Unemployment Rates to be Issued Late for Businesses
Once again, the Massachusetts Division of Unemployment Assistance will be publishing the 2013 individual business unemployment rates late creating a great deal of hardship for small companies across Massachusetts. While the actual rates for 2013 were frozen by Governor Patrick on February 15, individual business rates still have not been published as of 3/1.
The DUA is currently advising employers on the Quest website that 2013 rate letters will be issued at some point during March. A representative of the DUA has informed BizChecks Payroll that rates will not be available until mid to late March.
Each employer’s unemployment tax rate is based on an “experience rating” determined by the DUA each year at the end of the third quarter of the prior year. The DUA maintains an account for each enrolled employer. Unemployment taxes paid in by employers are credited to their account and benefits paid to former employees are debited against their account. Each year on September 30th, the DUA balances employer accounts. The net balance of your account is divided by the total taxable wages paid to your employees to determine the “reserve percentage”. Your reserve percentage determines your tax rate for the following year.
Any individual business rate increases for 2013 will be retroactive to January 1st and will be due by April 30th. Last year many businesses were hit with large adjustments as a result of the rates being published the first week of April after the first quarter had already closed.
For additional information about your DUA rate and how to contest an increase, please check out this month’s Expert of the Month column by Laurie Drago, Director of Tax Compliance for BizChecks Payroll, at www.bizcheckspayroll.com.