Some 3,000 Millionaires Claim Jobless Benefits, IRS Data Show

http://www.bloomberg.com/news/2010-10-01/almost-3-000-millionaires-claimed-jobless-benefits-in-2008-irs-data-show.html

By Ryan J. Donmoyer - Oct 1, 2010 12:24 PM ET

After the economy slipped into recession in 2008, millions of Americans received unemployment benefits to make ends meet -- including almost 3,000 millionaires.

According to U.S. Internal Revenue Service data, 2,840 households reporting at least $1 million in income on their tax returns that year also collected a total of $18.6 million in jobless aid. They included 806 taxpayers with incomes over $2 million and 17 with incomes in excess of $10 million. In all, multimillionaires reported receiving $5.2 million in jobless benefits.

Those numbers are a minuscule fraction of the 9.5 million taxpayers who reported receiving $43.7 billion from jobless benefits in 2008, up from 7.6 million recipients reporting $29.4 billion in benefits in 2007. Still, economists said they are surprised so many people with seven-figure incomes claimed benefits.

“It’s a larger number than I would have expected,” said Alan Viard, resident scholar at the American Enterprise Institute, a Washington research organization. “But, people at any income level can lose their jobs.”

The first 26 weeks of unemployment benefits are paid by states. Nationally, benefits average about $300 per week. Because unemployment benefits are insurance, funded with taxes paid by employers, the program isn’t need-based like welfare. A millionaire who loses his or her job is entitled to benefits the same as a laid-off factory or restaurant worker, Viard said.

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In addition to the millionaires, 8,011 households reporting income between $500,000 and $1 million in 2008 claimed jobless benefits totaling $52.8 million, the IRS data show.

Few Millionaires

In 2007, so few millionaires collected jobless benefits that the IRS said it refused to publish the data for fear their identities could be detected in violation of confidentiality laws. In 2006, nearly 2,000 households reporting more than $2 million in income claimed jobless benefits, including 15 with incomes above $10 million.

No IRS data are available yet for 2009.

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