Vision Payroll

February 21, 2011

Massachusetts Freezes Unemployment Tax Rate Schedule for 2011

Filed under: News — Tags: , , , , , , , , , — Vision @ 6:08 pm
MA EOLWD Secretary Joanne F. Goldstein
Governor Deval Patrick recently signed legislation that will provide immediate relief to Massachusetts’ businesses by freezing employer contributions to the Unemployment Insurance (UI) Trust Fund at current levels. This new law prevents a scheduled rate hike from taking effect, helping to save businesses $402 million this year. Although the legislation freezes the rate schedule for 2011, individual employer’s rates may increase or decrease from 2010. The rate change is determined by the change in the employer’s Experience Rating.

Legislation Said to Position State for Continued Economic Recovery

“Without this legislation employers would have seen an average increase of $228 per employee,” said Governor Patrick. “We want to encourage a positive climate for employers and by signing this bill we are helping to position the state for continued economic recovery.”

Employer Contributions Tied to Trust Fund Levels

Employer contributions into the UI Trust Fund are tied to the amount of reserves in the trust fund. By law, a scheduled increase was triggered on January 1, 2011, which would have caused an increase in the average contribution per employee of $228 for 2011. In order to reduce costs for Massachusetts businesses, Governor Patrick and the Legislature agreed to freeze the contribution at a lower rate schedule (Schedule E). This measure will not impact benefit levels or eligibility for persons currently collecting unemployment benefits.

Notice of Employer’s Unemployment Insurance Contribution Rate for 2011 to Be Released

Now that the legislation has been passed, the Massachusetts Division of Unemployment Assistance (DUA) is expected to release through QUEST the Notice of Employer’s Unemployment Insurance Contribution Rate for 2011. This notice contains information on each employer’s contribution rates, including the following:

  • Unemployment Insurance (UI) Rate,
  • Universal Health Insurance (UHI) Rate,
  • Workforce Training Fund (WTF) Rate, and
  • Experience Rating

Contact Vision Payroll for Further Information

Contact Vision Payroll for further information on the unemployment tax rate schedule in Massachusetts for 2011.

February 20, 2011

Massachusetts Releases 2011 UHI Contribution Rates

Filed under: News — Tags: , , , , — Vision @ 8:29 am

The Massachusetts Division of Unemployment Assistance (DUA) has released the UHI contribution rates for 2011. According to MGL c. 151A, §14G(f):

There shall be a rate review board composed of the commissioner of medical assistance or his designee, the deputy director of employment and training or his designee and the commissioner of insurance or his designee. The rate review board shall determine if the unemployment health insurance contribution rate and the unemployment health insurance contribution wage base established in this section shall be adequate to provide for the estimated costs for the subsequent year of unemployment health insurance programs established pursuant to subsection (j) provided by said division of employment and training. If in the opinion of said board the unemployment health insurance contribution wage base or the unemployment health insurance contribution rate as established above would be inadequate to properly fund the unemployment health insurance program, said rate of health insurance inflation or the unemployment health insurance contribution rate shall be appropriately adjusted in order to properly fund said unemployment health insurance program.

On or before November 30 of each year, the deputy director of employment and training shall certify to said board the estimated costs for the subsequent year of health insurance programs provided by the division of employment and training for individuals and their families who are eligible for the health insurance program established by subsection (j) for individuals receiving unemployment insurance compensation. Such estimated costs shall be exclusive of amounts to be covered by premiums, co-payments, deductibles and co-insurance to be paid by covered individuals and any anticipated appropriations. The rate review board shall further adjust such estimated costs to reflect prudent levels of reserves sufficient to carry out the responsibilities of the division of employment and training for said unemployment health insurance program. If in the opinion of said board the rate of health insurance inflation on the unemployment health insurance contribution wage base as established or calculated above would be inadequate to properly fund said unemployment health insurance program, said rate of health insurance inflation or the unemployment health insurance contribution rate shall be appropriately adjusted in order to properly fund said health insurance programs.

2011 Rates to Increase for Most Employers

According to the DUA, for 2011 rates will be as follows:

The health insurance contribution rate is a flat rate of 0.36% for calendar year 2011 for all subject employers—except for those meeting the exempt or reduced rate criteria. (Employers operating within two calendar years following the “newly subject” status pay at rates of 0.04% and 0.08%, respectively.)

Contact Vision Payroll if you have any questions on the 2011 UHI contribution rates.

March 28, 2010

Massachusetts Releases 2010 UHI Contribution Rates

Filed under: News — Tags: , , , , — Vision @ 10:42 pm

The Massachusetts Division of Unemployment Assistance (DUA) has released the UHI contribution rates for 2010. According to MGL c. 151A, §14G(f):

There shall be a rate review board composed of the commissioner of medical assistance or his designee, the deputy director of employment and training or his designee and the commissioner of insurance or his designee. The rate review board shall determine if the unemployment health insurance contribution rate and the unemployment health insurance contribution wage base established in this section shall be adequate to provide for the estimated costs for the subsequent year of unemployment health insurance programs established pursuant to subsection (j) provided by said division of employment and training. If in the opinion of said board the unemployment health insurance contribution wage base or the unemployment health insurance contribution rate as established above would be inadequate to properly fund the unemployment health insurance program, said rate of health insurance inflation or the unemployment health insurance contribution rate shall be appropriately adjusted in order to properly fund said unemployment health insurance program.

On or before November 30 of each year, the deputy director of employment and training shall certify to said board the estimated costs for the subsequent year of health insurance programs provided by the division of employment and training for individuals and their families who are eligible for the health insurance program established by subsection (j) for individuals receiving unemployment insurance compensation. Such estimated costs shall be exclusive of amounts to be covered by premiums, co-payments, deductibles and co-insurance to be paid by covered individuals and any anticipated appropriations. The rate review board shall further adjust such estimated costs to reflect prudent levels of reserves sufficient to carry out the responsibilities of the division of employment and training for said unemployment health insurance program. If in the opinion of said board the rate of health insurance inflation on the unemployment health insurance contribution wage base as established or calculated above would be inadequate to properly fund said unemployment health insurance program, said rate of health insurance inflation or the unemployment health insurance contribution rate shall be appropriately adjusted in order to properly fund said health insurance programs.

According to the DUA, for 2010 rates will be as follows:

The health insurance contribution rate is a flat rate of 0.24% for calendar year 2010 for all subject employers—except for those meeting the exempt or reduced rate criteria. (Employers operating within two calendar years following the “newly subject” status pay at rates of 0.04% and 0.08%, respectively.)

Contact Vision Payroll if you have any questions on the 2010 UHI contribution rates.

September 18, 2009

Question of the Week: Why Do We Have To Pay Massachusetts HICA Tax This Payroll?

This week’s question comes from Michelle, a small business owner. I have not had to pay Massachusetts HICA tax all quarter. Now I have to pay it with the last payroll of the quarter. Why do we have to pay Massachusetts HICA tax this payroll? Answer: The Massachusetts Unemployment Health Insurance Quarterly Contribution (HICA) is required when the average employee count is six or greater for a quarter. Employers must pay contributions on the first $14,000 of each employee’s covered wages during the calendar year. The amount of the contribution is derived by multiplying these wages by an assigned rate. The health insurance contribution rate is 0.12% for most subject employers. Employers operating within two calendar years following the newly subject status pay at rates of 0.04% and 0.08% respectively. Contact Vision Payroll if you have any further questions.

May 1, 2009

Question of the Week: How Do I Determine My Tax Rate for Massachusetts Health Insurance Contribution Act Tax?

Filed under: News — Tags: , , — Vision @ 8:02 pm

This week’s question comes from Matt, a business owner. I received my unemployment rate from the Commonwealth of Massachusetts, but don’t remember receiving my rate for Massachusetts Health Insurance Contribution Act Tax. How do I determine my tax rate for Massachusetts Health Insurance Contribution Act Tax? Answer: Under Massachusetts General Laws c. 151A, §14G, Unemployment health insurance contribution; medical security trust fund, employers are effectively exempt from the tax for the first two calendar years they become subject to the tax, regardless of employee count. For the third calendar year, the rate is 0.04%, for the fourth calendar year, the rate is 0.08%, and for the fifth and subsequent years, the rate is 0.12%. Employers must pay this tax on subject wages up to $14,000 per year per covered employee. Contact Vision Payroll if you have questions on the Massachusetts Health Insurance Contribution Act.

April 24, 2009

Question of the Week: Am I Required to File Massachusetts Form 1700-HI?

This week’s question comes from Carolyn, a business owner. I recently hired some new employees. Am I required to file Massachusetts Form 1700-HI? Answer: Employers in Massachusetts should count the number of employees who worked or received pay for any part of the pay period that includes the twelfth of the month for each of the three months in the quarter. If the sum of those three numbers is eighteen or more, then the employer is required to file Form 1700-HI and pay tax at the rate assigned by the Massachusetts Division of Unemployment Assistance. Contact Vision Payroll if you have any questions on Form 1700-HI, Health Insurance Quarterly Contribution Report.

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