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Proactively repay CERB?

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Proactively repay CERB?

So here's the situation. I applied for EI after I lost one job in March and had my hours and rate cut at the other. They gave me CERB. Shortly after I had my hours increased. I have since been making much less money than I had been pre-pandemic, but well over the $1k/month to qualify for CERB. I have been reporting all my income to EI and they keep giving me CERB payments. I have received $6k so far, it's sitting in a savings account.

It's not clear to me if I will have to repay all of the CERB, and will then be given the retroactive EI payments that I'd otherwise be eligible for. Or will they calculate the difference and bill me a partial repayment of that amount.

Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. Any insight or suggestions on what I should do?
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Kiraly wrote: So here's the situation. I applied for EI after I lost one job in March and had my hours and rate cut at the other. They gave me CERB. Shortly after I had my hours increased. I have since been making much less money than I had been pre-pandemic, but well over the $1k/month to qualify for CERB. I have been reporting all my income to EI and they keep giving me CERB payments. I have received $6k so far, it's sitting in a savings account.

It's not clear to me if I will have to repay all of the CERB, and will then be given the retroactive EI payments that I'd otherwise be eligible for. Or will they calculate the difference and bill me a partial repayment of that amount.

Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. Any insight or suggestions on what I should do?
I'd be inclined to just leave it. The federal government is not going to bringing any sort of monetary or criminal penalties for people who applied for CERB to which they were or were not entitled. At most, one will be instructed to repay, with interest if it's determined the person reasonably should've known they weren't entitled. The wording of the regulations and communications is so vague and wishy-washy, they can't possibly or reasonably do anything else.

In all likelihood, you will be seen as "duly entitled" by the automated algorithms showing your initial reduction in pay, and not have to repay any of it. If at that time, it still doesn't sit right with you, then you could use those funds, without fear of having to repay, by donating to one or more charities, small political parties, and the like, and receive a generous tax credit for doing so.

Cheers,
Doug
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Kiraly wrote: So here's the situation. I applied for EI after I lost one job in March and had my hours and rate cut at the other. They gave me CERB. Shortly after I had my hours increased. I have since been making much less money than I had been pre-pandemic, but well over the $1k/month to qualify for CERB. I have been reporting all my income to EI and they keep giving me CERB payments. I have received $6k so far, it's sitting in a savings account.

It's not clear to me if I will have to repay all of the CERB, and will then be given the retroactive EI payments that I'd otherwise be eligible for. Or will they calculate the difference and bill me a partial repayment of that amount.

Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. Any insight or suggestions on what I should do?
Actually you are suppose to pay CERB repayment to your 2020 installment acct. So you can pay anything you want into your installment acct.
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ml88888888 wrote: Actually you are suppose to pay CERB repayment to your 2020 installment acct. So you can pay anything you want into your installment acct.
@ml88888888 It doesn't say that. More problematic, though, your good-faith response doesn't really answer @Kiraly's question. The question, as I see it, is whether (a) Kiraly was entitled to CERB and (b) whether he is still entitled to it. I assume he's not continued to apply for any of the subsequent periods, so shouldn't be receiving anything from the periods which his hours normalized and he was making too much money per week to otherwise qualify. However, for the periods in which his hours dropped, he qualified. As long as his income wasn't above the allowable amount per week in subsequent weeks, he should be fine and not have to repay any of it. Even if he did ultimately have to repay it, I'm quite confident, since this was done in clear good-faith, he would simply repay, without interest and definitely without penalties, next year. Why expedite that repayment when it's not notionally required right now and so clearly to which he was good-faith entitled? Might as well earn a bit of interest on the funds, then repay it come income tax time next year. We tell people not to overpay their income taxes throughout the year; we tell them to underpay, if possible, such that they owe money at income tax time. This is no different.

Cheers,
Doug
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dmehus wrote: @ml88888888 It doesn't say that. More problematic, though, your good-faith response doesn't really answer @Kiraly's question. The question, as I see it, is whether (a) Kiraly was entitled to CERB and (b) whether he is still entitled to it. I assume he's not continued to apply for any of the subsequent periods, so shouldn't be receiving anything from the periods which his hours normalized and he was making too much money per week to otherwise qualify. However, for the periods in which his hours dropped, he qualified. As long as his income wasn't above the allowable amount per week in subsequent weeks, he should be fine and not have to repay any of it. Even if he did ultimately have to repay it, I'm quite confident, since this was done in clear good-faith, he would simply repay, without interest and definitely without penalties, next year. Why expedite that repayment when it's not notionally required right now and so clearly to which he was good-faith entitled? Might as well earn a bit of interest on the funds, then repay it come income tax time next year. We tell people not to overpay their income taxes throughout the year; we tell them to underpay, if possible, such that they owe money at income tax time. This is no different.

Cheers,
Doug
I think his main goal is this: 'Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. '. So he can use his AMEX to earn 4%.
[OP]
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ml88888888 wrote: I think his main goal is this: 'Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. '. So he can use his AMEX to earn 4%.
Ya but I don't want to do that if there's a chance that I might get to keep any of the money, and then I won't get it back. Just wanted to see if anyone has any insider info.
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ml88888888 wrote: I think his main goal is this: 'Normally I'd just do nothing and wait for instructions on what to do. But with Amex Platinum paying 4% for another two weeks, making a proactive repayment is enticing. '. So he can use his AMEX to earn 4%.
@ml88888888 I was confused by that because, for one thing, 4% return on, what, $8-12,000 for two weeks isn't that much. So, I basically just ignored that part of @Kiraly's original post as it wasn't germane to his main question.

@Kiraly, it seems like you're fine. Could use a few more details on dates and amounts and things, but otherwise, if you have to repay, you won't be penalized. No insider information; call it high degree of personal confidence.

Cheers,
Doug
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Kiraly wrote: Ya but I don't want to do that if there's a chance that I might get to keep any of the money, and then I won't get it back. Just wanted to see if anyone has any insider info.
if you do your tax, then you know that you will claim the installment on your next 2020 tax return. if you overpaid, then you will get a refund.
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ml88888888 wrote: if you do your tax, then you know that you will claim the installment on your next 2020 tax return. if you overpaid, then you will get a refund.
Not necessarily, @ml88888888. If @Kiraly repays the CERB now and is later deemed to have been eligible for it, he won't necessarily get it back like he would an income tax refund. I personally think it's better to keep it, let it earn interest, and pay back whatever is required (if anything) later. He's clearly a good-faith, responsible recipient.

Cheers,
Doug
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dmehus wrote: I'd be inclined to just leave it. The federal government is not going to bringing any sort of monetary or criminal penalties for people who applied for CERB to which they were or were not entitled. At most, one will be instructed to repay, with interest if it's determined the person reasonably should've known they weren't entitled. The wording of the regulations and communications is so vague and wishy-washy, they can't possibly or reasonably do anything else.
Although I do completely agree with you, the legislation Justin initially tabled was for prison sentences and steep fines...
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expresspotato wrote: Although I do completely agree with you, the legislation Justin initially tabled was for prison sentences and steep fines...
Yes, for people who applied for CERB fraudulently. I didnt apply for CERB fraudulently, in fact I didn’t even apply for it at all; I applied for EI and was given CERB anyway.
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whats this business about 4% on Amex Platinums?
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Kiraly wrote: Yes, for people who applied for CERB fraudulently. I didnt apply for CERB fraudulently, in fact I didn’t even apply for it at all; I applied for EI and was given CERB anyway.
I too am interested in this case. More so specifically when everything is said and done, how will the EI calculations work out.

@dmehus - Idk if you have any additional insight. The two things Im interested in, is say you were entitled to $573 a week and got $500 a week for CERB, will that $73 a week be owing when everything is settled in the end? Furthermore, in addition to this, as per the OP's case, for cases where you earned income and would receive a portion of your EI, will this all be calculated and settled in the end?

Based on not having a good idea of what's going to happen, or what the rules are, I would be inclined to wait and see what the government decides before randomly guessing at what we think will happen. That way thing's can be slightly less complicated when they are trying to calculate everything in the end.
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SubjectivelyObjective wrote: Based on not having a good idea of what's going to happen, or what the rules are, I would be inclined to wait and see what the government decides before randomly guessing at what we think will happen. That way thing's can be slightly less complicated when they are trying to calculate everything in the end.
That's what I have decided to do. I'll just wait, and let the CERB money earn interest in the HISA for now.
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The thing is I know people who qualify for EI because of partial job losses who don’t qualify for CERB as they still have some income so the government is avoiding that by giving everyone for now.
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expresspotato wrote: Although I do completely agree with you, the legislation Justin initially tabled was for prison sentences and steep fines...
@expresspotato I must've missed that passage in the legislation because I saw nothing of the sort.

Cheers,
Doug
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SubjectivelyObjective wrote: I too am interested in this case. More so specifically when everything is said and done, how will the EI calculations work out.

@dmehus - Idk if you have any additional insight. The two things Im interested in, is say you were entitled to $573 a week and got $500 a week for CERB, will that $73 a week be owing when everything is settled in the end? Furthermore, in addition to this, as per the OP's case, for cases where you earned income and would receive a portion of your EI, will this all be calculated and settled in the end?
No, I do not believe so, but having said that, EI has a longer maximum number of weeks (currently) than CERB so, in effect, you qualify for more money that way through EI. Also, you may be able to re-apply for EI after your CERB runs out, but am not 100% on that.

Hope that helps,
Doug
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badmus wrote: The thing is I know people who qualify for EI because of partial job losses who don’t qualify for CERB as they still have some income so the government is avoiding that by giving everyone for now.
I don't think that is the problem. You can still qualify for CERB even with only a reduction in hours. The reason the government likely did this is because it would unfairly bankrupt the Employment Insurance system for an economic shutdown that they ordered. Government should be providing all COVID-19-related income supports, not the Employment Insurance system which we've duly paid into.

Ideally, Employment Insurance should be managed out of a separate bank account, like the CPP Fund, instead out of an operating G/L account of the Consolidated Revenue Fund, and it should be managed by a third-party Crown agency, board, or corporation similar to CPPIB.

Cheers,
Doug

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