The New Mexico Department of Workforce Solutions announced that the 2017 state unemployment insurance (SUI) taxable wage base will increase to $24,300, up from $24,100 for 2016.
According to the Department, revised state unemployment insurance (SUI) tax rates for the third and fourth quarters 2016 will be issued in November 2016, as the result of legislation enacted earlier this year. Employers affected by the change will have their accounts credited for any overpaid amount for the third quarter, the amount of which may be applied against future SUI taxes or requested as a refund.
New Mexico 2017 SUI tax rates will also be issued in November.Find all the necessary information on SUI taxable wage bases and tax rates to remain compliant and reduce costs.
Changed SUI Rate Computation
HB 283 will reduce many experience-rated employers’ SUI tax rates for third and fourth quarter 2016 and beyond by adding an experience history factor to the rate calculation formula.
Effective for calendar year 2017, an additional reserve factor will be added to the computation of SUI tax rates that will reduce many employers’ tax rates. The reserve factor will be multiplied by an experience history factor, computed as all of the employer’s previous contributions, minus all of the employer’s benefit charges, to equal the reserve balance, divided by the average of the last three fiscal years of taxable payroll, and then applied to a schedule.
The bill requires that experience-rated employers’ SUI tax rates for 2016 be recomputed using the new formula for the third and fourth quarters 2016, effective July 1 through December 31, 2016.
This is not a retroactive change to the beginning of the calendar year. New employer tax rates will not change, and the minimum New Mexico 2017 SUI tax rates will remain at 0.33% and the maximum rate before adding the excess claims premium at 5.4%.Find out about a ruling issued by the Supreme Court on the Quality Stores/FICA severance pay taxability issue and effects it will have on employers.
State Unemployment Insurance in 2019
The wage base is $24,800 for 2019 and for 2018 it was $24,200. Rates range from 0.33% to 5.4% for 2019 and 2018.
New contributing employers will have a rate that is greater than their industry average Unemployment Insurance Contribution rate or 1% for 1029 and 2018. To find industry average, employers need to visit New Mexico Department of Workforce Solutions.Bring another level of efficiency to your company with tax management software and automate reporting and tax calculation processes while saving your staff time and effort.
Editor’s Note: This post has been updated for accuracy and comprehensiveness.