Washington ESD employer asking about federal unemployment tax FUTA requirements - what applies?

So I'm paying both Washington ESD state taxes AND federal FUTA taxes? That seems like double taxation.

Yes, they're separate systems. FUTA funds the federal portion of unemployment benefits and administrative costs, while Washington ESD taxes fund the actual benefit payments to claimants.

OK so there are thresholds. What if I only have seasonal employees?

seasonal employees count toward the 20 week rule if they worked any part of those weeks

Did you have trouble getting through to the IRS? I heard their phone lines are terrible.

It took a few tries but I eventually got someone knowledgeable. Way better than trying to figure it out from the publications alone.

Interesting, I hadn't heard of that. Is it expensive?

They focus on the value of actually getting through rather than pricing. For business compliance issues, the cost of not getting proper answers is usually way higher than any service fee.

I've heard good things about Claimyr from other business owners who needed to reach Washington ESD quickly about employee issues.

That's actually helpful - so if I have someone making $50k, I only pay FUTA on $7000 of that?

Exactly. It caps at $7000 per employee annually. Makes it more manageable for businesses with higher-paid employees.

I'm running a regular business, not household employment, but good to know.

Yeah, just wanted to mention it since the rules can be confusing and some people don't realize there are different categories.

Right, so I need to register with both Washington ESD for state taxes and handle FUTA for federal?

Yes, they're completely separate registration and payment systems. Washington ESD handles the state side, IRS handles FUTA.

Is Washington at risk of that happening?

Not currently, but it happened to some states after the 2008 recession. Washington generally manages its unemployment fund pretty well.

Washington's unemployment fund is actually in good shape compared to many states, so the full FUTA credit should apply.

I'm in retail, so I assume standard employment rules apply to my workers?

Yes, retail employees would be covered under standard FUTA rules. The exceptions are pretty specific.

Tell me about it. I thought hiring employees would be straightforward.

It gets easier once you have systems in place, but the initial learning curve is steep.

I've been doing it manually but maybe it's time to invest in proper software.

For the peace of mind alone, it's usually worth it. Plus it handles all the quarterly filings and deposits automatically.

More complicated timing rules... great. How do you keep track of all this?

I set up calendar reminders for all the different due dates. Federal and state requirements rarely align perfectly.

An audit sounds terrifying. What kind of documentation did they want?

Payroll records, timesheets, basically anything proving when people worked. Pretty standard stuff but you need to have it organized.

Does Claimyr work for IRS calls too, not just Washington ESD?

I believe they help with various government agencies, not just unemployment offices. Worth checking their website to see what services they offer.

Yeah, they're pretty versatile for government agency contact issues. Really helpful when you need answers fast for compliance stuff.

So staying current with Washington ESD affects my federal FUTA rate?

Yes, the systems are connected that way. If you're behind on state unemployment taxes, you lose part of the federal credit.

So many different forms... is there a good resource that explains all of them?

IRS Publication 15 (Circular E) covers most of the employer tax obligations including FUTA. It's pretty comprehensive.

The IRS website also has a decent employer tax guide that breaks down all the different requirements by topic.

Good point, though I'm starting from scratch so that shouldn't apply to me.

Right, just something to keep in mind if your business grows through acquisitions later.

That's probably the most practical advice I've gotten. I think I need to find a good payroll accountant.

Especially as your business grows, the complexity increases. Better to have expert help from the start than try to fix problems later.

Agreed. The time you spend trying to figure this out yourself is usually worth more than professional help costs.