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Coronavirus: How to get help if you’re a freelancer

Just because you're an independent contractor doesn't mean you don't qualify for financial assistance.

For freelancers or sole proprietors without the safety net of a permanent job and salary, the additional layer of uncertainty caused by the coronavirus can be more than a little unsettling. The silver lining? There are resources that can help — thanks to a few rounds of stimulus funding.

How freelancers, sole proprietors and independent contractors can benefit from the stimulus packages

The Coronavirus Aid, Relief and Economic Security (CARES) Act launched the SBA Paycheck Protection Program (PPP), which freelancers, sole proprietors and independent contractors are eligible to apply for. And it expanded how much self-employed individuals can qualify for in March 2021 by allowing them to use gross annual income to calculate payroll costs. Sole Proprietors and independent contractors can also qualify for Economic Injury Disaster Loans (EIDL).

The CARES Act also made freelancers, gig workers, independent contractors, sole proprietors and self-employed individuals eligible for unemployment benefits — which has never been offered before. It also gives states the option to extend unemployment benefits to independent contractors and other workers who normally don’t qualify. For example, California introduced the Pandemic Unemployment Assistance (PUA) Program, which allows freelancers, independent contractors and self-employed individuals to qualify for benefits.

You’re not only eligible for benefits if you contract COVID-19 yourself, but also if you’re forced to work reduced hours to care for a family member or relative that has the coronavirus. It even offers benefits to parents who are forced to stop working to care for their children whose school or daycare shut down.

You can contact your state’s Labor and Workforce Development Agency to see if you qualify for any new unemployment programs.

The Economic Aid Act

In late December 2020, Congress passed another stimulus bill, which provides even more funding for businesses in need. The PPP program reopened as of January 11, 2021, and is set to end on May 31, 2021. It allows for more First Draw loans, and Second Draw loans for businesses that used all of their First Draw funds and still need assistance.

How else can I benefit from the stimulus package?

How much can sole proprietors and independent contractors borrow from the SBA?

While loan amounts originally spanned up to $2 million for the SBA Economic Injury Disaster Loan, The New York Times reports that they’re now capped at $15,000. And previously, you could receive a $10,000 advance, which dropped to a $1,000 advance for solo workers. But the SBA has closed the grant program due to lack of funds as of July 11, 2020.

Coronavirus-related sick and childcare leave might apply to you

On March 18, 2020, President Trump signed the Families First Coronavirus Response Act, which is designed to help small- and medium-sized businesses provide payroll relief to employees affected by the coronavirus. But self-employed individuals can receive similar tax credits as well.

Employers who offer paid sick leave to employees due to the coronavirus will be 100% reimbursed by the government for up to 80 hours per employee — or even longer for parents on childcare leave. This will translate to tax credits for gig workers, self-employed individuals and freelancers.

What exactly is unemployment insurance?

Unemployment insurance is the program funded jointly by state and federal governments that provides monetary aid to eligible members of the workforce. The payments made by this program are known as unemployment benefits.

However, most independent contractors and self-employed individuals don’t qualify for unemployment insurance. That’s why the coronavirus stimulus package is so groundbreaking.

Am I eligible for support if I’m a student who was freelancing?

Maybe. Being a student doesn’t disqualify you from receiving unemployment benefits, but you’ll still need to meet the other stipulations required by the federal and state government where you live.

Am I eligible if I’m a freelancer who can’t find work, but my partner is still working?

Possibly. Just because your partner is still working doesn’t automatically disqualify you from receiving aid. Other factors, such as when you last worked and how much you earned, will also determine your eligibility.

Some states are reopening the enrollment period for health insurance

If you’re worried forgoing health insurance is coming back to haunt you with the COVID-19 outbreak, you’re in luck. Many states, including Minnesota, Colorado, New York and California, have reopened their enrollment period for health insurance.

For a limited time, you may be able to buy health insurance on the marketplace, though eligibility requirements and deadlines vary by state. Visit your state’s health insurance marketplace website for more details on what’s available where you live.

If I was exposed to coronavirus at my contract job, am I entitled to workers’ compensation?

It depends. While COVID-19 is generally not considered a work-related injury, if you can prove that exposure was a direct result of your work environment, your claim may be approved.

But it heavily depends on the worker’s compensation policy you have, your state laws and the industry you work in. As a freelancer, you won’t be covered under another employer’s policy. This means if you don’t have a workers’ compensation policy yourself, you’re out of luck.

Visit your state’s workers’ compensation agency to find out if you qualify.

How to request financial hardship for your bills

Many services, including utility companies and banks, have financial hardship systems in place for customers who are struggling to pay their bills. If you need extra time or assistance, consider checking each provider’s website or calling their customer service line directly to learn about your options.

Financial assistance for those affected by the coronavirus outbreak

What if I already have credit card debt?

If you’re worried about handling your monthly credit card payments, it might be worth looking into a balance transfer credit card.

With this, you transfer your current balances onto this new card. Many come with a 0% APR introductory period for anywhere from 6 to 21 months, which helps you pay down your debt without paying interest.

But you typically need good to excellent credit and proof you can afford repayments to qualify.

Banks offering credit card payment relief

Find a balance transfer credit card to apply for

Name Product Amount saved Balance transfer APR Balance transfer fee Recommended minimum credit score Filter values
Citi® Diamond Preferred® Card
0% intro for the first 18 months (then 14.74% to 24.74% variable)
$5 or 3% of the transaction, whichever is greater

Best of Finder 2021

An impressive 18 months intro APR on balance transfers and purchases, as well as no annual fee make this one of the top 0% APR cards available.
Citi® Double Cash Card
0% intro for the first 18 months (then 13.99% to 23.99% variable)
$5 or 3% of the transaction, whichever is greater
Get a strong 18 month 0% intro APR on balance transfers AND up to 2% back. This is a rare card that offers both rewards and balance transfers.
TD Cash Credit Card
0% intro for the first 15 months (then 12.99%, 17.99% or 22.99% variable)
$5 or 3% of the transaction, whichever is greater
3% on dining and 2% on groceries make this a valuable card for food purchases. Available in: CT, DC, DE, FL, MA, MD, ME, NC, NH, NJ, NY, PA, RI, SC, VA, VT

Compare up to 4 providers

Bottom line

For independent contractors and freelancers, the disruption caused by the coronavirus pandemic can cause a huge upheaval to financial stability. But there’s hope, as government help is on the way. And many companies around the US are hiring right now if you’re looking for even more immediate financial security.

Plus, you can check out our guide to managing your finances during the pandemic for steps you can take today.

Frequently asked questions

Commonly asked questions about how to get help during the coronavirus as a freelancer.

What if I have kids and other dependents?

Typically, if you have financial dependents, the government will increase your benefits — up to the maximum dollar amount allowed.

What if I’m already receiving unemployment insurance benefits?

If you’re already receiving unemployment insurance benefits, the best thing you can do is tighten your budget and continue to look for employment. The stimulus package might contain additional aid for you in response to the coronavirus, but it doesn’t hurt to have more options lined up.

Can I qualify for a PPP loan if my net profits were $0 in 2019 or 2020?

Not if you work alone. Unless you have employees on payroll, you can’t qualify for a PPP loan if your net profits were $0 on your 2019 or 2020 taxes.

Picture: Getty Images

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