Utah Businesses See Reduction in Unemployment Insurance Tax
June 16, 2014
Many Utah employers are seeing a reduction in Unemployment Insurance (UI) taxes thanks to the health of Utah’s Unemployment Compensation Fund. Much of the reduction—to the tune of $35 million dollars in 2014—comes from automatic downward adjustments when the fund has adequate reserves.
Employers pay into the UI program—administered by the Department of Workforce Services (DWS)—which pays benefits to workers who lost their jobs. The fund currently has $738 million, a significant improvement from the $253 million balance about three years ago. It has taken several years of strong economic growth to replenish the fund.
Utah, along with only 15 other states, was able to maintain the fund without borrowing over the last four years. Utah’s contribution rate formulas help build up the fund during economic growth to have in reserve in case of an economic downturn. As Utah’s economy continues to grow in the coming years, the fund should stay strong, which will likely trigger more reductions in the tax rate.
For more information, visit the Department of Workforce Services website.