Freelance Consultant's Diary

Just as a background, because I am a self employed worker and eligible to receive pandemic unemployment assistance under the CARES Act , I applied for it as soon as MASS opened its new website.  And while the process and document requirements vary by state for Massachusetts no paperwork was needed if you had already filed your 2019 taxes.  As I reported earlier the initial approval in form of a Notice of Monetary Determination came in 2 days.  Another two more days, I see today that the payment is in progress.  Since I have provided by direct deposit information the payment should be faster, though, I found out that the first payment can take somewhat longer because they have to confirm the account information with the bank. I will provide an update when the payment hits my account.  I must say that this has been moving a lot faster than I expected.

I must admit that while I am so proud to be a resident of Commonwealth of Massachusetts.  Today, I am even prouder than ever.  I applied for pandemic unemployment assistance on April 22 around noon and just about 48 hours later, my application has been processed.  As they indicated, I am going to receive the minimum amount of $267 (and the $600 FPUC) to start, but they will then verify my income with the Department of Revenue and will adjust the weekly amount later.  I have no idea how much that will be since this is the first time I have applied for UI and am still learning its ins and outs.  Maybe it will always be the minimum since I am a self employed worker rather than a regular worker and am being paid what the CARES Act allows. So, thanks to all the great people who work at the Massachusetts Department of Unemployment Assistance for such a quick turnaround, especially in the middle of a pandemic.  Couldn't be more pleased, and it almost looks like I might get the funds fr

Here is a little background of my journey.  On March 31st, I applied for $10,000 EIDL from SBA .  I was then very disappointed to learn that while giant corporations were getting multi-billion dollar bailouts, the EIDL amount was lowered to just $1,000 .  To make things worse, I heard that SBA ran out of funding for EIDL . Well, there is some good news.  On April 21, I received the thousand bucks after accepting that money had run out -- it seems that since I was in the line early on, it just took time for them to process the payment.  Interestingly enough, I did not get an email at all; I guess I will just get tax documents later on.

As you know after CARES Act provided for unemployment insurance for gig economy workers, freelancers, and contractors like me, I was eagerly looking forward to learning more and trying to figure out the documents required to file for unemployment benefits . Well, this morning the Commonwealth of Massachusetts started to accept applications for pandemic unemployment assistance for self employed workers in the state, and I applied promptly.  This was the first time I have applied for unemployment insurance in my life -- I am in my 50s.  So, it was a bit scary to do not knowing what to expect. To my pleasant surprise, especially after reading about how other states in the country are struggling to implement this program in a time of great need, the process couldn't be easier.  It is the standard information that is required.  The only thing that is a little complicated for us is the income. It is very important that you file your 2019 taxes even though the deadline to do so is

As a self-employed freelancer I was eligible to receive some benefits under the CARES Act.  So I applied for a $10,000 EIDL advance on March 30th and then for the Paycheck Protection Program on April 13. Well, I heard from SBA after two weeks of silence that they were lowering the amount to just $1,000 but so far I have not received a penny. I also learned that by April 15, SBA had run out of money for the PPP too.  Lendio told me that I was way back in the line. It appears to be that I will not receive any funds at all unless Congress releases more.  Very disappointing, indeed.

Well, when I did not receive my $2,400 stimulus check payment in my bank, I went to check the status on the IRS website, and I was told that the Agency did not have my bank information.  If you are one of those people, here is my situation and may be it is not as uncommon as it seems: I filed both 2018 and 2019 taxes using TurboTax .  Because I am a self-employed contractor and pay estimated taxes as recommended by IRS , in some years, I actually owe money, and 2019 was one such year.  However, because I had followed IRS guidelines on estimated taxes, I did not have a penalty; I just needed to make the payment when due. However, when IRS delayed the deadline to July 15, I simply called the IRS to cancel the payment scheduled through TurboTax.  Does it mean that IRS also deleted my bank account info?  Maybe. In addition, this year I received the 4883C letter to confirm my identity, which I did promptly, but I was also told that it may take 9 weeks or so for the return to be processe

As I have been writing, gig economy, self employed workers, freelancers, and contractors like me are eligible to receive some form of unemployment benefits in the CARES Act to help them during the coronavirus pandemic. I wanted to find out how much money will I receive and what information will I need to provide.  Obviously, I am interested in requirements for Massachusetts, but the State is working with a vendor to design a totally new application system and that would not be ready till April 30, 2020, so it is impossible to know. However, I decided to investigate if I could learn anything from what other states are requiring of us.  Without getting bogged down with details by state (and to be honest, I could not research each state to the same level of detail but some of them require me to sign up and disclose that I live in that state), my conclusion is that you will obviously need the usual details (Social Security number, address, bank information, contact information, citize

Like millions of Americans, Equifax, the credit bureau, let hackers steal my information.  In the settlement, we were told that we will get $125, but since so many people were impacted, that I was told that I may not get any money at all or get only pennies.  The company also said that if I wanted to keep claiming the damage, I needed to provide evidence that I had signed up for a credit monitoring service (they would not accept those of us who have frozen our credit accounts permanently).  So, I ended up signing for their credit monitoring service. Well, the Small Business Administration has pulled a fast one similar to Equifax.  While self employed Americans like me were initially promised $10,000 emergency advances under the CARES Act , now we are being told that the amount will be just $1,000 per employee (meaning for people like me with no permanent employees, that is all I might get).  Also, instead of the usual 3 days, now there is no promise except that it will be "days.

I can tell you that being a freelance consultant is not a bed of roses , but neither is the other option of working for an employer, getting laid off, seeking work again, and living through ups and downs.  In fact, there are some big downsides to working for yourself: you have no help at all if clients do not hire you for no fault of yours (similar to a layoff in some ways, though, I appreciate the fact that CARES Act does offer some unemployment insurance but only during the 2020 pandemic ).  You also have find your health insurance. However, when I see my friends in jobs working very hard but no job guarantee, I find that they are no different than me.  In fact, if I do not have work, I do not have to pretend to be busy or go to work; I can simply sleep all day if I want or mow my lawn but in most cases I spend that time doing some sales and marketing . I am hoping that at the end of the 2020 pandemic, companies will realize that they really don't need people to come in to wo

With the American economy completely ruined with tens of millions of jobs wiped out, my analysis shows that it will take a long time before jobs return.  Past recessions show that it can easily take a several years before a full recovery is achieved.  In the process, some jobs are eliminated forever, while others change .  Plus, some people are never able to find jobs again because they were out of work for too long or their skills became obsolete.  In other cases, companies are able to find cheaper/younger workers and get rid of their older workers. That is my story too.  After September 11 attacks, while it took some time since I was in the middle of working on long-term projects, I was eventually laid off.  I looked for jobs but for reasons stated above, they preferred someone who was a lot cheaper than me. It so turned out that my wife was making money running websites .  This was still the early days of the Internet and not knowing what the result would be, I too started to lau

As a self-employed contractor who has suffered from the coronavirus pandemic, I have been researching all the government programs that came out of the CARES Act 2020.  While this is not meant to be tax advice and your situation could be different than mine, here are some things that may be helpful as you plan your cash flow and tax obligations. Tax deadlines postponed Your taxes for 2019 are due on July 15, 2020 rather than April 15, 2020.  If you are expecting a refund, obviously, you should file as soon as possible so that you can get your refund.  However, if you owe money to the IRS, then, you will have time until July 15. What to do if you have already filed your taxes before the new deadlines were announced?  Good question, because that is what happened to me.  I filed my taxes using TurboTax in February and instructed the IRS to deduct my due amount on April 15 but learned from my research that TurboTax or any other software that you used will not allow you to go in and si

As a self-employed American I am eligible for the so-called The Economic Injury Disaster Loan (EIDL) being given as part of the CARES Act.  Congress designed this program for smaller businesses (fewer than 500 employees but self-employed workers, contractors, gig economy workers, etc. are eligible too). It’s an expansion of the Small Business Administration’s existing disaster loan programs. Since I am a one-man operation I am eligible to request an emergency advance of up to $10,000 that does not have to be repaid.  Obviously, I can borrow more (up to $25,000 without collateral) and up to $2 million with collateral.  For the $10K, though, they will simply check your credit score and will not ask for a tax return. I applied this loan March 31, 2020 and at the time of this blog post, there has been no update at all even though SBA is supposed to get you the $10,000 in three days.  I totally understand how busy they must be and possibly understaffed, so plan accordingly. I also ha

I am an independent consultant who in many ways is no different than other gig economy workers like those who work for Instacart, Shipt, etc.  Because my wife and I are both self employed and work from home, we cook most of our meals, and because it allows us a chance to get out of the house, we love to go grocery shopping.  That is why we never signed up for these services. With the shelter-in-place and social distancing measures put in place in the state of Massachusetts, as a couple in their 50s (though with no pre-existing conditions), we have been trying our best to avoid getting infected.  During the early stages of the pandemic, we noticed that stores were crowded and many people simply did not follow the social distancing guidelines. That is when we decided to explore the idea of using Instacart, and immediately, the ethical dilemma came.  This decision was to be taken right after we and others in our family decided to contribute a small amount each month to so that anothe

I don't know if I should be thinking and saying this, but it seems that as awful as Coronavirus has been for everyone, including myself (with the business wiped out for the time being and no clue about what the future holds), I am glad that at least the politicians realized that those of us who might be known as self-employed, gig economy workers, contractors, 1099-ers, etc. (including those of us who work for Uber, Lyft, DoorDash, GrubHub, Instacart) may be able to receive unemployment insurance to pay our bills. Under the provision of the so-called The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), unemployment benefits are available to us.  The Act also extends the number of available weeks of benefits for all claimants, and supplements all claimants’ weekly benefit amount by $600. How will it work? Since I have never received these payments in the past, I decided to find out, and here is what I learned: Because it has never been done before, the states