How to Return PUA Benefits as a Self-Employed Individual


Brendan Tuytel


Reviewed by


August 11, 2020

This article is Tax Professional approved


Part of the CARES Act was the implementation of Pandemic Unemployment Assistance—an expansion of state unemployment benefits to cover self-employed individuals who previously would have been ineligible. While this makes it easier than ever to receive these benefits, it’s important to know in what situations you will have to give them up. Here’s what you need to know if you’re receiving PUA as a self-employed individual.

What's Bench?
Online bookkeeping and tax filing powered by real humans.
Learn more
Friends don’t let friends do their own bookkeeping. Share this article.
Tired of doing your own books?
Try Bench

What are the PUA benefits?

The PUA opened up unemployment benefits to cover all self-employed individuals and gig workers. Recipients would have their amount based on their 2019 net income with an additional $600 per week (ending July 31) as support during the pandemic. Additionally, all recipients had their eligible period of coverage extended from 26 weeks in most states to 39 weeks (up to 46 in some states).

When would I have my PUA benefits reassessed?

Every week during your PUA benefits period, you will have to report whether you received any additional income. If you have, your benefits will be reassessed. Self-employed individuals will provide an estimate of hours worked and wages earned for that week.

If you receive a Paycheck Protection Program loan while collecting unemployment benefits, you will have to report the portion you will collect as Owner Compensation Replacement. Since Owner Compensation Replacement covers the income that you would be receiving from the net profits of the business, this will affect your PUA eligibility. For PPP loans received after June 5, your income will be the entirety of your loan amount. You will be able to take that amount as draws over the 24 week period.

How do I report a PPP loan as income?

Every state is different in how it processes and assesses unemployment benefits. If you’ve received a PPP loan, it’s best to reach out proactively to your state’s unemployment office with the following information:

  • Your PPP loan amount
  • The date when the funds were received
  • The payment schedule you’re planning to take the funds as Owner Compensation Replacement (8 weeks vs 24 weeks if before June 5th, 24 weeks if after June 5th)

The best way to report your PPP loan as income is to send an email—that way there’s a paper trail (and it’s often difficult to get a hold of unemployment agencies by phone).

When will I have to return PUA benefits?

If you receive a PPP loan, you will be expected to report that as income on your weekly wages estimate and you may be required to return your benefits for the week the loan was received. If you do not report it as income, your state unemployment office may perform a claim audit. When a claim audit is performed, you will be required to pay back any overpaid benefits in addition to a penalty of a reduction in your benefits payments.

How do I return PUA benefits?

The process will be different state by state. The most common recommendation is to either return any undeposited payments you have received or to send a check or money order to a specific Overpayments Unit in your state. When you do make a return payment, include a statement that covers your name, individual Claimant ID, telephone number, and what benefit weeks you’re wishing to repay. You will only be contacted if there is any follow up required on their end.

Other COVID-19 resources

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. Bench assumes no liability for actions taken in reliance upon the information contained herein.
Friends don’t let friends do their own bookkeeping. Share this article.

Join over 140,000 fellow entrepreneurs who receive expert advice for their small business finances

Get a regular dose of educational guides and resources curated from the experts at Bench to help you confidently make the right decisions to grow your business. No spam. Unsubscribe at any time.