A number of states owe the federal government for loans from the federal jobless fund. Those loans become due in mid-November, and many states appear likely to default. If a state does not pay the loans back, the state’s credit against the Federal Unemployment Tax Act (“FUTA”) will be reduced.
In plain English, this means that contractors in AR, CA, CT, FL, GA, KY, MO, NV, NJ, NY, NC, OH, RI, AND WI could see increased FUTA costs of up to $62 per employee. Contractors in IN and SC could see an increased cost of up to $84 per employee, and up to $42 for contractors in AZ, DE, and VT.