Unemployment aid to millionaires skyrocketed during pandemic

Unemployment aid to millionaires skyrocketed during pandemic

Experts cited a number of reasons for the apparent anomaly, including expanded benefits passed by Congress to prevent an economic collapse amid widespread layoffs and company closures.

“Tens of millions of workers were laid off from their jobs in 2020 and it was a very broad range of people, including people who had been making very good incomes,” said Amy M. Traub, senior social security researcher at the National Law Project. Labor.

It’s a small, albeit surprising, part of the nearly 30 million tax returns that reported receiving unemployment aid that year.

The figures were included in a large body of data released by the IRS, though the department doesn’t say how people earned enough money to rank in the top 1 percent of incomes ($591,000 in 2020) while collecting unemployment aid in the same year.

Some of those who received help probably had more typical incomes, but were married to highly paid people with whom they filed their taxes jointly, experts speculated. You may also include small business owners eligible for assistance for the first time that year.

“A lot of places just closed,” said Mark Mazur, a former top tax official in the Biden administration. “People were told to file for unemployment and they did, and the states in general made it pretty easy.”

“You’d think the millionaires who had that opportunity would be among the best-advised people.”

The numbers also show how the total number of people receiving unemployment checks skyrocketed in the wake of the pandemic, dwarfing what was seen in the Great Recession.

About 29.9 million people reported unemployment benefits that year, an increase of 585 percent from 2019. Aggregate benefits reported totaled $405 billion, an increase of 1,794 percent.

In 2009, in the midst of the Great Recession, 11.3 million returnees reported unemployment benefits.

Unemployment soared in the first few months of the pandemic, amid stay-at-home orders and overnight business closures. By April, the unemployment rate had more than quadrupled to 14.7 percent.

Congress passed a vast expansion of unemployment aid that increased how much people could receive, how long they could receive it, and expanded the number of people who could qualify to include self-employed workers, independent contractors, temporary workers, and others.

The aid is credited with not only helping people stay afloat, but also preventing a deeper economic downturn.

Benefits are available to individuals regardless of how much they earn; it is a type of insurance, not a traditional government benefit program. The aid is funded through federal and state taxes imposed on employers.

“Unemployment insurance is intended to be a support for workers who lose their jobs, and people who had a good income before they were laid off deserve to receive those benefits as well,” Traub said.

The vast majority of the assistance, nearly 90 percent, went to people making less than $100,000, the data shows.

Millionaires received a total of $264 million in relief, which is less than one percent of all reported unemployment benefits.

Others earning less than seven figures also applied for assistance in 2020. Nearly 70,000 filings reporting income between $500,000 and $1 million received unemployment insurance checks along with 750,000 filings for people earning between $250,000 and $500,000.

Melissa Galbraith
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.