By Nov. 2009 I was in appeal forUE benefits for 10 months from a previous NJ employer. I held 2 other jobs for W-2 part time employment and accepted a third job to make ends meet at that time ,but the chiropractor (most recent job)"can't afford" payroll taxes so I am on a 1099. I KNOW I do not qualify as independent contractor, he supplies work zone, materials, patients. In January I had reached accumulation of "6 x weekly rate per UE" so I was suddenly awarded UE part time benefits. I continue to include all of my compensation to UE from 3 jobs but am concerned that there will be a problem with that "contractor "status. I am prepared to pay quarterly estimated tax; the chiro's accountant says to pay it at end of 2010. Do I LEAVE the chiropractor if he continues the 1099 status? I am his top-producing massage therapist. I want NO trouble with UE OR IRS.. I do not mess around with either of them! Help me in NJ!

Unemployment Insurance is funded by payroll taxes paid by employers for W2 employees. Therefore 1099 workers do not qualify.

To expand a little bit - you "know" you don't qualify as a 1099 employee yet you are paid as a 1099 employee. I appreciate that these are difficult financial times BUT the set off for being a 1099 (legal or illegal) is that you cannot collect Unemployment (as well as Workers Comp) benefits because you/your employer do not pay into the "system."

And This is how he most likely pays contract labor in his office, for services like yours it is very common.

You are not an employee as noted and not earning any UE benefits since he pays none in on you.

Don't file quarterly just yet. Wait until end of year to file as you just might not be there too much longer to worry about the 1099 status. Also you could have more legitimate deductions and this would change your entire tax picture. I'd wait.

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Originally Posted by JudyKayTee

To expand a little bit - you "know" you don't qualify as a 1099 employee yet you are paid as a 1099 employee. I appreciate that these are difficult financial times BUT the set off for being a 1099 (legal or illegal) is that you cannot collect Unemployment (as well as Workers Comp) benefits because you/your employer do not pay into the "system."

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But I mentioned that I am well prepared to pay my own taxes, inclusive of UE... either quarterly or which ever way it's legal... and what of the taxes already paid in on W-2 by my other 2 employers for whom I continue to work and who continue to pay into the system... I'm not loooking for anything more than to do this the right way

The W2 income goes in the usual place on the 1040. The 1099 income can be entered on a Schedule C to take advantage of tax breaks there. If you are going to be seriously underpaid, then you do need to file quarterly estimates. Generally you get a pass the first time around, so for 2010, you need to file quarterly estimates.

Thank you, Scottgem.. I appreciate your comments re the IT info and I understand that much, and I am prepared to doit but my real concern is the UE payments which everyone above states I am not entitled to because my new boss doesn't pay in to the system (but my other two do... and I WILL if that were allowed.)So just to avoid any problems, I have an appointment with chiropractor today to tell him he will need to put me on a w2 or I can't work there.. . 1099 is a common practice for employers vs. massage therapists and I have always been able to convince them that they know and I know that mine is not 1099 work for them and they've always given in. I need the additional UE compensation regardless and don't want to jeopardize that status, having waited almost a year for appeals process. Thank you again!

I reread your OP and I'm a little confused here. You said you worked 2 p/t W2 jobs and 1 1099 job. Were you terminated from any of those jobs?

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Originally Posted by ScottGem

I reread your OP and I'm a little confused here. You said you worked 2 p/t W2 jobs and 1 1099 job. Were you terminated from any of those jobs?

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Hi Scottgem,
It IS confusing... last Feb. I left a spa job because of unfair labor practices. I was denied UE because I left on my own.( I appealed the decision, stating that while at the spa I was required to do housekeeping and food services for the past 2 years w/o compensation and was told that I MUST stay after work on Saturdays to clean up; I refused and decided to leave for a better job search.)
At that same time I was employed by a (W-2)Dr. and found another job in June with another(W-2) Dr. soooo. 2 Doctors, part-time.. not enough compensation, so still was looking.

I still had to call UE every 2 weeks while awaiting the appeals decision. That claim was ultimately denied but UE said that if I worked and could earn 6-1/2 times my "weekly benefit rate" I would be eligible for benefits, as stated in the benefits booklet. Reduced benefits started this January, AFTER I took the job with the chiropractor who could not afford the addit'l 11% payroll taxes; I was prepared to pay quarterly taxes. People online here are saying I can't collect. I do report ALL income each week.. I have appt. with chiro to inform him that unless I file a W-4 I will have to continue my search because I am not 1099 status. It just seems the easiest thing to do because I want no problems.. the part-time benefits helped because I was out of (substantial) work for 6 months, seeking a better job. And with everything else, I STILL have 3 part-time jobs, soon to be 2! Can't help that I love my work as a licensed massage therapist!

I don't expect you to reply, Scottgem.. you've been kind enough to listen to this crazy mixed-up situation.Many Thanks!

Ok, now I understand. In actuality, free lance income is not counted towards the amount you made to reduce your UI. However, any days you actually worked reduce the benefit by 1/4. So if you are reporting the days you work, and you work more than 4 days a week, I don't see how you would be eligible for any UI.

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Originally Posted by ScottGem

Ok, now I understand. In actuality, free lance income is not counted towards the amount you made to reduce your UI. However, any days you actually worked reduce the benefit by 1/4. So if you are reporting the days you work, and you work more than 4 days a week, I don't see how you would be eligible for any UI.

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Thanks again, Scottgem! Then so be it! After a year's debate I am weary!