how is unemployment insurance funded 
unemployment insurance is funded by taxes on employers such as the futa and various state taxes futa charges 6 of the first 7 000 of each employee s wages although this is offset by a 5 4 credit for on time tax payments 4some states pay for unemployment benefits by debiting the former employer s ui account or by raising the employer s ui taxes in future years since employees are usually not eligible for ui if they quit voluntarily some employers may pressure their employees to resign rather than fire them unemployment insurance during the covid 19 pandemicon march 11 2020 the world health organization declared covid 19 the illness caused by a novel coronavirus to be a pandemic states and businesses across the u s closed down causing massive unemployment 112lawmakers agreed on the passage of the cares act a landmark piece of legislation that in part expanded states ability to provide ui to millions of workers affected by covid 19 including people who aren t ordinarily eligible for unemployment benefits the bill was passed and signed into law in march 2020 13three specific programs were designed to help americans who were out of work because of the coronavirus a fourth program was established through an aug 8 2020 memorandum issued by president trump in response to the expiration of the federal pandemic employment compensation program 914while people who voluntarily quit their jobs do not normally qualify for ui you may qualify for benefits if you quit due to unpaid wages unsafe working conditions a sudden decrease in your hours or certain other factors the legal term for this is constructive dismissal 15the federal pandemic unemployment compensation fpuc provided an extra weekly benefit on top of regular ui the original benefit provided an additional 600 weekly under the cares act but that benefit expired on july 31 2020 the fpuc was modified and extended as part of the consolidated appropriations act in december 2020 another extension of the fpuc was approved after president joe biden signed the 1 9 trillion american rescue plan act of 2021 on march 11 2021 under the plan fpuc benefits expired on sept 6 2021 9the pandemic unemployment assistance pua expanded ui eligibility to self employed workers freelancers independent contractors and part time workers impacted by the coronavirus pandemic self employed workers generally may not qualify for ui and the pua provided them with financial assistance as per the american rescue plan act the pua expired on sept 6 2021 after a total of 79 weeks 9the pandemic emergency unemployment compensation peuc extended ui benefits under the cares act after regular unemployment compensation benefits were exhausted the peuc program officially expired on sept 6 2021 9the lost wages assistance lwa program was a federal state unemployment benefit that provided 300 to 400 in weekly compensation to eligible claimants lwa came into existence in response to the expiration of fpuc on july 31 2020 16