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Submission: On September 30 via api from FI — Scanned from FI
Submission: On September 30 via api from FI — Scanned from FI
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Skip to main content Post a job Find resumes Help Center Sign in Find jobs Post a job Find resumes Visit Indeed for job seekers Start of main content * Using Indeed * Using Indeed * Updates & New Features * Recruiting & Hiring * Recruiting & Hiring * Finding Employees * Screening & Vetting * Interviewing * Hiring & Onboarding * Hiring Guides by Title * Interview Questions by Title * Hiring Guides by City * Workforce Management * Workforce Management * HR Policies * Company Culture * Benefits & Perks * Leadership & Team Management * Managing your Business * Managing your Business * Starting your Business * Accounting * Taxes * Marketing & Sales * HR Software * Job Descriptions * Hiring by Industry * Food & Beverage * Finance & Accounting * Retail * Healthcare * Management More * Using Indeed * Using Indeed * Updates & New Features * Recruiting & Hiring * Recruiting & Hiring * Finding Employees * Screening & Vetting * Interviewing * Hiring & Onboarding * Hiring Guides by Title * Interview Questions by Title * Hiring Guides by City * Workforce Management * Workforce Management * HR Policies * Company Culture * Benefits & Perks * Leadership & Team Management * Managing your Business * Managing your Business * Starting your Business * Accounting * Taxes * Marketing & Sales * HR Software * Job Descriptions * Hiring by Industry * Food & Beverage * Finance & Accounting * Retail * Healthcare * Management More Search for a resource Post a Job LET'S CREATE YOUR ACCOUNT Already have an account? Sign in Company name Please enter your company name. Email Please enter your email address. Please enter a valid email. Continue By creating an account, you agree to Indeed’s Terms of Service, Cookie Policy and Privacy Policy. You consent to receiving marketing messages from Indeed and may opt out from receiving such messages by following the unsubscribe link in our messages, or as detailed in our terms. * Home * Hiring resources * What is State Unemployment Insurance? On This Page * What is SUI and what is it used for? * Who qualifies for SUI benefits? * Do employees have to pay SUI taxes? * How much do employers have to pay in SUI taxes? * How should state unemployment taxes be paid? * What companies are exempt from paying SUI? * Are SUI and SUTA the same? * What’s the difference between the Federal Unemployment Tax Act (FUTA) and SUI? * Hiring inhouse help WHAT IS STATE UNEMPLOYMENT INSURANCE? If you’re a small- or medium-sized business, it’s important to understand your tax obligations as an employer. That includes state unemployment insurance (SUI). Keeping up to date on state and federal guidelines can help you stay compliant and reduce your risk of incurring unnecessary penalties. Learn the basics of SUI, including who qualifies for benefits, the distinctions between SUI, SUTA and FUTA, and how you can calculate your potential premiums. Post a Job Are you a job seeker? Find jobs. WHAT IS SUI AND WHAT IS IT USED FOR? State unemployment insurance (SUI) is a program that provides temporary financial assistance for employees who have lost their job and are actively seeking new employment. This employer-funded state benefit is designed to cover the worker’s basic needs until they find another job. Although SUI guidelines are established under federal law, each state maintains a separate program. Eligibility requirements, benefit amounts and the duration of benefits may vary among states. WHO QUALIFIES FOR SUI BENEFITS? To qualify for this benefit, an employee must have been terminated due to a lack of available work or otherwise through no fault of their own. Depending on state guidelines, that may include workers who are laid off if their skill set is found lacking. Workers who are terminated for misconduct are not eligible for SUI benefits. If an employee quits their job, they’re generally not eligible to file for SUI. However, depending on the state, a worker who quits due to health reasons may be eligible for SUI benefits. Workers must be actively seeking new employment to qualify for SUI benefits. In some states, exceptions are made for workers who’ve left their jobs due to poor health. DO EMPLOYEES HAVE TO PAY SUI TAXES? In most states, funding for the state unemployment insurance program comes exclusively from employer-paid payroll taxes. Only three states — Alaska, New Jersey and Pennsylvania — require employees to contribute to SUI taxes and even in those states, employee contributions are minimal. If an individual state requires employee contributions for SUI, the employer should withhold the applicable amount from the worker’s paycheck. This money should then be paid to the state in quarterly payments. HOW MUCH DO EMPLOYERS HAVE TO PAY IN SUI TAXES? SUI tax rates vary widely by state and individual company, currently ranging from a minimum of zero in Iowa, Mississippi, Missouri and Washington, to a maximum of more than 20% in Arizona. Rates may differ from year to year due to periodic updates. Overall tax rates are usually based on some or all of the following factors: * The state’s wage base * The type of industry and its turnover rate * The company’s experience level as an employer * How many of the company’s former employees have filed for unemployment benefits For example, a company that’s had many former employees file for unemployment benefits will have a higher tax rate than a company that’s had fewer former employees file for benefits. New employers may also receive lower rates than companies with more experience. States typically provide companies with a yearly assessment, which determines your rate. If you want more information, your state’s workforce agency can provide further details about your tax rates. When you call, ask to speak with the agency’s Employment Security Tax division. If you want to calculate your potential premiums, simple SUI calculators, such as the Paychex State Unemployment Insurance Calculator, are available online. Most calculators require the following information to generate an estimate: * Number of employees * Average annual salary of workers * The state where your business is based * Your state’s SUI rate HOW SHOULD STATE UNEMPLOYMENT TAXES BE PAID? State unemployment taxes are usually paid quarterly. After you’ve estimated your tax liability, you should make a payment directly to the state, using your employer identification number (EIN) to identify your company. For additional information on payments, you can contact your state’s workforce agency. WHAT COMPANIES ARE EXEMPT FROM PAYING SUI? Although most companies are required to pay SUI taxes in states where they employ workers, there are several exceptions: * Charitable organizations: Although laws vary by state, 501(c)(3) charitable organizations are typically exempt from the SUI tax. These organizations are also exempt from the Federal Unemployment Tax Act (FUTA) tax. * Small businesses: Some states don’t require SUI taxes from businesses that employ only a few workers. In addition, employers don’t have to pay state unemployment insurance tax for workers under the age of 21. Your state’s tax commission can provide more information on potential SUI exemptions and what they mean for your business. ARE SUI AND SUTA THE SAME? SUI and SUTA are different names for the same program, which provides income for workers who have lost their jobs through no fault of their own. SUTA, which stands for State Unemployment Tax Act, exists in all states, but it may have different names. In many states, it’s known as State Unemployment Insurance or the SUI tax. In Florida, for example, it’s called the Reemployment Tax. WHAT’S THE DIFFERENCE BETWEEN THE FEDERAL UNEMPLOYMENT TAX ACT (FUTA) AND SUI? The Federal Unemployment Tax Act (FUTA) is the federal equivalent of SUTA or SUI, which are paid at the state level. FUTA taxes, which are also paid by employers, fund the federal government’s oversight of state unemployment insurance programs. Plus, during periods of high unemployment, a state may borrow FUTA funds to cover benefits for unemployed workers in their state. HIRING INHOUSE HELP Understanding tax obligations and how they affect payroll can be challenging for SMBs who don’t have experience with state unemployment insurance and other ER taxes. Adding knowledgeable tax or HR professionals to your team can streamline the process for your business. Whether you hire a payroll specialist or consult with a tax accountant, make sure you find someone well-versed in the ins and outs of SUI, SUTA and FUTA so that you can stay compliant. Post a Job Are you a job seeker? Find jobs. READY TO GET STARTED? Post a Job RECOMMENDED RESOURCES Medicare Taxes: An Overview for Employers Small Business Insurance: What Policies Do You Need? What Is the Accounting Equation? Equity, Assets and Liabilities RECENT BUSINESS ACCOUNTING ARTICLES * How to Do Payroll: A Guide to Running Payroll in the Midst of COVID-19 * Profit Sharing: A Guide to Sharing Profits with Employees * Financial Management: Basics for Business Managers * Different Accounting Professions: Key Titles and Duties * What Is a Pay Card: A Guide for Employers See all Business accounting articles * Home * Hiring resources * What is State Unemployment Insurance? *Indeed provides this information as a courtesy to users of this site. Please note that we are not your recruiting or legal advisor, we are not responsible for the content of your job descriptions, and none of the information provided herein guarantees performance. We're here to help Visit our Help Center for answers to common questions or contact us directly. 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