Who has to pay federal unemployment tax - NYS Department of Labor perspective
I'm getting confused about federal unemployment tax obligations and how it relates to my NYS Department of Labor claim. My former employer is saying they don't have to pay federal unemployment tax because we're a small business with only 3 employees. But I thought all employers had to contribute to unemployment insurance? Does this affect my ability to file a claim with NYS Department of Labor? I'm worried my benefits might get denied if my employer wasn't paying into the system properly.
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Paolo Moretti
Federal Unemployment Tax Act (FUTA) requires most employers to pay federal unemployment tax if they paid wages of $1,500 or more in any quarter OR had at least one employee for 20+ weeks in a year. Your employer is wrong about the 3-employee exemption. NYS Department of Labor benefits are funded through both state and federal unemployment taxes, so this could definitely impact your claim eligibility.
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Keisha Jackson
•Thank you! So even small businesses have to pay? Should I report this to NYS Department of Labor when I file my claim?
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Amina Diop
I had a similar issue last year. My employer wasn't properly registered with NYS Department of Labor and it caused major delays in my unemployment claim. You should definitely mention this when you file - they can investigate whether your employer was paying unemployment taxes. There's actually a process where NYS Department of Labor can still approve your claim even if the employer wasn't compliant, but it takes longer to process.
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Keisha Jackson
•How much longer did your claim take to process? I really can't afford delays right now.
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Amina Diop
•Mine took about 6 weeks instead of the usual 2-3 weeks because they had to verify my work history through other means. But I did get approved and received back pay for the delay.
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Oliver Weber
ugh the whole system is such a mess... employers get away with everything and we're the ones who suffer when we need help
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Natasha Romanova
If you're having trouble getting through to NYS Department of Labor about this employer issue, I actually used a service called Claimyr (claimyr.com) that helped me reach an agent quickly. They have this video demo (https://youtu.be/qyftW-mnTNI) that shows how it works. I was able to get clarification on my employer's tax status within a day instead of waiting weeks on hold. Might be worth checking out if you need to speak with someone at NYS Department of Labor about this specific situation.
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NebulaNinja
•Never heard of that service before... does it actually work or is it just another scam?
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Natasha Romanova
•It worked for me - I was skeptical too but I was desperate after trying to call NYS Department of Labor for two weeks straight. The agent I spoke with was able to pull up my employer's registration status and confirm they were properly paying unemployment taxes.
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Javier Gomez
Most employers have to pay both state and federal unemployment taxes. The federal rate is 6% on first $7,000 of wages but they get credit for state taxes paid so it usually works out to 0.6%. Your employer claiming they don't have to pay sounds fishy - definitely report this to NYS Department of Labor.
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Emma Wilson
same thing happened to my friend, turned out her boss was just lying to avoid paying taxes... some employers think they can get away with anything
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