NYS Department of Labor unemployment tax - why do I have to pay unemployment tax as an employee?
I just started a new job and noticed they're taking unemployment tax out of my paycheck. I thought unemployment insurance was something employers paid, not employees? My boss said it's required by NYS Department of Labor but I'm confused about why I have to pay into a system I might never use. Can someone explain what this unemployment tax is for and if it's actually mandatory? I'm making $18/hour if that matters.
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Sofia Price
Yes, you do have to pay unemployment tax as an employee in New York. It's called State Unemployment Tax (SUT) and it's mandatory. The NYS Department of Labor requires both employers AND employees to contribute to the unemployment insurance fund. Employers pay a much larger portion, but employees pay a small percentage too. This money funds unemployment benefits for people who lose their jobs through no fault of their own.
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Mateo Warren
•Thanks! Do you know what percentage they take out? And is there a cap on how much I'll pay per year?
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Alice Coleman
The employee portion is actually pretty small - it's 0.5% of your wages up to a certain amount each year. So on your $18/hour that's only about 9 cents per hour going to unemployment tax. There's an annual wage cap so you won't pay unemployment tax on every dollar you earn if you make a lot. The NYS Department of Labor sets these rates and they can change year to year.
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Owen Jenkins
•Wait really? I thought it was more than that. My paystub just says 'SUTA' and takes out like $12 per week.
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Alice Coleman
•SUTA is State Unemployment Tax Act - same thing. $12 per week sounds about right if you're working full time at decent wages. The exact amount depends on your total weekly pay.
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Lilah Brooks
this is so annoying though like why should I pay for other peoples unemployment when I work hard to keep my job?? seems unfair that responsible people have to subsidize people who get fired
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Sofia Price
•It's actually insurance for YOU too. If you lose your job through layoffs, company closure, or other reasons that aren't your fault, you'll be eligible for unemployment benefits. The system protects everyone, not just 'irresponsible' people.
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Lilah Brooks
•I guess that makes sense but still feels like a lot of taxes coming out of my check
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Jackson Carter
I had to deal with NYS Department of Labor when I got laid off last year and was really glad I had been paying into the system. Getting through to them by phone was impossible though - I kept getting disconnected after waiting on hold for hours. Finally used this service called Claimyr (claimyr.com) that helped me get connected to an actual NYS Department of Labor agent. They have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Made the whole process way less stressful.
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Mateo Warren
•Good to know there are options if I ever need to file a claim. Hopefully I won't but it's reassuring to know the system is there.
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Kolton Murphy
yeah its mandatory cant get out of it. been paying unemployment tax for 15 years and never used it but whatever
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Evelyn Rivera
Think of it like car insurance - you hope you never need it but you're glad it's there if something happens. The unemployment tax you pay helps fund benefits that could be a lifeline if you ever lose your job unexpectedly.
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