If you were eligible for unemployment compensation as of Aug. 1, 2020, with a weekly benefit of at least $100, you may begin receiving an extra $300 per week soon if you are not receiving it already. The $300 stipend was authorized in an Aug.8, 2020, Presidential Memorandum issued by President Trump. It is officially referred to as Lost Wages Assistance (LWA) and is administered by the Federal Emergency Management Agency (FEMA).

CNBC reported that the Lost Wages Program was ended by federal officials Sept. 5, 2020, due to the depletion of funds. A FEMA spokesperson was quoted as saying that all states and territories that applied by the Sept. 10 deadline would receive six weeks of Lost Wages funding.

The Aug. 8 memorandum was in response to the end of the CARES Act $600-per-week unemployment boost, which expired July 31, 2020. Initially, the memorandum called for states to kick in an extra $100, raising the total weekly payment to $400. States complained that their depleted budgets did not allow for the extra payment, so the White House said that the first $100 of regular benefits paid by the state could count as the state's share.

Key Takeaways

  • The Lost Wages Assistance (LWA) program was enacted to provide $300 to $400 in extra pandemic-related compensation to unemployed and underemployed workers.
  • States and territories had to apply by September 10, 2020, in order to receive funds.
  • To be eligible you must have been unemployed August 1, 2020.
  • Funding was authorized through December 27, 2020, but was not expected to last beyond September 2020. It was ended Sept. 5.

Sources of Funding

According to the Aug. 8 presidential memo and subsequent DOL guidance, funds for the LWA program consisted of up to $44 billion from the Disaster Relief Fund (DRF). This amount is further limited by a directive that the DRF cannot fall below $25 billion. This funding is to provide 75% ($300 per week per claimant) of supplemental funds. The remaining 25% ($100) will come from states, either as an additional payment or as part of the claimant's regular unemployment stipend. 

States and Territories Must Apply

In order for you to receive LWA funds, your state or territory (also includes Washington D.C.) had to apply. States and territories had until September 10, 2020, to turn in that application.

FEMA maintains an updated list of approved states and territories on its Lost Wages Assistance Approved States webpage. Click on the link for your state to find out when it was approved and how much extra you can expect ($300 for most people, $400 for a small number of recipients).

Once a state or territory is approved, it's up to that state to come up with a plan to distribute payments to its citizens. Reporting indicates that Arizona, Louisiana, Missouri, Montana, Tennessee, and Texas are already sending out payments. Others are still working on a payment system.

How to Qualify and Apply

Not every unemployed person in every approved state or territory will receive LWA funds. To get the extra $300:

  • You must have been eligible for unemployment as of Aug. 1, 2020.
  • Your regular weekly unemployment benefit must be at least $100.
  • You must have become unemployed or had hours reduced due to the COVID-19 pandemic.

Beyond stated eligibility standards, it's up to each state or territory to decide what, if anything, you need to do to actually receive the money. Some states, such as Colorado and Rhode Island, require no action on the part of claimants. For most, however, what you may or may not need to do is unclear. Best advice is to check with your state unemployment office. 

States and territories (not FEMA) will run the LWA program. Most states have not announced how to apply or even if you will have to. Check with your state unemployment office for details.

How Long Payments Will Continue

No matter when you actually receive your first payment, the payment will be based on your employment status as of Aug. 1, 2020. Although LWA provides for payments starting as of Aug. 1 and running through Dec. 27, 2020. The program was designed to terminate sooner if:

  • FEMA spends the allocated $44 billion from the DRF account; or
  • The balance in the DRF account reaches $25 billion; or
  • COVID-19–related legislation is enacted that provides supplemental federal unemployment compensation or similar compensation to unemployed or underemployed individuals. 

Initial funding was for three weeks (Aug. 1–Aug. 22). According to FEMA, "After the initial three-week obligation, additional weekly disbursements will be made on a weekly basis in order to ensure that funding remains available. This is similar to the mechanism states/territories used to draw down Federal Pandemic Unemployment Compensation program funds."

Due to depleted funding, the Lost Wages program ended Sept. 5, 2020. However, according to CNBC, FEMA said any state or territory that applied for Lost Wages funding by Sept. 10, 2020, would receive six weeks funding for weeks ending Aug. 1 through Sept. 5.

One Check or Two

It's up to states and territories to decide how to make payment to individual claimants. You may receive one payment per week that includes both regular and LWA funds or you may receive two payments. States are responsible for accounting for LWA funds separately from regular unemployment benefits but do not have to pay separately.