Show When a new employer becomes liable for reemployment tax, the initial rate is .0270 (2.7%) and will stay at that rate until the employer has reported for 10 quarters. The account will then be rated by dividing the total benefits charged to the account by the taxable payroll reported for the first 7 of the last 9 quarters immediately preceding the quarter for which the rate is effective. The only exception is for employers liable by succession who choose to accept the tax rate of the previous employer, along with the responsibility of paying any outstanding amounts due. At that time, a tax rate will be calculated using the employment record and the rating factors, which are built into the Reemployment Assistance Law. The maximum tax rate allowed by law is .0540 (5.4%), except for employers participating in the Short Time Compensation Program. The 5.4% rate can be earned, or it can be assigned to employers who have delinquencies greater than one year and to those employers who fail to produce all work records requested for an audit. By law, an employer's tax rate may not be lower than .0010 (.1%). Rate notices are mailed to all contributing employers each year. Effective January 1, 2022, the minimum rate is .0010 (.10%). If you disagree with your tax rate determination, you may protest your tax rate within 20 days from the “Mailed on or Before” date printed on the Reemployment Tax Rate Notice (Form RT-20). Protests of the tax rate must be in writing and may be mailed, emailed, or faxed to the Department using the following contact information: Mail: Email: The minimum and maximum tax rates for wages paid in 2022 are as follows (based on annual wages up to $7,000 per employee):
You can view your tax rate by logging in to the Department’s Reemployment Tax file and pay website. How Rates are CalculatedThe reemployment assistance program is a federal-state partnership. Each state determines benefit qualification levels and amounts, benefit duration, disqualifications, and tax structure, within federal limits. For example, federal guidelines require each state to:
Each state sets tax rates, benefit levels, and trust fund balances based on that state's needs. Each state has its own benefit trust fund account within the U.S. Treasury. In Florida, the account is funded by a tax paid by employers. Florida assigns new employers an initial tax rate of 2.7%. This rate stays in effect for the first 10 quarters. At the end of this period, an employer has enough history to qualify for an experience-based tax rate. The formula for calculating the rate combines three major factors:
Ideally, each employer would pay the exact amount of reemployment assistance benefits that are chargeable to his or her account. This is not possible because the maximum contribution rate is 5.4%, and sometimes benefit payments are not charged to a specific employer. These added costs are divided among all rated employers through the variable adjustment factor and the final adjustment factor. Each employer's contribution rate is his or her benefit cost, plus a share of unassigned costs. This keeps the reemployment assistance program solvent. Reemployment Tax Rate Computation Effective 2021 through 2025Recent legislation changed Florida’s reemployment tax rate computation for rates effective 2021 through 2025 The new rate calculation for 2021 excludes all benefit charges from the second quarter of 2020 and prevents the application of the positive adjustment factor, which normally increases rates automatically if the trust fund balance is below a certain amount. Tax rates effective January 1, 2022, will exclude charges from the second, third and fourth quarters of 2020 and all benefit charges paid as a direct result of a government order to close or reduce capacity of a business due to COVID-19, as determined by the Department of Economic Opportunity. The tax rate calculation will also exclude the application of the positive adjustment factor (trust fund trigger). Tax rates effective January 1, 2023 through December 31, 2025, will exclude charges from the second, third and fourth quarters of 2020 and all benefit charges paid as a direct result of a government order to close or reduce capacity of a business due to COVID-19, as determined by the Department of Economic Opportunity. The tax rate calculation will also exclude the application of the positive adjustment factor (trust fund trigger). These changes to the tax rate calculation are repealed if the trust fund reaches $4,071,519,600 on June 1. Protecting Your Tax RateEmployers can help reduce tax rates by providing complete and accurate information needed to determine a claimant's eligibility for benefits. Improper payment of benefits is a serious problem that has a financial impact on employers. Here's how you can prevent improper payments and protect your tax rate:
Employers who do not comply with state and federal requirements for providing employee information risk higher costs through increased taxes, fines, or penalties. For questions about benefit eligibility and payment, contact the Florida Department of Economic Opportunity, Reemployment Assistance Program at 800-204-2418. How to Obtain Your Tax RateMandatory Transfer of ExperienceIf an employer transfers all or part of its business to another employer and, at the time of the transfer, there is any common ownership, management or control of the two employers, the unemployment experience attributable to the transferred business must be transferred to the employer to whom the business is transferred. (Note that Florida law defines “business” to include the employer’s workforce/employees). If the transfer was made with the intention of obtaining a lower reemployment tax rate (referred to as State Unemployment Tax Administration [SUTA] Dumping), a penalty rate of 2% of taxable wages shall be added to both employers’ rates for three years. In addition, an intentional violation of this provision makes it a felony of the third degree. PayrollingPayrolling is an agreement between employers where one employer agrees to report the payroll of another employer for reemployment tax purposes. Each employer maintains direction and control of their workers and the businesses do not change. The only change is that the payroll of one employer is reported to the Department by another employer for convenience. Florida law requires each legal entity to report only its own employees, therefore, payrolling is not permitted. It is essential under Chapter 443, Florida Statutes, that each employer report only its own employees to ensure the accuracy and integrity of the employer’s reemployment tax rate. How much is unemployment in Florida right now 2022?Florida Economic Indicators for June 2022 include:
Unemployment rate is 2.8 percent, down 0.1 percent from the revised previous month's rate and 0.8 percent lower than the national rate. Florida's statewide unemployment rate has been lower than the national rate for 19 consecutive months since December 2020.
How much is Florida unemployment right now?Florida Unemployment Rate is at 2.50%, compared to 2.70% last month and 3.90% last year. This is lower than the long term average of 6.15%.
|