web store and unemployment

by julio
(san jose, ca)

i have been unemployed for over 2 years after being employed full time for 13 years and going on forth extension in califonia, so here is my question, after looking for any type of job and finding nothing, i opened a webstore recently selling stuff that i hand make,"my hobby" i haven't really made any money and only spend about 10 to 20 minutes a day making stuff if that...do i have to tell edd that i earned 10 bucks? or if i sell something on ebay?




Hi Julio,

Good question .. I commend you .. as I have my own story about going into business for myself and I have difficulty understanding why more don't see employment freedom via self employment as a possible solution to potential long term unemployment or repeated bouts with having to go back to collecting after the last temporary gig.

However, you can bet I was cognizant of exactly how that would/could affect my UI benefits so I planned every move I made accordingly.

My husband was the owner of this website, until I did in fact form an LLC and by then I had stopped collecting voluntarily, for a legitimate A&A issue.

Most states ask .. I know mine does, at the beginning of the claims process about all sources of income including self-employment efforts.

Of course you would have to report the income .. but ..

The rules vary as usual from state to state about self employment and the little issue of being able and available .. so when you start the business after you start filing there's all kinds of ways the state may get wind of it from filing for an actual trade name or formation of a business entity with the state.

If I lived in NY or PA .. I would have been extra careful.

As far as I can tell, there really is no way around flagging a claim when starting a business subsequent to filing a claim if you earn money.

It's not revealing a business and then earning money which you have to report that creates problems.

I myself could have very well started to monetize this site much earlier than I did if it weren't for the fact that I went back to work for my former employer and felt that it would have been a conflict with the job. It would have been the concurrent efforts of a job .. and self employment in the evening that would have only meant I would have been subject to partial benefits.

I would have been very willing to take my lumps with any investigation into my ability and availability for work because my state reasonably allows for the two simultaneously if you're able to prove you did both concurrently and of course I would have been able to supply records for the required job search as well.


But I never told the state about this website .. because up until I stopped collecting .. it wasn't a "business". I made no money from it and I thought of it as a "hobby" or practice for learning how to build a website .. as odd as that sounds to me now.

Additionally, I took an added precaution even when I was clearing the house out on Ebay (by the way SBI was a big help optimizing my ebay auctions) and writing for Unemployment-tips.

Spousal trust is essential for what I did:)

But when we realized I'd have to stay home to take care of his mother .. all bets were off when I voluntarily stopped collecting benefits .. because I was no longer A&A.

I didn't have anything left to sell on Ebay so ...

That's when I changed things up for good here on this website. And, what a relief it was.

I knew I had to earn money from the website .. no ifs, ands, or buts about that.

The first thing I did was to remove the choke hold that benefits have on us all while collecting. There's nothing like the rules to be eligible to collect to kill the first glimmer of an initiative and impede forward movement away from the need for the benefits.

This decision alone freed me to make decisions without thinking through the unemployment issues with a focus on cause/effect due to something I might do.

But, since I know you live in California .. I also know those are the only state rules that apply to you. .. (by the way, if I'm not mistaken, from past question asked here I seem to recall XE means "covered employment", but verify that please, for yourself.)

As I've said before, Unemployment benefits are not created equally. Rules are state specific and with regard to specific unemployment issues.

Self employment forces me to consider criteria for the unemployment issues of being able and available for suitable work (A&A), total or partial unemployment (TPU in CA), and of course the requirements for what monies must be reported when filing for weeks of benefits and the requirements of a job search in case of random audits of said job search requirements.

One more thing .. you should try some search queries if you happen to use paypal about what levels of income requires Paypal to report to the IRS .. I think that too could be relevant for more understanding about your issue as UI fraud detection relies upon referencing other databases.

I know the question has been raised before .. even here and I provided a link to what I found about paypal/IRS requirements.