October 19, 2021
Nevada SUI wage base increases in 2022; federal UI loan balance repaid avoiding FUTA credit reduction and employer interest surcharge
The Nevada Employment Security Division announced that, effective January 1, 2022, the state unemployment insurance (SUI) taxable wage base will increase to $36,600, up from $33,400. The SUI taxable wage base is calculated each year at 66 2/3% of the average annual wage paid to Nevada workers.
Federal UI loan balance is repaid
The US Treasury Direct website shows that as of October 7, 2021, Nevada repaid its federal unemployment (UI) loan in full, avoiding the need to assess employers for federal interest on the federal UI loan through an additional surcharge.
Recently enacted SB 461 required that the loan balance be repaid in full using federal American Rescue Plan Act (ARPA) funds. Nevada began borrowing from the federal government in December 2020. As of September 1, 2021, the outstanding balance was $332,437,147. Because of the loan repayment, and if the state can avoid having an outstanding balance as of November 10, 2022, Nevada employers will be spared a Federal Unemployment Tax Act (FUTA) credit reduction for calendar year 2022, which would have increased the FUTA tax rate by 0.3%.
Employers not charged with UI benefits through second-quarter 2021
The Division announced that employer SUI accounts were not charged for UI benefits paid for the second-quarter 2020 through the second-quarter 2021. Contributory employers did not receive benefit charge statements, and reimbursing employers did not receive billing statements, for these quarters.
The Division told us in July 2020 that it intended to not charge employers for COVID-19 UI benefits. Subsequently, a revised regulation released in November 2020 provided that employers were not charged with any UI benefits paid out for the second and third quarters of 2020. Legislation in 2021 (SB 75/Chapter 279) also codified the noncharge of UI benefits for this time period. Accordingly, UI benefits for these quarters were disregarded when the agency calculated employer 2021 SUI tax rates and will continue to be disregarded when calculating the 2022 SUI tax rates. (EY Tax Alert 2020-1997, 8-6-2020.)
For more on SUI taxes in Nevada, go to the Department's website.
Requirement that UI benefit claimants perform work-search activities reinstated; employers should report job refusals
The Division announced that UI benefit claimants were again required to perform work-search activities beginning May 2, 2021.This requirement had been waived due to the COVID-19 pandemic. UI benefit claimants need to keep records to show that they are actively looking for work or participating in an approved training program. Employers are required to report to the Nevada Department of Employment, Training and Rehabilitation any employees who refuse to return to work or accept suitable job offers. For more information, go here.
EY Payroll News Flash