your clients were during that period, so if you worked for Uber … then you wouldn’t list Uber, you would just say that you’re self-employed as a driver.”
Including self-employed individuals for the first time due to the circumstances of the coronavirus pandemic could be a reason why the number of unemployment applications has skyrocketed recently, according to Denny.
“I haven’t seen any statistics … on how many folks out of all of these millions of people who are filing are self-employed, who wouldn’t have filed during the recession because they weren’t allowed to file,” Denny said. “This is new territory for us.”
Denny continued that being self-employed does not necessarily mean a person should qualify for unemployment benefits, which could result in many applications potentially being denied.
In addition, the more applications that are filed unnecessarily, the greater the chance that the entire process will be slowed down for everyone because of the high volume of applications that need to be processed.
“I think they’re having enough trouble just trying to fund unemployment benefits,” he said. “I know one person who applied three or four weeks ago who hasn’t even heard back yet, so I don’t know; they’re just overwhelmed.”
If a person is self-employed but still in business like he is, Denny mentioned a connection between morals and making the decision to file for unemployment.
“Just because you’re self-employed doesn’t mean you necessarily should qualify, so there’s a certain amount of moral hazard, as they say, in these programs,” he said. “It will be interesting to see how it all shakes out in the end.”
The Santa Clarita CPA firm Denny & Company, LLP was established in 1984, and is a full-service firm of Certified Public Accountants in Santa Clarita, including Partners Matt Denny and Carolyn Denny. The Santa Clarita accountants work with small businesses and individuals, specializing in catering to each client’s unique needs and desires using a flexible approach. As a CPA in Santa Clarita, Matt Denny shares his knowledge and experience regularly on “Common Ground” on KHTS Radio. Those looking for the best CPA in Santa Clarita or a “CPA near me” can contact Denny & Company, LLP for more information today.
23929 Valencia Blvd. Suite 304
Valencia, CA 91355