Almost 6,000 millionaires collected unemployment benefits after COVID-19 crisis subsided

Thousands of millionaires were still collecting unemployment benefits even after the coronavirus emergency receded, according to new data released Wednesday.

Sen. Joni Ernst, the Iowa Republican who requested the report, said it was wrong for taxpayers to be covering the bills for families that clearly have the means to support themselves without relying on the government dole.

Nearly 15,000 people who reported incomes of at least $1 million to the IRS in 2021 also collected unemployment. The number slipped in 2022 as the pandemic’s effect on the economy waned, but there were still nearly 5,800 people with million-dollar incomes taking unemployment.

Between both years, they got roughly $270 million in government-funded assistance.

It’s a tiny fraction of the hundreds of billions in unemployment benefits paid out those two years, but Ms. Ernst said it’s the principle of the thing.

“Our nation’s safety net shouldn’t be strained by subsidizing the lifestyles of the self-sufficient. Yet, too many of the idle rich are living high off the hog, collecting government checks for not working, while at the same time earning a million dollars or more from some other side venture,” she said.

The average unemployment payout to millionaires in 2022 was $10,000. That was down from about $14,000 in 2021, when pandemic-boosted checks were still being cut in some instances, according to the data, compiled by the Congressional Research Service.

Ms. Ernst said the benefit is supposed to be a lifeline for those struggling after job loss.

Known officially as Unemployment Insurance, the benefits are a federal-state partnership. The feds oversee it, but each state runs its operation and provides the funding, based on a tax on employers.

The benefit is meant to help those who find themselves jobless through no fault of their own. And under a 1964 Labor Department ruling, states are forbidden from using someone’s income to deny them benefits.

The issue of high-income folks collecting benefits has roiled Washington for years.

In the wake of the 2008 financial collapse, then-Sen. Tom Coburn got his colleagues to pass legislation to bar those with million-dollar incomes from getting unemployment benefits. It cleared on a 100-0 vote in 2011, but the House took no action.

Instead, the House approved a plan to tax unemployment benefits for high-income taxpayers, rising to a 100% tax on those with a gross income of $1 million or more. That plan also failed to clear Congress.

That meant millionaires were still eligible to sign up when the pandemic struck and Congress rushed to pass incredibly generous new payment terms for the jobless.

Ms. Ernst has argued for the issue to be revisited.

CRS has cautioned that states might struggle to administer a program where they have to check incomes. And it warned that some people might not apply for benefits they are entitled to.

It’s also likely that some of the taxpayers in the data are joint filers where one spouse earned almost all of the million-dollar income and the other claimed unemployment.

For more information, visit The Washington Times COVID-19 resource page.