Financial Help for Freelancers and Independent Contractors Affected by the Coronavirus Crisis

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The financial crisis resulting from the rapidly worsening COVID-19 crisis is having a devastating effect on workers, especially freelancers, independent contractors, and gig workers. Many of these people have seen their income greatly reduced or eliminated entirely. And a number of these individuals operated with little or no savings.

What financial assistance may be available to help freelancers and independent contractors? In this article I list some possibilities, mainly as a result of the March 27, 2020 passage of the CARES Act by the federal government, which injected $2.2 trillion of assistance to companies, state governments, freelancers, small businesses, and employees.

1. Unemployment Compensation Benefits Are Now Available to Freelancers and Independent Contractors

Unemployment compensation benefits were usually reserved only for employees who were laid off from their job. Under the CARES Act, independent contractors and freelancers are now eligible to receive unemployment benefits as well. The CARES Act even increases the amount of benefits by $600 a week.

To claim the unemployment benefits, freelancers and contractors should log on to their state’s unemployment websites and apply as soon as possible for benefits. For example, the California site is at

Unfortunately, the unemployment compensation websites are still being updated to take the new law into account, and the instructions will be confusing for independent contractors. In addition, the sites are being inundated with applications. Phone calls are being unanswered due to sheer volume. The best thing to do at the moment is to file online as best you can and hope that the state follows up with any questions.

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The amount of unemployment benefits will depend on what state you are in and what your income has been as an independent contractor. The benefits typically are 20% to 50% of what you previously earned, together with the extra $600 per week provided by the CARES Act.

Many states provide for 26 weeks of benefits. The CARES Act provided eligible employees and freelancers with an additional 13 weeks.

2. $1,200 Payment from the IRS

Independent workers and freelancers are entitled to receive a $1,200 payment ($2,400 for married couples) from the IRS, plus an additional $500 per dependent under 16. In order to qualify for the full amount, you have to have earned $75,000 or less in the prior year ($150,000 or less if married). If you haven’t prepared your 2019 tax return, you can use your 2018 return to see if the income threshold is met.

In order to make sure you receive this amount in a timely manner, your 2018 or 2019 tax return should have been filed with the IRS. If you haven’t filed your tax return, there are some free services that allow you to file your return electronically. See those recommended by the IRS at

You will ideally want to receive this amount by direct deposit into your bank/checking account, so make sure the IRS has this information. You can do this by filing IRS Form 8888. The IRS has also said that it would build an online portal soon where people can update this information.

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