FIRST LOOK: Unemployment Tax Rates in 2019

By June 27, 2018Regional

It is hard to believe that we are approaching the end of the second quarter of 2018 and soon employers will receive unemployment tax rates for 2019.  Each year, the unemployment agencies calculate tax rates based on employers’ prior experience.  Experience is made up of multiple factors; taxable payroll, taxes paid, benefit payments for claims lost and reserve balance, to name a few.  While most states mail tax rates starting in November of any given year, a handful of states do so on a different time frame.

Fiscal Year States

Four states (New Hampshire, New Jersey, Tennessee, and Vermont) mail tax rates in the middle of a calendar year and are effective from July 1 through June 30.  These are referred to as being Fiscal Year states, meaning their tax rates are in effect during what is typically called a fiscal year as opposed to a calendar year.  Of these four states, only New Jersey offers employers the option to buy down rates for the upcoming year.  There are very strict deadlines for protesting or in the case of New Jersey, making the voluntary contribution so once past, the opportunity is missed.  Your dedicated UI Tax Analyst is skilled in the verification of tax rates on your behalf and will make certain you are made aware of all possible tax reductions.

California Pays its Title XII Loan

In May, California paid off its Title XII Loan for the first time in over a decade.  If the state retains its zero balance until November 10, 2018, the state’s employers should see a return to the minimum Federal Unemployment Insurance Act or FUTA rate of 0.60%.  At this time, estimates indicate California will be successful in this endeavor so employers should see their FUTA taxes return to the minimum allowed for the calendar year.  Currently, no other states have a Title XII loan.

As always, if there are any questions please do not hesitate to contact us.

Josh Kendall

Author Josh Kendall

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