Many employers likely to pay more unemployment taxes in 2012
Employers in many states are likely to pay more unemployment tax in 2012 than in previous years for a variety of reasons, including: (1) a higher federal unemployment tax (FUTA) rate because of outstanding federal loans; (2) a higher state taxable wage base; and/or (3) a higher state unemployment tax rate and new surcharges.
Alaska. The amount of wages subject to unemployment tax (i.e., the taxable wage base) has increased from $34,600 to $35,800. Unemployment tax rates have also increased.
Arkansas. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Arkansas' failure to repay its outstanding federal unemployment insurance (UI) loans for two consecutive years. Employers now pay an advance interest tax to help the State pay the interest on its federal UI loans.
Arizona. Unemployment tax rates have increased. Employers must pay a special assessment to help the State pay the interest on its federal UI loans.
California. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of California's failure to repay its outstanding federal UI loans for two consecutive years.
Colorado. The taxable wage base has increased from $34,600 to $35,800.
Connecticut. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Connecticut's failure to repay its outstanding federal UI loans for two consecutive years.
Florida. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Florida's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $7,000 to $8,500. Unemployment tax rates have also increased.
Georgia. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Georgia's failure to repay its outstanding federal UI loans for two consecutive years.
Hawaii. The taxable wage base has increased from $34,200 to $38,800. Unemployment tax rates have also increased, but could possibly be reduced by 2012 legislation.
Idaho. The taxable wage base has increased from $33,300 to $34,100.
Illinois. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Illinois' failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $12,740 to $13,560. The maximum unemployment tax rate has increased. The fund building rate has also increased.
Indiana. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.6% higher than it otherwise would have been because of Indiana's failure to repay its outstanding federal UI loans for three consecutive years. Employers now also pay a solvency surcharge because of the outstanding federal loans.
Iowa. The taxable wage base has increased from $24,700 to $25,300.
Kansas. Unemployment tax rates have increased for employers with negative reserve balances.
Kentucky. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Kentucky's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $8,000 to $9,000.
Maine. Unemployment tax rates have increased.
Michigan. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.9% higher than it otherwise would have been because of Michigan's failure to repay its outstanding federal UI loans for four consecutive years. Michigan has now repaid the federal UI loans, so employers will not pay a higher federal unemployment tax (FUTA) rate on their 2012 federal return (due in 2013). The taxable wage base has increased from $9,000 to $9,500.
Minnesota. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Minnesota's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $27,000 to $28,000. The new employer rate has increased. The federal loan interest assessment rate has increased.
Missouri. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Missouri's failure to repay its outstanding federal UI loans for two consecutive years.
Montana. The taxable wage base has increased from $26,300 to $27,000.
Nevada. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Nevada's failure to repay its outstanding federal UI loans for two consecutive years. A new tax rate schedule went into effect on Jan. 1, 2012 that revised the reserve ratio ranges in the 18 tax rate classes. Employers will pay more unemployment tax in 2012 even if their UI benefit experience is similar to what it was in 2011.
New Hampshire. The taxable wage base has increased from $12,000 to $14,000.
New Jersey. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of New Jersey's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $29,600 to $30,300. Unemployment tax rates increased beginning with the fiscal year that began on July 1, 2011.
New Mexico. The taxable wage base has increased from $21,900 to $22,400. Unemployment tax rates have also increased.
New York. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of New York's failure to repay its outstanding federal UI loans for two consecutive years.
North Carolina. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of North Carolina's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $19,700 to $20,400.
North Dakota. The taxable wage base has increased from $25,500 to $27,900.
Ohio. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Ohio's failure to repay its outstanding federal UI loans for two consecutive years.
Oklahoma. The taxable wage base has increased from $18,600 to $19,100.
Oregon. The taxable wage base has increased from $32,300 to $33,000.
Pennsylvania. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Pennsylvania's failure to repay its outstanding federal UI loans for two consecutive years.
Rhode Island. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Rhode Island's failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $19,000 to $19,600 for most employers. It has increased to $21,100 for employers who are in the highest unemployment tax rate bracket.
South Carolina. The taxable wage base has increased from $10,000 to $12,000.
South Dakota. The taxable wage base has increased from $11,000 to $12,000.
Utah. The taxable wage base has increased from $28,600 to $29,500. Unemployment tax rates have also increased, but could possibly be reduced by 2012 legislation.
Vermont. The taxable wage base has increased from $13,000 to $16,000.
Virginia. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Virginia's failure to repay its outstanding federal UI loans for two consecutive years. Unemployment tax rates have also increased.
Virgin Islands. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of the Virgin Islands' failure to repay its outstanding federal UI loans for two consecutive years. The taxable wage base has increased from $22,600 to $23,700.
Washington. The taxable wage base has increased from $37,300 to $38,200.
Wisconsin. The tax rate on the 2011 federal unemployment tax return due on Jan. 31, 2012 will be 0.3% higher than it otherwise would have been because of Wisconsin's failure to repay its outstanding federal UI loans for two consecutive years.
Wyoming. The taxable wage base has increased from $22,300 to $23,000.
