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Q: Collecting unemployment and applying tax ID & LLC ( Answered 4 out of 5 stars,   0 Comments )
Subject: Collecting unemployment and applying tax ID & LLC
Category: Business and Money > Small Businesses
Asked by: martyweiss-ga
List Price: $5.00
Posted: 18 Jun 2002 15:02 PDT
Expires: 25 Jun 2002 15:02 PDT
Question ID: 28688
I am currently collecting unemployment as I was laid off -- can I
continue to collect, AND submit for a Tax ID and incorporate (LLC) my
own business. I will not be making any money right now, but want to
start preparing, yet don't want to lose out on unemployment.

Request for Question Clarification by missy-ga on 18 Jun 2002 15:04 PDT
Unemployment regulations vary from state to state.  Where are you located, please?

Clarification of Question by martyweiss-ga on 18 Jun 2002 16:22 PDT
I am located in Connecticut, and plan on establishing my LLC in Connecticut also.
Subject: Re: Collecting unemployment and applying tax ID & LLC
Answered By: weisstho-ga on 18 Jun 2002 18:06 PDT
Rated:4 out of 5 stars
Hi Marty!

Thank you for your question – sorry that you lost your job, but it
appears that you have some very interesting prospects.
I have reviewed the Connecticut Department of Labor site and specifically that part relating to
unemployment benefits and policies: .
The basic eligibility requirements to qualify for unemployment include
that a benefits recipient “be available for full time work . . . be
actively seeking work by making reasonable efforts to find employment
each week.”  A person may work part-time though their benefits will be
reduced “by an amount equal to two-thirds (2/3) of your gross wages
for that week, rounded to the nearest dollar.”
The weekly requirement is even more carefully laid out:  “You must be
physically and mentally able to work during each week for which you
claim benefits. You must be available for full-time work during each
week for which you are claiming benefits. This means that you must be
ready, willing, and able to accept any suitable work. You must make
reasonable efforts to find employment each week. You may be excused
from this requirement if you are participating in approved job
training. If you are enrolled in the worker profiling and reemployment
services program, you must fully participate in all assessment
interviews, orientation, and referred reemployment services. Finally,
you must file your weekly claims for benefits on a timely basis. For
the majority of individuals, the weekly filing of claims for benefits
is done via a Voice Response Unit.”
Phone inquiries are invited by the Connecticut Department of Labor’s
Legal Staff. You can call them at (860) 263-6755.


My opinion would be that the act of forming a company (and filing for
an EIN with the IRS), be it a sole proprietorship, limited liability
company, or corporation, does not in and of itself constitute any
employment – the formation of the entity is merely an administrative
act with the state (and with the Feds for the EIN). Certainly an
eligible recipient of unemployment benefits could easily form an
entity and “make reasonable efforts to find employment each week.”  I
believe that the two are mutually exclusive; one has nothing to do
with the other.

Once business is generated into your new entity, I would suggest that
you could remain eligible for some unemployment based upon the
part-time employment provision discussed above.

The safest treatment of this issue would be to call the legal staff of
the Labor Department at the (860) 263-6755 number and ask them the

Best of luck in your new venture!
Weisstho-ga (no relation!)

Search terms used:
martyweiss-ga rated this answer:4 out of 5 stars
This was a very good response. The researcher provided important
information, and then an interpertation. Alhtough I had read the
information previously in my unemployment guide, I am glad to have
received this person's opinion, and it probably makes most sense to
call the number provided by the researcher. Thank you for an excellent

There are no comments at this time.

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