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Employers in California and the US Virgin Islands are the only jurisdictions subject to credit reduction for the 2016 tax year due to failure to pay off federal UI loans by Nov. 10, 2016. Employers in these jurisdictions face a 2016 federal unemployment tax that is 1.8 percent higher than employers not in credit reduction states.

Connecticut and Ohio are no longer credit reduction states, having paid off their federal unemployment loans in 2016.

For more information, please contact a member of the firm's National PEO Practice, or visit us on the web at  www.uhy-us.com.