What’s Working: Colorado’s big BYE week for unemployment, the $10,200 tax question and our ongoing economic recovery

A year ago, Colorado was just realizing how serious the impact of pandemic safety measures were with a statewide stay-at-home order that pretty much halted in-person commerce. The week of April 5, 2020, became the worst week of unemployment the state had ever seen, with a record-setting 104,217 Coloradans filing their first jobless claim in the pandemic. 

Fast forward one year and we’re now entering BYE week, or the benefit year end. Colorado limits claims to one year, so anyone in their BYE week would normally be saying buh-bye to unemployment payments. 

But if you’re still out of work, don’t fret. The recently passed American Rescue Plan keeps payments flowing until Sept. 6. However, those at their year end must file a brand new claim for regular state unemployment or Pandemic Emergency Unemployment Compensation, or PEUC. 

There’s a different schedule for gig workers and self-employed workers on Pandemic Unemployment Assistance. PUA folks must file a new claim at the start of every new quarter, or by the first of January, April, July and October. 

“It does not matter at what point in the quarter a claimant filed their original PUA claim,” said Jessica Hudgins Smith, press secretary for the Division of Unemployment Insurance. “They’ll still have to refile at the start of each quarter.”

The PUA requirement is from the CARES Act and it’s to make sure pandemic gig workers are not eligible for regular state benefits. 

So, whether you’re in the BYE week as a regular unemployed person or you’re a PUA user, click the “Apply for standard UI” button in your MyUI+ account to file a new claim. 

COVID-19 economic recovery

COVID-19 vaccines are now available to any Coloradan age 16 and up (if you need one, check The Sun’s tips on finding an appointment). Restaurants, bars and other indoor events are allowed to operate at 50% of their pre-pandemic activity (many counties are already back to 100% — see the blue and green counties on the map of the state Department of Public Health and Environment). 

And according to the latest quarterly business confidence survey from the University of Colorado Leeds School of Business, vaccine proliferation and “hopes of a real reopening of the economy” have businesses optimistic about summer and beyond.

“Business leaders are seeing what’s going on around them and they’re reacting to that in terms of the broader state economy,” said Richard Wobbekind, director of the Business Research Division at Leeds. “They’re seeing industry sales expectations going up dramatically. And this is not just seeing the state being strong, but actually seeing people interested in their product.”

He said certain sectors — leisure and hospitality, mining and logging — are seeing a slower return to full employment. Among survey respondents, “over half stated they wouldn’t get back to full employment levels until 2022 or beyond 2022.” But overall, plans to hire increased, with expectations at 58.8% for the second quarter, compared with 29.3% in the first quarter. 

→ Speaking of hiring, as of Friday, the state’s job board is back down to 70,226 openings, after reaching about 92,000 a week ago. My story on jobs is still in the works. Stay tuned.

→ $1 billion: As of March 31, Colorado owed $993.9 million to the federal government. The state had to borrow money to cover the depleted Unemployment Insurance Trust Fund. While benefit checks have continued to flow to jobless workers, the high loan will have a dire impact for employers. If you missed this, here’s why you should care: Colorado’s unemployment fund is nearly $1 billion in debt. Small businesses are worried about paying the tab.

IRS clarifies taxes 

A few interesting twists this week for anyone on unemployment. Those who are receiving benefits hopefully realize that unemployment pay is taxable. That’s why the state gives folks the option to have taxes withheld from benefit checks. 

Bonus tax relief came in the American Rescue Plan, which allows jobless Americans with adjusted gross incomes of less than $150,000 to skip taxes on the first $10,200 of unemployment received last year (and $20,400 for married couples filing jointly).

But how does one qualify? 

The IRS said this week that if you’ve already filed your taxes, you don’t need to file an amended return. The agency will recalculate the amounts and issue refunds automatically with the first refunds expected to be delivered in May. 

For those who still haven’t filed, the IRS says those who qualify for the exemption need to report it separately on Schedule 1, line 8. 

But Colorado residents (as well as those in Idaho, Minnesota and several other states) still must pay state income taxes on the $10,200. The state Department of Revenue says this is because Colorado’s income tax statutes don’t allow the state to integrate retroactive changes made at the federal level. Sorry!

At least everyone is getting an extra month to file taxes this year. State and federal taxes are now due May 17.

→ Did you get your stimulus check? Search your status on the IRS website. >> Search

IDme and those darn fraudsters

Seems like you just can’t escape unemployment fraud — whether your ID was stolen and used to file a fraudulent unemployment claim or you’re stuck in an unemployment hold because someone already filed under your name. Now we’re hearing the ongoing fraud is holding up the tool meant to thwart fraudsters. 

The online tool IDme became the topic of a last-minute news conference by the Department of Labor on Thursday. While other issues were discussed, officials focused on why some people faced five or more hours of waiting to get their IDs verified on the tool.

Phil Spesshardt, acting director of the state’s Unemployment Insurance Division, said it’s due to IDme adding other states as customers, and ongoing fraud.  

“We are constantly communicating with IDme so that they can continue to improve the process for our customers,” he said, and that includes hearing IDme is hiring additional staff for video calls to verify people are who they say they are.

Keep in mind the long waits are only for those who cannot pass the automated process and need to do a video chat with one of IDme’s “Trusted Referees.” 

MORE: Coloradans face hours-long delays as unemployment ID verification system is required for everyone receiving benefits

A bonus for What’s Working readers, here’s more on the topic from Blake Hall, IDme’s CEO. 

If you have your verification documents in order, plus a modern smartphone with speedy internet, the process can take “just a few minutes,” Hall said. 

Nearly 90% of applicants who use IDme pass the automated process. 

But the other 10% must wait for a trusted referee to approve them in a video call. A call with an IDme referee can help a customer get verified even if they have no credit history, are missing certain records or have outdated records.

When you’re ready to get verified, Hall suggests these tips to speed up the automated process and avoid needing a human to intervene:

• Get needed documents together, including an unexpired driver’s license, state ID or passport. Secondary documents include a Social Security card, birth certificate or health insurance card. Photocopies aren’t allowed.
• Take in-focus pictures of your documents and yourself.
• If you cannot wait and choose to “come back later,” IDme saves your request but you lose your place in line. You take a chance that it’ll be less congested later.
• Reasons for a failed attempt include a recent move to a new address, a locked or frozen credit report, erroneous information on your credit report, typos, submitting expired documents, not taking a selfie when prompted and submitting a phone number not associated with your name and address. More reasons are listed here.
• Those who don’t have the proper computing devices should call CDLE for assistance at 303-536-5615.

→ Expired driver’s license? Colorado allows for renewals online as long as it hasn’t been more than one year since your license expired. >> Renew online

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To reiterate, the state’s unemployment system will continue to get slammed in this next week as people in their BYE week file new claims. Add that to ongoing fraud, delays with IDme, plus existing issues for users who are still trying to get paid, it could be a long next week. 

At least I’m hearing pretty much zero complaints about CDLE’s rollout of the latest relief plans’ extension of benefits for 29 weeks. The balancing act for unemployment staff continues, though, as we wait for new updates on mixed earners, ex-State Extended Benefits users who didn’t get PUA and others. Don’t forget to check the state’s issues page for daily unemployment updates.

The state’s main unemployment support line at 303-536-5615, continues to show very low wait times (an average of 18 seconds for Wednesday!) so at least log your issue over there, ask for help among the private Facebook unemployment groups and call 2-1-1 for help with housing, food and other needs. Hang in there everyone. ~tamara