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Filed paperwork for LLC…Denied Unepmoyment Benefits Pennsylvania

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  • Filed paperwork for LLC…Denied Unepmoyment Benefits Pennsylvania

    I worked for a firm for two years before I was laid off this past spring. I did some consulting work through the spring and early summer, but I reported all my earnings according to schedule. In mid summer I filed paperwork to start an LLC and acquired a tax ID and attributed my meager and inconsistent consulting earnings to the LLC.

    In August I reported that I started a company to the unemployment office and they began an evaluation of my employment status. My earning have averaged well below $250 a week, but I continued reporting what I earned even during the evaluation period. After six weeks deliberation the Unemployment Office denied me benefits because I started a company. They’ve also required me to pay back the benefits I earned between starting my LLC and reporting it to the Unemployment Office.

    I’m making very little money, lost my unemployment benefits, and now I owe money. Please provide some guidance. What strategy should I use to appeal this case? Thanks you.

  • #2
    This is a problem a number of people are running into. I attribute it to putting the cart before the horse. For someone making a few dollars here and there consulting, forming a business and making oneself an employee is not a good idea. That is something to do as an individual. It is great to have plans for what to do when the business takes off, but unless an individual is quite unethical, the protection provided by an LLC is really not needed for occasional work.

    Since they have already made a determination against you for UI, reversing it can be tough. I would suggest trying (1) stop taking assignments as the LLC (2) any work you can get, take as an individual (3) report to UI that the business you tried to start, failed and is no longer operating. (4) You don't need to shut down your LLC, leave it non-operating in case you need it later.

    I don't know if that will work, but it's the best shot that I can think of. Maybe someone else has a better idea or can build on this.
    Please post questions on the forum rather than sending me a private message or email. That way others who have similar issues have access to the discussion.