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Surviving a Layoff

May 8, 2009 | Financial Tips | 2 Comments

Every month hundreds of thousands of Americans are getting laid off.  With the unemployment rate at 8.5% as of April 2009, millions of families have to deal with the uncertainty and stress from losing their jobs.

The good news is that President Obama’s 2009 Stimulus Package (American Recovery and Reinvestment Act) helps people out of work.  There are a few things that you should be aware of.

The first $2,400 from unemployment benefits in 2009 is exempt from federal income taxes.  Of course anything benefit over the $2,400 you will have to pay taxes for.

Unemployment benefits have been extended for 20 weeks plus an additional 13 weeks in high unemployment areas such as Michigan.  Check with your local unemployment office to determine if you eligible for an extension. The date you must exhaust your regular unemployment benefits in order to qualify for extended unemployment benefits has been changed to December 31, 2009 from March 31, 2009.

Although this doesn’t see like much, every dollar helps.  Unemployment benefits have been temporarily increased by $25 per week. Prior to the increase, the average weekly unemployment benefit was about $295.

The government has subsidized COBRA coverage allowing you to keep medical insurance coverage provided by your former employer.  COBRA is usually more expensive, however, for workers laid off between September 1, 2008 and December 31, 2009, the government will subsidize 65% of premiums under COBRA for up to 9 months.   Be sure to contact your former employer to determine if you qualify for the new subsidized COBRA insurance.  The 65% subsidy is for individuals with yearly salaries of $125,000 or less or for couples filing jointly making $250,000.

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2 Comments to “Surviving a Layoff”

  1. Imee
    3:56 am on May 13th, 2009

    I think the info you posted here about the ARRA/stimulus package, with regard to unemployment, is great. There’s a lot of stuff the unemployed can take advantage of if they qualify, in order to rise back up again.

  2. How to Survive a Layoff | Money Cake
    5:21 pm on September 23rd, 2009

    […] Surviving a Layoff […]

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