When starting out your new business, it is crucial to know that when you hire your first employee, they come with a great amount of expenses. There are certain taxes that you will need to pay, such as workers compensation, FICA taxes, and unemployment rates. This may seem exasperating, however, you have control of the unemployment tax rate in your new employee.
The responsibility to pay the expenses of unemployment taxes in Illinois are implemented by any of the following:
-The employer has paid at least $1,000 in cash wages for domestic work in a single calendar quarter.
-The employer has hired one or more persons for 20 weeks in a calendar year.
-A nonprofit organization hires four or more workers in 20 weeks in a calendar year.
-A local government source has paid any of the wages.
Once you are responsible for these expenses, the main interest is the rate of the tax you must pay. In addition, it is important to know how an organization with the help of its attorneys can help you minimize the rates.
How is Unemployment Rate Tax Found?
The expense the employer is going to have to pay is determined on how many employees receive unemployment benefits from the State of Illinois as an outcome of being terminated. If the amount of unemployment benefits increase, the employer’s tax rate will also increase.
How is Your Unemployment Tax Determined?
In the state of Illinois, the base rate of unemployment tax is found to be $12,960. For each individual employee, the employer is permitted to pay between $71.28 and $1,004.40 into the unemployment fund of Illinois. The unemployment rate in this year ranges from .550% and 7.350%, the tax may change annually, however, it is generally consistent with the amount of new businesses introduced.
Maduff & Maduff has practiced in employment law for over 20 years, contact our professional attorneys for more information or to review your case with unemployment tax rate today.