Monthly Archives

November 2020

Unemployment Weekly Claims Report for the Week-Ending November 14, 2020

The Unemployment Insurance Weekly Claims report for the week ending November 14, 2020 has been released by the Department of Labor.

  • Seasonally adjusted initial claims: 742,000
  • 4 week moving average: 742,000
  • Seasonally adjusted insured unemployment rate: 4.3%
  • Seasonally adjusted insured unemployment number: 6,372,000
  • 4-week moving average: 7,054,500
  • Number of unadjusted claims: 743,460
  • Unadjusted insured unemployment rate: 4.2%
  • Unadjusted number claiming UI benefits: 6,081,402

The full news release report can be downloaded here.

 

Idaho Unemployment Tax Rates Decrease for 2021

The Idaho Department of Labor has confirmed that unemployment tax rates for 2021 are set to decrease.

Effective January 1, 2021, unemployment tax rates are to range from 0.207% to 0.691% for positive-rated employers and from 1.245% to 5.400% for negative-rated employers. In comparison, tax rates for 2020 ranged from 0.255% to 0.849% for positive-rated employers and from 1.527% to 5.400% for negative-rated employers.

The 2021 tax rates for experienced employers not assessed the maximum rate include a workforce development training-fund surtax that ranges from 0.00621% to 0.05808%.

The unemployment tax rate for new employers is to be 1.00% for 2021, unchanged from 2020.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.

Colorado Unemployment Tax Rates Set to Rise in 2021

The Colorado Department of Labor & Employment announced that unemployment tax rates are set to increase for 2021.

Effective January 1, 2021, unemployment tax rates for experience-rated employers are to range from 0.71% to 4.10% for positive rated employers and from 5.27% to 9.64% for negative rated employers. As a comparison, unemployment tax rates in 2020 ranged from 0.58% to 7.40%.

The unemployment tax rate for standard new employers will remain at 1.70% in 2021; unchanged from 2020.

The 2021 tax rate is to be 2.07%, up from 1.61%, for new construction of buildings (Code 236) employers; 7.74%, up from 5.94%, for new heavy and civil engineering construction (Code 237) employers; and 2.91%, up from 1.61%, for new specialty trade contracting (Code 238) employers.

Colorado’s unemployment taxable wage base will remain unchanged at $13,600 in 2021.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.

Federal Unemployment Tax Rates For 2020 & Beyond

The United States Department of Labor has confirmed that employers in the U.S. Virgin Islands are to pay higher payroll costs for 2020 because of a Federal Unemployment Tax Act credit reduction.

A FUTA credit reduction is to apply to the U.S. Virgin Islands because the jurisdiction had a loan balance from the federal unemployment account and was assessed a credit reduction for 2019.

For 2020, employers in the U.S. Virgin Islands are to be assessed a general FUTA credit reduction of 3% on wages paid to employees for work attributed to the jurisdiction.

The reduction is to cause employers to pay an effective federal unemployment tax rate of 3.60%, or up to $252 for each employee when applied to the federal unemployment taxable wage base of $7,000. This is impactful because the standard effective tax rate is 0.60%, or up to $42 per employee, because the maximum credit that may be applied to federal unemployment tax generally is 5.40%.

An additional credit reduction, the benefit-cost rate (BCR) add-on, could have been in effect for the U.S. Virgin Islands for 2020, but the US DOL approved the jurisdiction’s application for relief from the add-on. Approval of the relief allowed employers in the U.S. Virgin Islands to avoid a BCR add-on of 0.70%, a cost of up to $49 for each employee.

The credit reduction percentages are to be reaffirmed by the Internal Revenue Service on the 2020 Form 940 Schedule A, Multi-State Employer and Credit Reduction Information. Additional amounts due because of 2020 credit reductions are to be paid by February 1, 2021, which also is the due date for the 2020 Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return.

Potential Future Credit Reductions

Many states have borrowed federal funds to pay for the surge in unemployment benefit claims caused by the COVID-19 pandemic, but the federal unemployment tax impact may be delayed until 2022.

Twenty states have loan balances that did not have balances at the start of 2020, according to the Treasury Department’s Bureau of the Fiscal Service. The states are California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Illinois, Indiana, Kentucky, Louisiana, Massachusetts, Minnesota, New Jersey, New Mexico, New York, Ohio, Pennsylvania, Texas, Virginia, and West Virginia.

Maryland is authorized to borrow funds but does not have a balance.

For a state to be assessed a FUTA credit reduction, it must have a balance from the federal unemployment tax account on January 1st of two consecutive years and on November 10th of the year that the reduction would be assessed.

States that started borrowing in 2020 would be assessed a credit reduction of 0.30% for 2022 if balances remain January 1, 2021; January 1, 2022; and November 10, 2022, with the additional amounts due January 31, 2023. The credit reductions would raise federal unemployment tax costs per employee to $63 from $42 for employers in affected states.

Wage Bases Change for 2021

Modifications to unemployment taxable wage bases for 2021 have been acknowledged by 11 states thus far.

Wage bases are to increase in Arkansas, Iowa, Montana, Nevada, New Jersey, New York, Oklahoma, Washington, and Wyoming. Wage bases are to decrease in Missouri and Vermont.

Washington’s 2021 wage base, $56,500, is to be the highest unemployment wage base ever implemented.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.

South Carolina Unemployment Tax Rates Hold Steady for 2021

The South Carolina Employment Security Commission announced that unemployment tax rates are not to change for 2021.

Effective January 1, 2021, total tax rates for experience-rated employers not assigned the maximum tax rate are to range from 0.06% to 2.091%. The rates include base rates ranging from 0.00% to 2.031% and an administrative assessment of 0.06%.

The maximum tax rate for experience-rated employers is set at 5.46% for 2021.

The unemployment tax rate for new employers is the rate for experienced employers assigned to Rate Class 12, which is to be 0.55%. The rate includes a base rate of 0.49% and an administrative assessment of 0.06%.

South Carolina’s unemployment-taxable wage base is to remain at $14,000 in 2021, unchanged from 2020.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.

Unemployment Weekly Claims Report for the Week-Ending October 31, 2020

The Unemployment Insurance Weekly Claims report for the week ending October 31, 2020 has been released by the Department of Labor.

  • Seasonally adjusted initial claims: 751,000
  • 4 week moving average: 787,000
  • Seasonally adjusted insured unemployment rate: 5.0%
  • Seasonally adjusted insured unemployment number: 7,285,000
  • 4-week moving average: 8,244,500
  • Number of unadjusted claims: 738,166
  • Unadjusted insured unemployment rate: 4.7%
  • Unadjusted number claiming UI benefits: 6,951,731

The full news release report can be downloaded here.

Ohio Unemployment Tax Rates Set to Rise in 2021

The Ohio Department of Job & Family Services announced that unemployment tax rates are set to increase for 2021.

Effective January 1, 2021, the mutualized contribution tax rate is set to be 0.50% and is added to the experience-rated employers’ unemployment tax rates. The mutualized contribution tax rate, which was not in effect for 2020, will trigger on because unemployment benefits related to the COVID-19 pandemic were charged to the mutualized account instead of the individual employers.

Total unemployment tax rates for experience-rated employers are to range from 0.80% to 7.30% for positive-rated employers and from 7.40% to 9.80% for negative-rated employers. This is an increase from 2020 rates which ranged from 0.30% to 9.40%.

The total unemployment tax rate for delinquent experienced employers for 2021 is to be 12.30%, up from 11.80% in 2020.

The new-employer tax rate is to be 2.70% for 2021, unchanged from 2020. New employers in the construction industry are to be assessed a rate of 5.80% in 2021, also unchanged from 2020.

Ohio’s unemployment taxable wage base will remain at $9,000 for 2021.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.

Louisiana Unemployment Taxable Wage Base Remain Unchanged in 2021

As a result of legislation signed October 28, 2020 by Governor John Bel Edwards, Louisiana’s unemployment taxable wage base will not change for 2021.

Under the measure (S.B. 55), the unemployment taxable wage base is to remain at $7,700, effective January 1, 2021. This is because Procedure 2 is to be in effect for 2021 regardless of the balance of the state’s trust fund.

Procedure 2 generally is in effect for a year when the estimated trust fund balance for September 1st of that year is at least $750 million and less than $1.15 billion. The Louisiana Workforce Commission expects the trust fund balance to be less than $750 million, which would trigger Procedure 1 and a wage base of $8,500, according to SB 55’s fiscal note.

The measure also sets a maximum weekly unemployment benefit of $247 for 2021.

As always, if there are any questions please do not hesitate to contact us or visit our website at www.thomas-and-company.com.