COVID-19 and UI Benefits

Maryland Unemployment Tax Rate Calculations to Exclude COVID-19 Claims

The Maryland Department of Labor, Licensing & Regulation announced that unemployment tax rate calculations for 2021 are to exclude unemployment benefits claimed during the COVID-19 outbreak in a measure signed February 15, 2021 by Governor Larry Hogan.

Under the measure (SB 496), the computation date July 1, 2019, is to be used to determine an employer’s unemployment benefit ratio if using that date would result in a lower benefit ratio and a lower unemployment tax rate.  The provision takes effect starting with unemployment tax rate calculations for 2022 and expires June 30, 2025.

The adjustment would effectively exclude unemployment benefit claims data from fiscal years affected by the pandemic and prevent future tax rates from increasing because of those claims.  Tax rates for 2022 are to be determined using the same benefit ratios used to calculate tax rates for 2020.

The July 1, 2019 computation date also was used to determine tax rates for 2021 to exclude benefit data from fiscal 2020 and to allow employers to maintain the same benefit ratio for 2021 as in 2020, under an executive order signed December 10, 2020.

The measure also allows employers with fewer than 50 employees to defer sending unemployment tax and wage reports for the first, second, and third quarters of 2021, until the deadline for fourth-quarter reports, which is Jan. 31, 2022.

As always, if there are any questions please do not hesitate to contact us or visit our website at

Bipartisan Bill Introduced to Make the Work Opportunity Tax Credit Program Permanent

On February 8, 2021, a bipartisan bill named the Work Opportunity Tax Credit & Jobs Act was introduced by U.S. Senators Rob Portman (R-OH), Ben Cardin (D-MD), Roy Blunt (R-MO), Sherrod Brown (D-OH), Bill Cassidy (R-LA), and Bob Menendez (D-NJ) which would strengthen federal efforts to connect long-term unemployed with jobs.

The current program legislation is set to expire on December 31, 2025, but this bill would make an employer tax credit a permanent solution for those who hire individuals who face barriers to employment.

“Because of the ongoing COVID-19 pandemic, now more than ever individuals who are in the shadows are struggling to find meaningful employment”, said Senator Portman.  “Encouraging employers to hire those who have the most trouble finding work is good policy, and wile securing a five-year extension last year was a positive step, it’s critical that we make the Work Opportunity Tax Credit permanent.”

“The Work Opportunity Tax Credit is one of our best tools to promote the employment of those who find it hardest to get a job. But to be effective employers need the certainty a permanent extension provides and tens of thousands of families in Maryland need to know we have their back from now on,” said Senator Cardin. “That’s why we need to invest in this effective program permanently, to ensure those who need the most help are getting it.”

The Work Opportunity Tax Credit Program provides an employer tax credit of between $1,200 and $9,600 per employee for hiring and retaining individuals that are part of certain targeted groups representing populations that have a difficult time finding work, or are often out of the labor force altogether. The credit amount is based on the qualified wages paid to those employees within the targeted groups including veterans, long-term unemployed, ex-felons, the disabled, summer youth employees, as well as Temporary Assistance for Needy Families, Supplemental Nutrition Assistance Program, and Supplemental Security Income recipients.

“The COVID pandemic has hammered our nation’s economy, leaving millions out of work and small businesses struggling to survive,” said Senator Bob Menendez. “As we begin to recover from this crisis and build back an economy that works for all Americans, making the Work Opportunity Tax Credit permanent will provide certainty for employers to hire the long-term unemployed, veterans, and others who’ve been locked out of the workforce. We have both an economic interest and moral obligation to ensure that every individual has a fair shot in our economy to work hard, support a family and contribute to our society. Making this tax credit permanent is the smart and right thing to do.”

Last week, the U.S. Bureau of Labor Statistics reported that employers added 196,000 jobs in March, and the unemployment rate remained unchanged at 3.8 percent. However, the number of long-term unemployed people (those who were without jobs for 27 weeks or more) was essentially unchanged at 1.3 million in March and accounted for 21.1 percent of the unemployed.

“It can be difficult for Americans to find a job when they’re out of the work force,” said Dr. Cassidy. “This Work Opportunity Tax Credit permanency bill ensures those struggling to find work are helped by continuing to incentivize businesses to hire them.”

The bill has been sent to the Senate Finance Committee for further review and we are hopeful this permanent solution is underway.

As always, if there are any questions please do not hesitate to contact us or visit our website at

“Congress Passes $900 Billion in Pandemic Relief Package”

On December 21, 2020, Congress passed the second-largest economic rescue package in American history surpassing the $787 billion stimulus package passed in response to the financial crisis in 2009. This comes just behind the $1.8 trillion virus relief package that was signed into law earlier this year. The pandemic relief in conjunction with the omnibus spending bill totals more than $2.3 trillion and the vast package includes many tax benefits and provisions, energy provisions, national security provisions, and COVID-19 crisis related assistance.

As part of the Consolidated Appropriations Act, the “Continued Assistance for Unemployed Workers Act of 2021” bill language includes the extension of the CARES Act unemployment insurance provisions, specifically the Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC) programs until March 14, 2021. This bill provides an additional $300 per week in unemployment benefits for the next eleven weeks under the Federal Pandemic Unemployment Compensation (FPUC) program, extends the number of weeks of benefits an otherwise eligible individual may receive from 39 weeks to 50 weeks, and extends the funding of the first week of compensable regular unemployment for those states with no waiting week provision. The Families First Act received full federal funding of extended unemployment compensation and allows for short-time compensation under a short-time compensation program, plus financing, which was also extended to March 14, 2020.

In regard to tax provisions, the legislation provided a five-year extension of the Work Opportunity Tax Credit program through 2025, a five-year extension of Empowerment Zones through 2025, and a one-year extension of the Indian Employment Credit. Disaster Relief for 2020 through sixty days after date of enactment includes a tax credits of 40% of $6,000 in wages and this credit applies to wages paid regardless of whether services associated with those wages were performed.

The legislation provides for $22,318,000 from the Trust Fund to be allocated to the national activities of the Employment Service, including the administration of the Work Opportunity Tax Credit, which includes assisting State Workforce Agencies in adopting or modernizing information technology for use in the processing of certification requests and the provision of technical assistance and staff training under the Wagner-Peyser Act.

The package also includes an extended and enhanced Employment Retention Tax Credit (ERTC) that increases the credit from 50% to 70%, allows a credit against $10,000 for each quarter vs only one quarter, and increases the 100-employee delineation from 100 to 500. Employers who also qualified for Paycheck Protection Program (PPP) loans may still qualify for ERTC with respect to wages that are not paid for with forgiven PPP proceeds, as well as other changes.

The Paycheck Protection Program created in the Cares Act received an additional $284 billion as part of the package and allows loans to be fully forgiven if companies keep employees on their payroll. The legislation states that business owners can write off expenses paid for with forgiven PPP loans, which gives small companies a tax break that could amount to more than $100 billion.

Although many lawmakers supported larger stimulus payments, they were able to agree on a one-time direct stimulus payment of $600 to individuals and $600 per child. The payments are not eligible for those individuals making more than $75,000 or couples making $150,000 and these payments could begin processing as soon as next week. These will be distributed in the same fashion of the previous stimulus bill payments earlier in the year.

The legislation calls for other changes to the earned income tax credit and child tax credit to make it available to those who lost wages or jobs during the pandemic and expanded the Low-Income Housing Tax Credit increase construction of housing for low-wage families. Other tax impacts include an excise tax break for beer brewers, wine makers, and distillers and additional tax credits to help business in low-income communities.

The package includes many more measures such as $69 billion for the distribution of a coronavirus vaccine and more than $22 billion for states to conduct testing, tracing, and mitigation programs. It also provides $13 billion in nutrition assistance, $7 billion for broadband access, $45 billion for transportation and transit agencies, $82 billion in education funding, $25 billion in rental assistance, etc. and is expected to be signed later today by President Trump.

As always, if there are any questions please do not hesitate to contact us or visit our website at

COVID-19 Pandemic Relief Legislation: Update on the Extension (or Expansion) of the CARES Act

As both parties continue negotiations on continued virus relief, Republicans announced their own plan for a new U.S. virus-relief bill broadly endorsing a fresh round of stimulus checks to individuals, extended supplemental unemployment benefits and additional funding for COVID-19 testing while also voicing doubts over President Trump’s desire for a payroll tax cut.

The details remain in flux as GOP senators hashed out their opening bid in negotiations with Democrats on legislation to prop up the slowed U.S. economy. The differences between the GOP and the White House regarding the payroll tax cut threatens to push any action on the stimulus into August.

Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows started this week by saying their goal was to get a stimulus bill out of Congress by the end of next week (July 31st). But after getting pushback from Senate Republicans on several issues, including the payroll tax cut, both ended the day Tuesday dialing back expectations.

Mnuchin and Meadows met Tuesday (July 21st) over lunch with Republican Senators, but no outline for legislation emerged. Louisiana Republican Senator John Kennedy said the two Trump advisers discussed a lot of ideas, but “we haven’t reached a conclusion on anything.”

Democrat Senators Chuck Schumer and Nancy Pelosi said the lack of consensus among Republicans means real negotiations cannot start yet to bridge the differences between the GOP plan for $1 trillion in stimulus funds and the Democrats’ proposal for a $3.5 trillion package.

All the while, President Trump has expressed confidence that a deal will emerge saying “We’re working very hard on it, we’re making a lot of progress. I know that both sides want to get it done.”

The White House and Congress have only a few weeks to come up with another stimulus package before lawmakers take a scheduled August break and the $2.9 trillion flood of federal money passed by Congress earlier in the year begins to dry up.

The crux for Republicans is the President’s insistence on cutting or suspending the payroll tax paid by employers and employees, which funds Social Security and Medicare.

Mnuchin said it would be included in the Republican proposal, but some GOP senators, such as South Dakota’s John Thune, said they remain skeptical. Thune has stated “I’m not a fan of that. If it’s a choice between doing checks and payroll tax cut, I think it’s pretty clear the checks actually have a more direct benefit to the economy.”

Although Trump has suggested he might not sign a bill without the payroll tax cut, Mnuchin and Meadows indicated some flexibility in talks.

There are signs of a possible compromise on extending the supplemental unemployment insurance that was part of the stimulus measure passed in March and is set to expire on July 31st.

Section 2104 of the CARES Act provided individuals who were unemployed as a result of COVID-19, $600 a week in additional unemployment benefits, completely funded by the federal government. Republicans argued it created a disincentive for returning to work in some areas because unemployed individuals could get more than they earned at their jobs. Thus, some GOP lawmakers have floated the idea of lowering the supplement to $200 or $400 as part of the new package.

White House Press Secretary Kayleigh McEnany has said that the administration favors some type of additional unemployment aid, along with direct checks to individuals and a payroll-tax holiday for middle and low-income Americans.

Senate Majority Leader Mitch McConnell said the GOP plan will include a second round of the Paycheck Protection Program for small businesses, but it would be targeted to businesses most affected by the pandemic. He said there will be funding to reimburse businesses for the costs of safe workplaces, including personal protective equipment, virus testing, cleaning and remodeling to protect workers and entice customers. Additionally, there also will be money for some child-care assistance and funding for a vaccine. The Republican plan also will have $105 billion to aid schools in safely reopening.

As always, if there are any questions please do not hesitate to contact us or visit our website at

COVID-19 and Future Unemployment Tax Rates

As we all experienced in one way or another, many state unemployment agencies had difficulty managing the drastic increases in unemployment compensation claims arising from the COVID-19 pandemic. Just as state agencies are catching up with UI benefit payment issues, many are also having difficulty matching benefit charges with employer’s accounts. The additional $600 payment required under Section 2104 of the CARES Act and the state by state emergency orders issued for “non-charging” of employer accounts have created additional challenges in this regard and provided little time for state agencies to make changes in their systems to accommodate employers.

State unemployment taxes in 2021 and 2022 are likely to increase, whether it be due to individual employer’s experience history or a depletion in state unemployment trust funds. Regardless, employers and state agencies should be careful in reviewing charges to employer accounts to ensure compliance with federal and state laws.

In most states, contribution rates for 2021 are based on unemployment claims filed and benefits payments for the one-year period ending June 30, 2020. State agencies are now faced with the difficult task of reconciling the benefits paid with employer account charges identified for COVID-19-related claim payments. State unemployment compensation charge statements should be closely reviewed with respect to a number of questions related to federal and state laws and special COVID-19 related provisions, including but not limited to:

  1. The extra $600 paid as Federal Pandemic Unemployment Compensation (FPUC) under Section 2104 of the CARES Act should not be charged to employer accounts. This applies not only to the most recent separating employer accounts but also to non-separating base period only chargeable accounts. The $600 charge may not show up as a separate charge but may be included in total charges.
  2. Employer accounts should not be charged for unemployment compensation related to COVID-19 as provided in Executive Orders from Governors and/or state legislative bodies adopted to provide relief from COVID-19 related unemployment claims.

Requests for relief of charges should be submitted in a timely manner to state agencies to enable corrections to be made as early as possible and thereby avoid long-term impacts on future tax rate calculations.

Additionally, contribution rates for 2021 that are typically released between November & February should be reviewed for timely appeal. In the event that any discrepancy is identified, an issue should be raised immediately to avoid erroneous factors used in tax rate assignment.

Unfortunately, the delay in payment of unemployment compensation and the complex programming required for proper charging of employer accounts may take time to sort out by state agencies. Even if there is non-charging of benefits to individual employer accounts due to COVID-19, there may also be increases in 2021 and 2022 due to the impact of lower average payroll used to determine rates. The extent of additional taxes for 2021 may not be determined until the end of 2020. Employers and states should be working through these details to assure that the appropriate charges, payments and contribution rates are determined under the applicable laws.

The last point to consider relates to additional increases in UI taxes specifically relating to federal unemployment taxes (FUTA). Many state UI trust funds have been depleted and this may trigger solvency tax increases and interest on Title XII federal loans in years to come. Our office is monitoring this matter, as we did during The Great Recession, and will continue to provide updates on this as they become available.

As always, if there are any questions please do not hesitate to contact us or visit our website at

Wisconsin To Waive Unemployment Benefit Charges

The Wisconsin Department of Workforce Development has announced that it will not include unemployment benefits charged from March 15, 2020 to June 30, 2020 when calculating employer’s unemployment tax rates for 2021.

Under Emergency Rule 2018, published June 29th in the state administrative register, the Department is to assume that all benefits charged from March 15 to June 30 are related to the COVID-19 pandemic for purposes of calculating 2021 tax rates.

The calculation of an employer’s 2021 tax rate generally would include benefits charged up to June 30, 2020, but Wisconsin Act 185 signed in April requires virus-related benefits to be charged to the state unemployment balancing account instead of to individual employers.

The Department has indicated that redirecting the charges from employer’s accounts to the general balancing account will have to be completed manually and is expected to take thousands of hours. The process is not completed by June 30th because of the high volume of benefit claims, so the rule is to allow the Department to avoid charging employers for virus-related benefits in 2021.

As always, if there are any questions please do not hesitate to contact us or visit our website at

Washington Unemployment Taxable Wage Base to Rise in 2021

The Washington Department of Employment Security announced today that the unemployment taxable wage base is set to rise to $56,500 in 2021, up from $52,700 in 2020.

The change to the taxable wage base takes effect Jan. 1, 2021.

The Department’s unemployment tax rates for 2021 are expected to be finalized in December.


As always, if there are any questions please do not hesitate to contact us or visit our website at

COVID-19 & Hawaii Unemployment Tax Payment Extension

Hawaii’s deadline for submitting first-quarter unemployment tax payments will be extended, the Hawaii Department of Labor & Industrial Relations announced today.

Unemployment tax and wage reports will remain due on April 30, 2020 as normal, but the Department is allowing for an extension to submit the tax payment until May 31, 2020.

The Department stated that the deadline for unemployment tax payments was moved to May 31st  to assist employers during the COVID-19 pandemic.


Our office will be monitoring these situations closely and will send out additional announcements or make postings on our website ( as we become aware of new developments.

The CARES Act & the Florida Department of Economic Opportunity

Executive Order:

Florida’s governor signed Executive Order 20-104. This order suspends the biweekly “actively seeking work” reporting requirement for those seeking unemployment benefits.

Reemployment Assistance Processed Claims:

From March 15, 2020 to April 15, 2020, the state notes that 141,451 claims went through the initial monetary determination process, which means that a decision has been made on whether individuals are monetarily eligible to receive reemployment assistance.

Reemployment Assistance Claims Paid:

From March 15, 2020 to April 15, 2020, the Florida Department of Economic Security issued 121,102 payments to individuals in reemployment assistance, totaling $47,544,993. This includes 33,623 individuals who applied for reemployment assistance benefits after March 15, 2020.

For the week of April 17, 2020, a total of 23,801 checks for $600 were sent to individuals through the CARES Act. These checks were sent via paper to ensure they were distributed as quickly as possible. Please be aware that any individuals who received their $600 check will receive their state benefits for reemployment assistance via direct deposit or prepaid debit card based on the preference selected in the application process.

Reemployment Assistance Initial Claims:

Statistics on initial claims filed for reemployment assistance are below.

  • For the week ending March 21, 2020, the state received 74,313 applications.
  • For the week ending March 28, 2020, the state received 228,484 applications.
  • For the week ending April 4, 2020, the state received 169,885 applications.
  • For the week ending April 11, 2020, the state received approximately 175,306 applications.

CARES Act Update:

Pandemic Unemployment Assistance (PUA) provides benefits to those that may not be eligible for regular benefits, including individuals who are self-employed or independent contractors. The state is expected to provide additional information on PUA within the week.

System Enhancements:

The state announced that they will conduct routine maintenance to their CONNECT system to help with processing claims. Therefore, CONNECT will be unavailable from 8pm to 8am, daily. Any individuals who need to certify must log into CONNECT between 8am and 7:59pm, and log into the system during their scheduled reporting time, to have their claims processed in a timely manner. However, this maintenance will not affect anyone that needs to file a new claim. The CONNECT system will be available for new claims 24/7.

For more information about benefits, including how to apply and frequently asked questions, please visit the state’s website at


Our office will monitor COVID-19 updates closely and will send out additional announcements as we become aware of any updates. You can also review these updates on our website at too.

Please reach out to your representative with any questions.

The CARES Act & the Alaska Department of Labor & Workforce Development

The Alaska Department of Labor and Workforce Development started to issue the new $600 federal pandemic unemployment compensation to individuals impacted by COVID-19. The state notes that their first federal disbursement included $12,853,200 to 16,183 individuals currently covered by their current unemployment program.

Also, the state advised that the federal pandemic unemployment payment will be retroactive to the week ending April 4, 2020 and that the payment will be in addition to regular benefits. Individuals who have received benefits for week ending April 4, 2020, will receive a separate disbursement with the additional $600 payment. The payment will be available for each week of eligibility through July 25, 2020.

Finally, the state will begin to process applications for self-employed, independent contractors and gig economy workers on the week of April 20, 2020, with payment being issued about two weeks later. Individuals who previously filed and received ineligibility notifications will be contacted for income verification to complete their application process. The state notes that payment will be retroactively made to the week ending April 4, 2020.


Our office will monitor COVID-19 updates closely and will send out additional announcements as we become aware of any updates. You can also review these updates on our website at too.

Please reach out to your representative with any questions.