If you are an employer with a work location in California or New York, you may be subject to additional federal unemployment tax (FUTA) for 2023.
These states had an outstanding federal loan balance for two consecutive years and failed to pay back the loans by the Nov. 10, 2023, deadline, so the FUTA credit will be reduced:
| Jurisdiction | FUTA credit reduction | Resulting FUTA rate | Additional tax (per EE) |
|---|---|---|---|
| California | 0.6% | 1.2% | Up to $42 |
| New York | 0.6% | 1.2% | Up to $42 |
The first payroll with a check date on or after Dec. 1, 2023, will include the additional FUTA payment for employees who work in the affected states.
If you do not plan to process any payrolls on or after Dec. 1, 2023, please contact your Payroll Specialist or Insperity Tax at IPS.Tax@insperity.com for assistance with a FUTA adjustment to ensure compliance.
For more information about these unemployment tax credit reductions, visit Federal Unemployment Tax Credit Reductions 2023 – Insperity HCM Knowledgebase.