With unemployment on the rise, almost every employer's contribution rate for unemployment taxes has gone up even though the employer's specific benefit ratio may have gone down. This is so because the overall rate is usually determined based on both the employer's specific benefit payouts and the state's overall payout, including surcharges to rebuild the state's fund after several years of high benefit payouts. Not only that, but the wage base the rate is applied to continues to increase.
This might be a great time to review these increases with FGMK's SALT specialists and determine what you can do to lower these taxes.
Even if you cannot or will not take time now to review your state unemployment experience rating, a review of unemployment taxes is a must when acquiring a business or starting a new one. Whether or not a new employer rate, successor rate, or some combination of either is applied depends on when and how much of a business' assets and employees are acquired. The spread between the minimum and maximum contribution rates could be 7%.
Here are some of the payroll and unemployment tax areas FGMK's SALT specialists can help you with:
- Independent contractor reviews
- SUTA refund studies
- Layoff management/planning
- Successor liability review