Why Are My Employer Payroll Taxes Going Up?
Your 2022 payroll taxes are probably going to increase in 2022 because of rising SUI tax rates.
State unemployment insurance (SUI) can sometimes be referred to as SUTA – State Unemployment Tax Act, reemployment tax, and unemployment benefits tax, but they all mean the same thing.
An SUI is a fund that pays out unemployment benefits, or wage replacements, to an employee who has lost their job, through no fault of their own that meet all of the eligibility requirements. These benefits are intended to provide temporary income as unemployed workers seek new employment.
SUI Tax Rates Rising
Why is State Unemployment Insurance tax rising? Because the COVID-19 pandemic is causing higher unemployment rates, state funds have been used up. And replenishing these funds will come from your higher employer payroll taxes.
SUI is a part of employer payroll taxes, which are made up of five different taxes:
① State Unemployment Insurance Taxes (SUI, aka: SUTA)
② Federal Unemployment Insurance Taxes (FUTA)
③ Medicare Taxes
④ Social Security
⑤ Local Taxes
COVID-19 has depleted many state unemployment insurance funds, so a number of states are increasing these taxes to replenish the funds. These increases can come in the form of:
Ⓐ Higher wage base limits
Ⓑ Higher percentages (tax rates) that are paid on the wage base limits, and/or
Ⓒ A combination of both
So, What Should You Do to Prepare for Higher Taxes?
The first step is figuring out what your SUI rate is, it is critical that you start paying the correct amount as soon as possible
How Do I Calculate My SUI?
To calculate your SUI tax, you multiply your SUI tax by the “wage base.” A wage base means you only pay tax on a set amount of each employee’s wages
How Do I Find Out the Wage Base Limit in my State and the Tax Rate for my Business?
New employers: your State agency will forward out a letter with your assigned SUI tax rate after you have registered your company as an employer with the State unemployment insurance agency or State department of labor.
Other employers: every year, you’ll get a new tax rate letter in the mail that tells you your rate for the year. Depending on the state, these are usually mailed out between November of the prior year and March of the effective year.
If you haven’t received your letter, contact your state agency (website and phone numbers are listed in the table below).
Once you have your SUI rate calculated, you will want to work with your accountant to budget and forecast appropriately for 2022. If you still have questions about State Unemployment Insurance or how to prepare for an SUI increase, feel free to email us at: [email protected] or fill out the contact form at the bottom of the page.
State | 2022 Wage Base Limit | 2021 Wage Base Limit | 2020 Wage Base Limit | State Agency Website and Phone Number |
Alabama | $8,000 | $8,000 | $8,000 | (334)242-8025 |
Alaska | $45,200 | $43,600 | $41,500 | (907)269-4700 |
Arizona | $7,000 | $7,000 | $7,000 | (877)600-2722 |
Arkansas | $10,000 | $10,000 | $7,000 | (501)682-2121 |
California | $7,000 | $7,000 | $7,000 | 1(800)300-5616 |
Colorado | $17,000 | $13,600 | $13,600 | (303)318-8000 |
Connecticut | $15,000 | $15,000 | $15,000 | (203)941-6868 |
Delaware | $16,500 | $15,000 | $15,000 | 1(800)794-3032 |
D.C. | $9,000 | $9,000 | $9,000 | (202)724-7000 |
Florida | $7,000 | $7,000 | $7,000 | 1(833)352-7759 |
Georgia | $9,500 | $9,500 | $9,500 | 1(877)709-8185 |
Hawaii | $51,600 | $47,400 | $48,100 | Oahu: (808)586-8970 Hilo: (808)974-4086 Kona: (808)322-4822 Maui: (808)984-8400 Kauai: (808)274-3043 |
Idaho | $46,500 | $43,000 | $41,600 | (208)332-8942 |
Illinois | $12,960 | $12,960 | $12,740 | 1(800)244-5631 |
Indiana | $9,500 | $9,500 | $9,500 | 1(800)891-6499 |
Iowa | $34,800 | $32,400 | $31,600 | 1(866)239-0843 |
Kansas | $14,000 | $14,000 | $14,000 | 1(800)292-6333 |
Kentucky | $10,800 | $11,100 | $10,800 | (502)875-0442 |
Louisiana | $7,700 | $7,700 | $7,700 | Louisiana Workforce Commission 1(866)783-5567 |
Maine | $12,000 | $12,000 | $12,000 | 1(800)593-7660 |
Maryland | $8,500 | $8,500 | $8,500 | Contact Info |
Massachusetts | $15,000 | $15,000 | $15,000 | 1(877)636-6800 |
Michigan | $9,500 | $9,500 | $9,000 | |
Minnesota | TBD | $36,000 | $35,000 | Minnesota Unemployment Insurance 1-877-898-9090 |
Mississippi | $14,000 | $14,000 | $14,000 | 601-321-6000 |
Missouri | $11,000 | $11,000 | $11,500 | |
Montana | $38,100 | $35,300 | $34,100 | Montana Unemployment Insurance Division 406-444-2545 |
Nebraska | $9,000 | $9,000 | $9,000 | 855-995-8863 |
Nevada | $36,600 | $33,400 | $32,500 | |
New Hampshire | $14,000 | $14,000 | $14,000 | New Hampshire Workforce Connect 1(800)852-3400 |
New Jersey | $39,800 | $36,200 | $35,300 | |
New Mexico | $28,700 | $27,000 | $25,800 | |
New York | $12,000 | $11,800 | $11,600 | 1(888)581-5812 |
North Carolina | TBD | $26,000 | $25,200 | 1(888)737-0259 |
North Dakota | $38,500 | $38,500 | $37,900 | (701) 328-4995 |
Ohio | $9,000 | $9,000 | $9,000 | Ohio Department of Job and Family Services 1(877)644-6562 |
Oklahoma | $24,800 | $24,000 | $18,700 | 1(800)555-1554 |
Oregon | $47,700 | $43,800 | $42,100 | 1(877)345-3484 |
Pennsylvania | $10,000 | $10,000 | $10,000 | Pennsylvania Office of Unemployment Compensation Contact Info |
Rhode Island | TBD | $26,100 | $25,500 | (401)415-6772 |
South Carolina | $14,000 | $14,000 | $14,000 | South Carolina Department of Employment and Workforce 1(866)831-1724 |
South Dakota | $15,000 | $15,000 | $15,000 | South Dakota Department of Labor & Regulation (605)626-2452 |
Tennessee | $7,000 | $7,000 | $7,000 | Tennessee Department of Labor & Workforce Development 1(877)813-0950 |
Texas | $9,000 | $9,000 | $9,000 | 1(800)628-5115 |
Utah | $41,600 | $38,900 | $36,600 | (801)526-9675 |
Vermont | $15,500 | $14,100 | $16,100 | 1(877) 214-3332 |
Virginia | $8,000 | $8,000 | $8,000 | |
Washington | $62,500 | $56,500 | $52,700 | Washington Employment Security Department 1(800)318-6022 |
West Virginia | $12,000 | $12,000 | $12,000 | 1(800)379-1032 |
Wisconsin | $14,000 | $14,000 |
| Wisconsin Department of Workforce Development (608) 266-3131 |
Wyoming | TBD | $27,300 |
| (307)473-3789 |
[form id="8639" /]
Written by Gentry DeWinter
Gentry graduated from Grand Valley with a Bachelor’s Degree in multi-media journalism. She is an artist who loves videography, writing, and hopes to one day own multiple dogs.