Tax News Update    Email this document    Print this document  

May 18, 2021
2021-1010

Delaware reissues 2021 SUI tax rate notices; 2021 SUI tax rates retroactively lowered

Recently enacted legislation (HB 65/Chapter 2) freezes the 2021 state unemployment insurance (SUI) tax rate schedule at the same as was in effect for 2020. (Governor John Carney's news release; HB 65 fiscal note.)

As a result, the 2021 SUI tax rates continue to range from 0.3% to 8.2%. New non-construction employers pay at 1.8%, construction employers at 2.3%. (Delaware Department of Labor website.)

The Delaware Division of Unemployment had originally issued the 2021 SUI tax rate notices in December 2020, which reflected an increase in the SUI tax rates over 2020. Because of the retroactive revision in the 2021 SUI rates, the Division had to reissue the 2021 SUI tax rate notices.

The Division estimated that freezing the 2021 SUI tax rates at the 2020 levels will save employers money in 2021¾up to $264 per employee, and for new employers, up to $165 per employee. (Delaware Live, January 11, 2021.)

2021 SUI wage base

The SUI taxable wage base remains at $16,500 for 2021.

Delinquent employers are assigned a penalty rate

Employers that had outstanding SUI tax reports, assessments, penalties, or interest as of September 30, 2020 were assigned the delinquent assessment rate of 6.5% (or the computed rate if higher) for 2021.

Special training tax assessment will increase as the taxable wage base decreases

The 2021 special training tax assessment remains unchanged at 0.095%. The special training tax assessment increases when the SUI taxable wage base decreases. The assessment rate is 0.085% when the SUI taxable wage base is $18,500, 0.095% when it is $16,500, 0.11% when it is $14,500, 0.126% when it is $12,500 and 0.15% when it is $10,500.

The special training tax assessment is mailed separately to employers on a semiannual basis.

Employers are not charged for COVID-19 UI benefits during Delaware's state of emergency

As we reported, Delaware employers are not being charged with COVID-19 UI benefits through the end of the state's COVID-19 emergency order (most recently extended for the 27th time on April 28, 2021). (EY Tax Alert 2020-2084, 8-17-2021.)

For more information regarding Delaware SUI taxes, see the Division's website.

———————————————

Contact Information
For additional information concerning this Alert, please contact:
 
Workforce Tax Services - Employment Tax Advisory Services
   • Kristie Lowery (kristie.lowery@ey.com)
   • Kenneth Hausser (kenneth.hausser@ey.com)
   • Debera Salam (debera.salam@ey.com)

———————————————
ATTACHMENT

EY Payroll News Flash

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 1996 – 2024, Ernst & Young LLP

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

EY US Tax News Update Master Agreement | EY Privacy Statement