December 21, 2023 UPDATED: 2024 SUI taxable wage bases (final as of January 16, 2024)
SUI trust funds are largely financed by employer contributions (in Alaska, New Jersey and Pennsylvania employees also make contributions). States are required to maintain a SUI taxable wage base of no less than the limit set under the Federal Unemployment Tax Act (FUTA). The 2024 FUTA wage limit of $7,000 has remained unchanged since 1983, despite increases in the federal minimum wage and annual cost-of-living adjustments over the last 41 years. Some states are conservative in their approach to maintaining adequate SUI trust fund reserves. Consequently, the SUI wage base is flexible in those states, meaning it is indexed to the average wage or varies based on the trust fund balance. According to the US Department of Labor (US DOL), 26 jurisdictions had a flexible wage base in 2023 (the US DOL expects the 2023 information will be available by the end of December 2023). (US Department of Labor, Comparison of State Unemployment Laws.) 2024 state unemployment taxable wage bases Following is the final list of the 2024 SUI taxable wage bases as of January 16, 2024 (as compared to 2023) and employee SUI withholding rates, if applicable.
Legend * Law sets the taxable wage base; legislation would be necessary to change. ** See applicable footnote below. TBD: 2024 wage base was not available as of the time of this printing. ——————————————— Arizona Effective January 1, 2023, legislation (SB 1828/Chapter 412) increased the SUI taxable wage base to $8,000, up from $7,000. This increase is intended to fund the rise in the maximum weekly unemployment insurance (UI) benefit amount, which, effective July 1, 2022, increased to $320, up from $240. Arkansas Under HB 1430 (2023 Act 196), effective January 1, 2024, the SUI taxable wage is $7,000 when the UI Trust Fund is in excess of $600 million as of June 30 of the most recently completed state fiscal year and limits increases to the taxable wage base to $2,000 each year. (Ark. Code Ann. Section 11-10-215.) Colorado Legislation in 2020 (SB 20-207) held the SUI taxable wage base at $13,600 for calendar year 2021 with incremental increases each year thereafter until it reaches $30,600 in 2026. The SUI taxable wage base is $17,000 in 2022, $20,400 in 2023, $23,800 in 2024, and $27,200 in 2025. After 2026, the taxable wage base will be adjusted by changes in the annual average weekly wage. Connecticut HB 6633/Public (Act 21-200) enacted in 2021, increases the SUI taxable wage base for calendar year 2024 to $25,000, up from the current $15,000. Beginning with calendar year 2025, the taxable wage base will be indexed each year for inflation. Delaware In 2013, legislation (HB 168) increased the SUI taxable wage base to a minimum of $10,500 and a maximum of $18,500 by linking the wage limit to the balance of the state's unemployment trust fund. The higher the trust fund balance, the lower the taxable wage base. Kentucky The taxable wage base is expected to continue to increase by $300 each calendar year until it reaches $12,000. Louisiana Legislation enacted in 2022 (HB 192/Act 116) freezes the 2023 Louisiana SUI taxable wage base to $7,700, as was the case for calendar years 2021–2022. Legislation passed in 2021 (SB 89/Act 91) required that the taxable wage base remained at $7,700 for 2022. In 2020, legislation (SB 55/Act 40) provided that the SUI taxable wage base remained at $7,700 for 2021. Michigan The law provides for a reduced taxable wage base of $9,000 if the UIA Trust Fund balance reaches or exceeds $2.5 billion for two consecutive quarters; otherwise, the wage base is $9,500. (Michigan taxable wage base.) Nebraska Legislation enacted in 2019 (LB 428) increases the SUI taxable wage base to $24,000 for employers assigned the maximum rate. This change was effective for calendar year 2020. The taxable wage base remains $9,000 for all other employers. New Jersey Employee contribution rate includes the Workforce Development/Supplemental Workforce Funds surcharge. New York The taxable wage base will continue to increase as follows: $12,500 in 2024; $12,800 in 2025; $13,000 in 2026; for each year thereafter, computed as 16% of the state's average annual wage. Ohio Legislation enacted in 2016 (SB 235) increased the SUI taxable wage base to $9,500 for calendar years 2018 and 2019. The taxable wage base reverted to $9,000 effective January 1, 2020, and will remain at that amount unless changed by future legislation. Puerto Rico Legislation from 2017 grants the territory's Secretary of Labor the discretion to increase the taxable wage base to as much as $10,500 if deemed necessary. Rhode Island Negative-balanced employers assigned the maximum tax rate will have a taxable wage base that is $1,500 higher than other employers. Tennessee Under Tennessee UI law, if the UI trust fund balance on December 31 of any year is less than $900 million, the taxable wage base is $9,000. If the trust fund balance is above $900 million, but less than $1 billion on December 31, the taxable wage base is $8,000. If the trust fund balance exceeds $1 billion on December 31, the taxable wage base is $7,000. West Virginia 2024 wage base information was provided by Workforce West Virginia via phone call with Ernst & Young LLP on January 5, 2024. Under current law, and effective April 2009, the wage base is $12,000; however, when the unemployment fund reaches $220 million on February 15 of any year, the wage base thereafter will be reduced to $9,000 and each year thereafter the wage base shall increase or decrease by the same percentage that the state's average wage increases or decreases. (SB 246 (2009); W. Va. Code § 21A-1A-28; Code of State Rules § 83-1-7 .1.) ———————————————
Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
