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Marsha411JD
Marsha411JD, Lawyer
Category: Criminal Law
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Experience:  Licensed attorney with 29 yrs. exp. in criminal law
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Since being off at the end of 2012 I have collected unemployment

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Since being laid off at the end of 2012 I have collected unemployment benefits. From time to time I have received freelance work, which now totals almost $6K. I did not report that when I made my weekly reports to NYS because I was and still am struggling to survive. I kept thinking that things would get better and that I would later on report those earnings so that there would be no overpayment in total. However the year is almost over and I am sure that eventually the NYS Department of Labor will find this out because of the 1099 forms to be filed. I want to turn myself in before they come after me but do not know what is the best thing to do. I still do not have a job but of course I want to make this situation right.
Hello,

Thank you for the information. We cannot tell you what to do since we cannot form an attorney-client relationship under the TOS of this Site or our Bar ethics rules. However, I can discuss the legal issues and possible ramifications if that is what you are wanting. If so, just let me know that you want to continue with that understanding.
Customer: replied 3 years ago.

I think I understand. And I guess I am still trying to determine if I am better off reporting myself to the Department of Labor now instead of waiting until they catch up with me in 2014. Is that something you can give me some sense of, based on the issues and ramifications that you will discuss?


 

Hello again and thank you for your reply. There are a couple of options if you want to straighten this out now. One is to just start reporting this income right now as if you are earning it now until you get up to the amount that will be reported on your 1099's. The other is to call and advise the State that you failed to report your earnings. I can tell you that if you do that latter, your UI benefits will not only stop, but you are likely to get a notice of overpayment of ALL of the benefits you have been paid. In other words, it wouldn't just be that you owe back payments for the amount you mentioned, but the State would, because of alleged fraud, demand repayment of all of your benefits you have received. That doesn't mean that you couldn't appeal that determination and get it reduced, but it is likely to be their reaction.

If you don't do either of the above steps, then when the State figures out you did have earnings, then they will send you the overpayment determination, just like I mentioned, which will likely be for everything you received from them during this period, which would necessitate an appeal and/or negotiation. So, other than starting to report your earnings now, as if you were earning them now, coming forward and confessing or waiting until you are found out will result in the same consequences. It is up to you though which way you want to go.

If you have specific follow up questions, please let me know. I would be glad to assist you further if I can.
Customer: replied 3 years ago.

Thank you for your help. It sounds like I would be better off beginning to report those earnings as if I were earning them now, as you said. However, in the next couple of weeks I am taking training (approved by the department of labor) to get a real estate license and then will begin hopefully working as a real estate agent in early November. Although this is a commission only job, I probably will only be reporting benefits for about two to three more weeks. Practically speaking I probably can't report all of the earnings within that time period (unless I were to receive no benefits at all). But, would it help me to at least report some of the earnings rather than none? Also, given that I will be working (albeit as an independent contractor, as all real estate agents are) for the last two months of 2013, is it possible that the unemployment office might overlook the 1099s for the other freelance work (because at least theoretically I might have done that work during the last couple of months of the year). Of course I know that is not honest, but I am really stuck about my options.

That does complicate things a bit, and as I mentioned, I can't tell you what to do, but if you would feel better if you report some of the earnings, then you should. Ultimately though if the numbers don't add up, assuming the State does an audit of your tax reports, then you will get the blanket overpayment decision and have to appeal and negotiate it. I am not really comfortable saying that the fact that you have other earnings might mask the earnings you didn't report, that is doubtful. But, anything can happen.
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