Answered on Feb 15, 2012
If someone takes steps toward self employment after they started receiving unemployment, they would become disqualified from receiving unemployment benefits. 43 P.S. 802 (2010); Voltz v. Commonwealth, 476 A.2d 492 (Pa. Commw. 1984).
Moreover, those who actively continue to receive benefits or conceal their self-employment could be liable for fault overpayments for the amount they improperly received if there is no mitigating factors for failing to disclose the self employment. Id. However, if the overpayment was not fault based, it may simply be recouped from future unemployment payments and not be required to payed back separately. 43 P.S. 874 (2010).
You should also know that, if someone is a self employed business person and their business fails, they would probably not be entitled to unemployment. Morelli v. Commonwealth, 434 A.2d 1332 (Pa. Commw. 1981).