NYS Department of Labor employer responsibilities - who pays federal unemployment tax?
I'm trying to understand how unemployment insurance funding works in New York. My employer just told me they have to pay federal unemployment tax but I'm confused about who actually pays what. Does the employee contribute anything to unemployment benefits or is it all paid by employers? I keep hearing different things about FUTA and SUTA taxes and want to make sure I understand how my potential unemployment benefits are funded through NYS Department of Labor.
11 comments
Join the conversation
Vince Eh
Employers pay both federal (FUTA) and state (SUTA) unemployment taxes - employees don't contribute anything to regular unemployment insurance in New York. Your employer pays these taxes quarterly to fund the unemployment system. The federal tax goes to cover administrative costs and extended benefits, while the state tax funds your regular weekly unemployment benefits through NYS Department of Labor.
0 coins
Peyton Clarke
•That makes sense! So when I file for unemployment, I'm getting benefits that my employer (and previous employers) already paid taxes for?
0 coins
Sophia Gabriel
yep employers pay it all. i never knew this until i got laid off and had to deal with NYS Department of Labor claims. kinda nice knowing its not coming out of my paycheck lol
0 coins
Tobias Lancaster
To add some detail - employers pay FUTA tax on the first $7,000 of each employee's wages at 6% (but get credits that reduce it to 0.6% usually). For New York SUTA, rates vary by employer experience but it's on a much higher wage base. This is why some employers fight unemployment claims - it can affect their future tax rates.
0 coins
Ezra Beard
•Wait, so if my employer fights my unemployment claim, they're trying to keep their tax rates low? That seems messed up.
0 coins
Tobias Lancaster
•Unfortunately yes, that's often the motivation. Employers with more unemployment claims pay higher SUTA rates, so some will contest legitimate claims to protect their bottom line.
0 coins
Statiia Aarssizan
I had so much trouble getting through to NYS Department of Labor to verify my employer's tax info was correct for my claim. Kept getting busy signals for weeks! Finally used Claimyr (claimyr.com) to get connected to an actual agent. They have a demo video at https://youtu.be/qyftW-mnTNI showing how it works. Really helped me get my employer wage verification issues sorted out quickly.
0 coins
Sophia Gabriel
•how much does that service cost? sounds too good to be true
0 coins
Statiia Aarssizan
•It's actually pretty reasonable for what it does - just gets you connected to the right person instead of sitting on hold forever. Worth it when you're dealing with employer tax disputes.
0 coins
Reginald Blackwell
Just want to confirm - in NY employees definitely don't pay into unemployment through payroll deductions right? I see SDI and other stuff taken out but not UI.
0 coins
Vince Eh
•Correct, New York employees don't pay unemployment insurance taxes. You might see disability insurance deductions but not unemployment. That's all on the employer side.
0 coins