Bookkeeping services near me

Small businesses were hit hard by COVID-19, and even as these businesses start to get back on their feet, there continue to be challenges that make running a small business difficult. One such issue is the increase in unemployment taxes.

What taxes are being affected?

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Job loss due to COVID-19 virus pandemic

While there hasn’t been a change in the FUTA (Federal Unemployment Taxes), State Unemployment Taxes (SUTA) have started to increase rates, many of which have been significant. Many states said that they were not going to rate employers differently due to significant unemployment claims. However, these states have now started to increase the minimum and maximum rates for employers and have even gone so far as to make the rate increase retroactive to January 1, 2021.

How much will the increase in unemployment taxes affect my business?

While each state has different rates and every employer is rated based on their experience, the bottom line is that the increases in unemployment taxes significantly impact most employers. In New York State, the minimum rate was increased from .6% to 2.1%. Employers are required to pay SUTA in New York on the first $11,800 of wages for each employee. As a result, each employee’s minimum increased from $70.80 to $$247.80, or $177 per employee.

Who do I call for information about unemployment taxes?

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US Department of Labor HQ

The best place to start is with your payroll provider. When you call your payroll company, keep in mind that they are there to help and are not “charging” you more. They are simply passing through the cost of a payroll tax. Payroll companies can give you insights as to how much your rate has changed and how it will affect your business. For detailed information about why your business may be rated higher than the minimum, you should speak directly with the labor department in your state. Click here to view the New York State Department of Labor.

About Expex

Expex, based in Schenectady, NY, offers automated and innovative bookkeeping services to help your business succeed. Our application, Carly, can do everything a traditional bookkeeper does and more. This financial management program expertly delivers bill payments, bank and credit card reconciliation, and financial records consolidation. Call (518) 389-2305 today to get started, or contact us to learn more about Carly.

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