Iowa unemployment insurance tax rates improve for 2013
Tuesday, September 04, 2012 2:39 PM
Employers will see about $100 million in tax savings next year because of an improvement in the state's Unemployment Insurance Trust Funds, with the average rate falling from 2.4 percent to 2 percent, according to Iowa Workforce Development.
"Our efficient, effective management of this trust fund will allow Iowa's employers more flexibility with their own dollars," Gov. Terry Branstad said in a news release. "This is $100 million that will be reinvested in Iowa's communities and is a clear sign that Iowa works to ensure that our valuable employers are successful in building Iowa's economy."
In 2010, the state increased the unemployment insurance by 50 percent to cover more than $1 billion in claims since November 2008, moving experience rated employers up two tax tables.
In 2013, the tax rates will move down from table four to table five. More than 52 percent of Iowa businesses will see a zero rate. Iowa is one of six states in the country to provide a zero rate within the tax tables. Additionally, the new employer non-construction rate will decrease from 1.5 percent to 1.1 percent.
Iowa Workforce Development is the state agency that collects unemployment insurance taxes from employers and identifies the appropriate tax table for the following year. Unemployment tax rates are based on wages and recent unemployment benefit payments.
"This is exciting news for Iowa businesses and the economy," said Iowa Workforce Development Director Teresa Wahlert. "While states across the country have struggled with the stability of their Unemployment Insurance Trust Funds, Iowa has moved the rates in a positive direction for businesses two years in a row."