Video of the Week - 4/21/15
Gov. Scott Walker has declared a State of Emergency regarding drought conditions throughout the state.
News of the Day - 4/24/15
DWD Issues Positive UI Financial Outlook Report
The improving health of the state's Unemployment Insurance (UI) Trust Fund could trigger the activation of a lower UI tax schedule for covered employers for the first time since 2009, saving close to $100 million in UI taxes every year for tens of thousands of Wisconsin employers.
Some 134,000 Wisconsin employers who are covered by the state's UI program have been paying UI taxes based upon the highest UI tax schedule set forth under state law since 2009 due to Trust Fund borrowing during the Great Recession and its aftermath. Current projections call for the UI Trust Fund balance to exceed $300 million when the current fiscal year ends on June 30, which would trigger the next-lowest UI tax schedule for employers in calendar year 2016.
The state's move to the next lowest tax schedule will reduce the UI employer tax burden by an estimated $97 million per year.
"The economy is projected to grow throughout the period of 2015 through 2017 and correspondingly the UI Trust Fund is projected to continue to grow through the end of 2017, which is great news for employers who pay taxes into the fund," Department of Workforce Development (DWD) Secretary Reggie Newson said today. "The state's improving economy, coupled with the smart UI reforms that we've implemented in recent years, will build confidence among employers to expand and create more jobs."
The projections are included in the state's 2015 UI Financial Outlook report, which DWD submitted on April 15 to the Governor and state Legislature as required by statute.
Highlights of the report include:
- The Unemployment Insurance (UI) Trust Fund ended 2014 with a balance of $214 million. This is the first year since 2008 that the UI Trust Fund finished a year with a positive balance.
- The UI Trust Fund is expected to be over $300 million on June 30, 2015, moving Wisconsin's tax schedule to the next-lowest schedule. This move will reduce the employer UI tax burden by some $97 million per year, though an individual employer's savings will vary based on the tax bracket the employer falls into.
- The UI Trust Fund is meeting its benefit costs without having to borrow, allowing Wisconsin employers in good standing to receive the full Federal Unemployment Tax Act (FUTA) credit. This reduces the effective FUTA tax rate from 1.5% to 0.6%.
- UI benefits are expected to stay at historically low levels through 2017. UI tax revenue is expected to fall each year due in part to a change in the effective UI tax schedule and in part to the improvement of employer reserve fund balances.
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