To have RGB on and the ability to mute the microphone when using the 3.5mm headphone jack, the headset has to be turned on or plugged into USB. The 3.5mm jack only supplies enough power to run the Speakers and it microphone. The headset needs to be on or plugged into usb to run the software to provide full functionality. The mic is muted via software and when the headset does not have a USB connection or is turned on the mic is set to on by default to prevent the mic being stuck on mute when the headset loses power.
TL;DR the headset needs to be turned on or have USB connection to have RGB and mic muting.