New rules for claiming Unemployment Benefits

Mike Sylvester • April 2, 2020

This email was added to our Blog on 4/2/2020.  If you did not get the email we sent to all of our clients please send Shane an email at Shane@sbscpagroup.com and ask Shane to please add you to our email blast list that we are using to keep our clients informed about the emergency legislation that Congress has passed.

April 1 st , 2020

This is a very long email and will affect many of our clients.  This email will affect anyone who is filing a claim for unemployment benefits, and please realize a lot more people can qualify for these benefits under the new laws, and the benefits are much larger than they have been in the past.  Please read the email entirely before contacting The Indiana Department of Workforce Development with your questions.  There is a section at the end of this email that summarizes what we think you should do if you think you are eligible for unemployment benefits after reading this email.  We will provide different sources for you to get more information at the end of this email; please realize we put everything we know in this email to assist you, your friends, and your relatives.  Please do NOT contact us with questions about Indiana unemployment claims because this is not something we can help you with.  This new emergency legislation has given us a lot more work to do in other areas, and we need to focus on those other areas.

This is our second email about the emergency legislation:

This email discusses the emergency legislation Congress passed ordering the states to expand unemployment benefits massively.  These benefits will flow to many people who were not previously eligible, and the amounts paid will in many cases exceed the amount of money workers are paid via their regular jobs.

The third email will be sent by Friday and will discuss the large amounts of loans that will be available to small businesses; in some cases, these loans will be forgiven and actually be considered a grant.

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With these new laws Congress is trying to convince businesses to follow one of two paths.  The first path involves encouraging businesses to lay off workers and for those workers to claim enhanced unemployment benefits.  The second path is for the government to offer loans; some of which will be forgiven and function like grants, meaning some of the loans will not have to be paid back and in turn the businesses will keep their employees on payroll.  Some businesses will follow a hybrid path and do some of both.

______________________________________________________________

This email is about the first path and discusses the new unemployment provisions.

The Federal government is pouring hundreds of billions of dollars into the state unemployment systems.  To get this money, each state must adopt various provisions that the federal government is forcing them to make to get all of this money.   We fully expect Indiana to comply with all of these provisions; and we expect most, if not all, other states to do the same.

The goal of this program is to allow more workers to apply for unemployment and for them to get their first unemployment check within three weeks of filing.  Further, the federal government is enhancing these benefits.

The goal of the Indiana Department of Workforce Development is to get the first unemployment check out three weeks after the initial claim for unemployment benefits.  We expect the first check to go out three weeks after you submit your claim if your claim meets the standard rules that have been in place for years.  If your claim involves the new rules, we feel it will take you 3-5 weeks to get your first check because they have to reprogram their software, and they are overwhelmed with phone calls and emails.   Further, they have closed their offices to the public.

The Indiana Department of Workforce Development has not had time to issue their new rules, and they are begging people not to call them with questions about the new rules since they need time to write the new Indiana rules, change their software, and train their staff.

Indiana has adopted some of the new rules listed below already, and we expect them to adopt all of the new regulations by the end of this week.  These rules are:

You are eligible for benefits as of the first day you are laid off.

They have to tell you if your claim is denied through the account you set up online, and you can appeal it.

Currently, you have to file a weekly voucher telling them all the income you earned that week and listing the jobs you applied for.  We expect the job search requirements to be lessened or even eliminated but not the obligation to file the weekly voucher online.

Employers will not be held accountable for employees who are laid off due to COVID-19.  This means all Indiana employers will see their tax rates increase 1/1/21, not just those who lay off employees.  The tax increases will be spread across all businesses.

Right now, Indiana allows 26 weeks of unemployment benefits, and we expect this to be increased to 39 weeks.

Indiana will calculate your benefits per their usual rules, and once your claim is accepted, you will be able to see these amounts in your online account.

If you qualify for Indiana unemployment benefits under the new expanded rules, you will be paid the Indiana amount and another $600 per week provided by the federal government.  The additional $600 payment is for a maximum of four months.  Indiana may send one payment per week or two payments per week; they have not decided yet.

Any worker who has been diagnosed with COVID-19 will qualify if they cannot work.

If you have to care for a family member or a member of your household that has been diagnosed with COVID-19, you also qualify for unemployment.

If you are providing care for a child or other person in your household that you have primary caregiving responsibility for and that individual is unable to attend school or attend another caregiving facility that is closed due to COVID-19 and this causes you to be unable to work you qualify for unemployment.

You are unable to reach work due to a COVID-19 quarantine.

You are unable to work because a health care provider has advised you to self-quarantine due to COVID-19.

Any worker who was furloughed by their employer due to COVID-19 will now qualify regardless of wage history.

Any worker that was laid off due to COVID-19 will also be eligible regardless of their work history.

A worker who was scheduled to commence work and now does not have a job due to COVID-19 or is unable to get to work due to COVID-19 qualifies.

The individual has become the primary breadwinner or significant support for a household because the head of the household has died as a direct result of COVID-19.

The worker has to quit their job as a direct result of COVID-19.

Freelancers, independent contractors, gig workers, and the self-employed, in many cases, can now file for unemployment benefits if they were laid off due to COVID-19.  This is not well defined, and the rules are not clear on this.  The Indiana Department of Workforce Development will issue guidelines on this in the next 7-10 days.

Remember you do not qualify for unemployment if:

You can telework with pay, OR you are receiving sick pay, or other paid leave benefits.

Note that you may qualify for partial benefits if your employer reduces your hours to less than your regular full-time workweek.

According to the FAQs posted on the Indiana Department of Workforce Development (DWD) website, “Indiana Unemployment benefits are available to any individual who is unemployed through no fault of his/her own.  If an employer must lay off employees due to the loss of production caused by the Coronavirus, individuals may be eligible for unemployment benefits if they meet the monetary criteria and the weekly eligibility criteria.  Employees must stay in contact with their employer and be available to work when called back.”

Your application will be a regular application under the standard rules and accepted quicker as long as:

You were laid off for lack of work or due to COVID-19 AND In the last year and a half, you earned $7,000 or more in W-2 wages (This is not the exact rules but gets you in the ballpark).

How do you apply:

You apply online through the DWD website, the required visit to a WorkOne office has been waived.  Their website is busy, and their phone lines are just as busy.

When will you get benefits:

DWD says you will get your first payment within three weeks as long as your employer does not fight the claim.  You must file a voucher every week listing all income and your job search efforts if still required by DWD once they implement the new rules.

It is clear that the intent of this legislation is for the federal government to provide hundreds of billions of dollars to state governments.  Those state governments will then change their rules and interpret the new federal laws as best they can.

Our advice is that you do the following and please realize we do not currently know more than is in this email:

If you have questions, please do one of the next or all of the following:

Email DWD at   AskUIContactCenter@DWD.com

Call DWD at 1-800-891-6499

If you contact DWD, you will need to be patient because they are overwhelmed.

Call Congressman Jim Banks’ Office at 260-702-4750, they claim to have people who are experts on the new legislation, and this might be your best bet the next couple of days.

DWD has a great website, and you can find most of your answers there.  They have a COVID-19 section that was last updated on March 26 th , 2020.  You should check their website for updates.

If you think you qualify for unemployment, you should go to the Indiana Department of Workforce Development website and file a claim immediately. The sooner you get the process started, the sooner you will get your first check.     https://www.in.gov/dwd/2362.htm   Filing a claim takes many people an hour or more and needs to be done from a computer or tablet.  Sometimes it can be done from a powerful smartphone; however, many people are having problems using a smartphone.  If you do not have a computer or tablet, you need to get a friend or family member to help you; most public buildings are closed, as are most government offices.

Once you file your claim, watch your email closely and log into your new online account frequently to monitor the status. Remember, if your request is denied, you should call them to discuss, and you should appeal it.  Congressman Jim Banks’ office can help you with this.

Every week you need to log into your online account and file a weekly voucher telling them your earnings, job status, etc. This is important and must be done.

These are tough times, and we are trying to give our clients as much information as we can.  If you have further questions, please reach out to DWD or the office of Congressman Jim Banks.  We are overwhelmed with work due to all of this new legislation, and we honestly have put everything we know about this topic in this email!

SBS CPA Group

Mike Sylvester, CPA

 

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Why You’re Getting More Tax Notices

By Mike Sylvester • June 25, 2025
Summer has arrived in Fort Wayne, Indiana. Both the Internal Revenue Service and The Indiana Department of Revenue are sending more incorrect tax notices. Worse both have changed their notices to provide little, or any information, forcing us to reach out to them and talk to them to find out what their notice means. Both agencies are struggling due to budget cuts. We expect this to get worse over the next couple of years. We are happy to help you with tax notices; however, they currently take a long time to resolve, and we charge separately for resolving tax notices. The Internal Revenue Service is in complete disarray due to DOGE cuts and some reports show that the IRS may only answer 16% of phone calls they receive next tax season. Further, we are seeing it take the IRS years in some cases to respond to notices, and it now often takes them 6 to 12 months to process amended returns, old year returns, and returns for those who are deceased.  The tax agencies are much harder to deal with than they were five years ago; and we expect this to get worse due to budget cuts.

TaxDome Implementation

By Mike Sylvester • June 25, 2025
SBS CPA Group implemented TaxDome this year. Our clients really like the easy-to-use portal, and more than half of our clients are using this platform. We expect that number to grow significantly. We like TaxDome and have received great feedback from our clients. A copy of your tax returns is in TaxDome. You can retrieve them yourself any time. If you need help please reach out to Nikkie Reyes at Admin@sbscpagroup.com or call her at 260-407-5000 and she can help you retrieve a copy of your tax returns from TaxDome or, if needed, she can get them to you in another way. If you have not opted into TaxDome, please opt in. Just email Nikkie or call her and she will help you opt in. If you are married and file a joint return both of you need to opt into TaxDome. Opting into TaxDome is not required for current clients next year. We really like TaxDome, and you will too. Please give it a chance. Mike Sylvester, CPA

Social Security And Retirement: What You Should Know In 2025

By Mike Sylvester • June 17, 2025
The Original Purpose of Social Security: A Three-Legged Stool Social Security is a cornerstone of the United States' social safety net. Many Americans depend on this program to fund their retirement. The most recent data available from the Social Security Administration highlights the program's critical role in retirement planning. Social Security benefits account for approximately 30% of the income for individuals ages 65 and older. Retirement income was envisioned as a three-legged stool consisting of pensions, personal savings, and Social Security, each contributing one-third. The program was never intended to serve as the primary source of retirement income. Many Lower-Income Retirees Rely Heavily On Social Security 51.8% of individuals ages 65 and older depend on Social Security for half or more of their income. 24.7% of people in this age group rely on it for 90% or more of their income. Statistics Regarding Which Retirees Depend On Social Security The extent of reliance varies significantly by income quintile ; note the first quintile is the lowest 20% of taxable income and the fifth is the highest 20%: In the 1st quintile, 64.1% rely on Social Security for 90% or more of their income in retirement. In the 2nd quintile, 47.8% rely on Social Security for 90% or more of their income in retirement. All the way up to the 5th quintile, none of whom rely on Social Security for 90% or more of their income in retirement. Can Social Security Survive Beyond 2033? The program faces significant challenges. Without reform, Social Security will not be able to pay full benefits by 2033 . This presents a critical issue for Congress, as reductions in benefits are politically and socially untenable. Many changes are being made to the program via the Department of Government Efficiency. Further The Social Security Fairness Act was passed into law on January 5 and this brought more changes to the program. How Social Security Benefits Are Calculated Despite its importance, many people are unaware of how their Social Security benefits are calculated. Since the Social Security Administration ceased mailing statements in 2011, individuals must proactively set up an online account to access this information. The benefit formula is intentionally progressive, favoring lower-income earners by replacing a higher percentage of their income. For higher-income earners, Social Security becomes less significant as a percentage of their total retirement income. Terminology For Calculating Your Social Security Benefit 1. Credits: To qualify, individuals must earn 40 credits. In 2025, one credit is earned for every $1,810 in covered earnings (most often wages), with up to four credits given annually. 2. Average Indexed Monthly Earnings: The AIME figure is based on a worker's 35 highest-earning years, adjusted for inflation. If fewer than 35 years of earnings exist, zeros are averaged in. 3. Primary Insurance Amount: This is the monthly benefit a person receives at full retirement age. PIA is calculated using a formula adjusted annually for inflation. 2025 Social Security Payout Example: How The Formula Works Bend points are critical to the calculation and can be used to ensure you draw as much as possible in retirement. For a retiree with an AIME of $7,391 (This is annual wages of $88,692 in 2025 dollars): • 90% of the first $1,226 = $1,103.40 • 32% of the amount between $1,226 and $7,391 = $1,972.80. • Total PIA = $3,076.20 (before Medicare premiums). Strategies To Maximize Your Social Security Benefits To optimize benefits: • Aim for an AIME of at least $1,226, as the first tier yields a 90% replacement rate. • Understand that amounts above $7,391 are replaced at only 15%. Reviewing your lifetime earnings is crucial to ensure accuracy. Errors are far easier to correct early on than later on, when reconstructing decades-old income records may be challenging. Will Your Social Security Be Taxed? What Retirees Should Know Since 1983, up to 85% of Social Security income has been subject to federal taxes, depending on other income sources. This makes the program more progressive but also adds complexity to retirement planning. Consider discussing this with your tax professional and financial planner. When Should You Start Collecting Social Security? When to begin drawing Social Security benefits is a critical decision, particularly for married couples. Meeting with a qualified financial planner may be appropriate. Starting benefits early results in reduced monthly payments, while delaying up to age 70 increases them. Careful analysis and planning are essential to maximize lifelong benefits. Final Thoughts: Why Understanding Social Security Matters More Than Ever Social Security is a vital program for most Americans. Understanding its mechanics and planning effectively can significantly impact your retirement security and should be carefully considered before retirement. I do some consulting on this topic and if you want to hire me to do some Social Security planning please send me an email at Mike@sbscpagroup.com . Mike Sylvester, CPA

Tax Season Hours

February 1, 2025
Tax Season hours at SBS CPA Group (Feb 2 nd -April 15 th ) Monday thru Friday 8:30am to 6:00pm Saturday 9:00am to 4:00pm

Tax Season is here!

January 31, 2025
Tax season is here! We’re ready to start filing returns and need your documents all at once . Please provide: Your completed tax planner All source documents How to Send Your Documents Please choose one method: ✅ TaxDome – Upload all documents, name them , and click “done uploading” so we know you're finished. ✅ Drop off – Bring them to our office. ✅ Mail – Send them to our office. ✅ Email – Send everything to your CPA. Why Use TaxDome? If you activate your TaxDome account, you can: ✔️ Download copies of your tax returns ✔️ Upload documents easily ✔️ Sign returns electronically (if both spouses have emails on file) Important: TaxDome emails come from notifications@taxdome.com . If you didn’t get an invitation, check your spam folder. Still no email? Contact Nikkie Reyes at admin@sbscpagroup.com or call 260-407-5000 . We look forward to another great tax season!  SBS CPA Group Team

Health Care Sharing Ministry

January 26, 2025
Starting in 2024, members of qualifying health care sharing ministries will be able to deduct their health care sharing expenses on their Indiana tax returns. Qualified health care sharing expenses are defined as the amount paid by a qualified individual for membership in a health care sharing ministry. You must be a resident of Indiana and have been a member of a health care sharing ministry for at least a month during the year to receive the deduction. But what is a health care sharing ministry? A health care sharing ministry is a type of nonprofit organization where members share healthcare expenses based on mutual faith and commitment. It is not insurance-members help cover each other's medical costs. While they can be quite beneficial, they also have drawbacks. If you are considering switching to a health care ministry, do your research to decide if it is right for you.  Let your tax preparer know if you are a member of a health care sharing ministry. Keep track of your qualified health care sharing ministry expenses and make sure you give them to your tax preparer, along with all of your other documents, at tax time. Jennifer Thonert, CPA

Indiana Military Pay

January 25, 2025
If you are an active member of the military, get ready to pay less state income tax to Indiana. Starting in 2024, Indiana will no longer tax any active-duty military pay. In prior years, Indiana would allow up to $5,000 of active military pay to be non-taxable, but a new law has passed making the entire amount exempt for those that qualify. To qualify, you must be a resident. To make sure you are considered an Indiana resident, confirm the following to be true: 1) Indiana is listed as your “home of record” on your military documents. 2) A DD Form 2058 is on file saying Indiana is your legal residence. 3) Your permanent address with the military is an Indiana address. 4) You have a current Indiana driver’s license. 5) You are registered to vote in Indiana. 6) You file an Indiana tax return. 7) You have ties to Indiana, such as a bank account. Once you determine that you are a resident, the next step is to file an Indiana tax return. Even if it is the only income you have, you must still file the return in order to claim the exemption. You do not have to attach proof to the return that you have active-duty status, but you are required to substantiate it if it ever gets called into question. Keeping a copy of your orders is advised. Also, make sure at tax time that your tax preparer knows you qualify for this exemption. Jennifer Thonert, CPA

Indiana Income Tax Free Nonresident Employee Wages

January 24, 2025
Are you someone, or do you have an employee, who is not from Indiana but works here for short periods? Beginning in tax year 2024, Indiana has an income tax exemption for some nonresident employees. If they work in the state for 30 days or less, the state of Indiana will not collect income taxes on their wages. Employers do not need to withhold state income tax from these employees. However, it is only a state exemption-not a local one-so local income taxes will still need to be withheld, if applicable. In order for the nonresident to qualify for the exemption, the following circumstances must be met: 1) They must have been a nonresident for the entire year. 2) They must have worked in Indiana for 30 days or less. A workday counts as an Indiana workday if more than 50% of the hours that were worked that day were in Indiana (transit time does not count in the calculation). 3) They must not have the following professions: professional athlete, professional entertainer, or public figure that gets paid per event. These professionals will still be subject to income tax no matter how many days they work. Anyone who is exempted does not have to file an Indiana tax return, unless their employer withheld Indiana income tax. In that case, a tax return will need to be filed to get a refund. If the employee happens to cross the 30-day threshold, their entire year’s Indiana income then becomes taxable to the state, unless they are residents of a reciprocal state. Indiana has reciprocal tax agreements with six states: Illinois, Kentucky, Michigan, Ohio, Pennsylvania, and Wisconsin. People who live in those states but work in Indiana already do not pay Indiana state taxes, so the new rule does not affect them.  Make sure to let your tax preparer know if you are, or have, one of these employees.

Indiana Attainable Homeownership Tax Credit

January 16, 2025
In 2023, Indiana introduced the Attainable Homeownership Tax Credit, which is designed to encourage contributions to affordable housing initiatives in Indiana. If you are looking to contribute to a meaningful cause, while benefiting from a significant tax incentive, this credit could be a fantastic opportunity. Currently, the only organization approved by the Indiana Economic Development Corporation (IEDC) to receive credit-eligible contributions is Habitat for Humanity of Indiana (including its local affiliates). The tax credit equals 50% of your contributions to Habitat Indiana, with a maximum credit of $10,000 per taxpayer per year. For married couples filing jointly, the maximum credit is also $10,000 per couple. Contributions can include cash, checks, stocks, and bonds. These contributions are valued at their fair market value at the time of the donation. The value of services, labor, or reduced-cost equipment is not eligible for the credit. To claim the credit, Habitat Indiana will provide a certifying number (PIN) that must be listed on Schedule IN-OCC. The program has an annual statewide credit cap of $4 million per fiscal year (July 1 – June 30). Credits are allocated on a first-come, first-served basis, based on when returns are received. If the annual cap is reached, any credits claimed afterward will be permanently disallowed, though carryovers will remain valid. Credits are limited to your Indiana state tax liability after applying other nonrefundable credits. For example, if you qualify for a $10,000 credit but your state tax liability is only $8,000, the unused $2,000 can be carried forward to future years. This tax credit is a win-win: it supports Habitat Indiana’s mission to provide affordable housing while offering a substantial incentive for taxpayers. Whether you are an individual, a couple, or a business, contributing to this program can make a meaningful impact on Indiana communities. If you are considering contributing to Habitat for Humanity of Indiana, ensure your donation meets the eligibility criteria and plan to claim the credit promptly to avoid missing out due to the annual cap. For further questions about the Attainable Homeownership Tax Credit, feel free to reach out to the partner in charge of your account. Thank you for reading!  Nathan Skinner

Happy Holidays from SBS CPA Group

December 20, 2024
SBS CPA Group will be closed Dec. 24th thru Dec. 26th, allowing our staff time to spend with family. We will also be closed New Year Day, Jan. 1st.
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