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.

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Josh Kendall

Author Josh Kendall

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