One of the most comprehensive payroll law of nonprofit organizations are the reimbursement method of unemployment insurance. Many countries do not allow the advantage of choosing the way of a refund instead of paying unemployment insurance taxes on the wages of each. This article will provide information on the reimbursement method of unemployment insurance in New York and as a non-profit may request reimbursement method, thus saving their payroll taxes.
What method of reimbursement?
State law allows compensation of nonprofit organizations covered under section 501 (c) (3) of the Internal Revenue Code to elect not to pay the unemployment insurance fund, but to restore the state dollar for dollar benefit paid to unemployed workers. This means that the employer does not pay unemployment taxes on wages, but no claims for unemployment in your account, the employer will pay the state directly to the dollar for dollar of benefits paid state employees without jobs.
The substitution method is useful?
The choice of payment method in the way of contribution is a difficult decision must be made without profit. Some things to consider is the unemployment claims against the history of your organization and future behavior of organizations, such as: (a) Are you taking or firing employees? (B) the potential cost of claims against the cost of contributions to the unemployment tax based on current salary and, finally, (c) your tax rate and the current account with the State.
The important thing to remember is that no matter which option you choose, there is no guaranteed way to determine that the election will save money in the long term. We have seen non-stop for years and then claim to change the way of replacement. Then three or four complaints filed against their accounts in a year. On the other hand, even in the previous case, thousands of dollars saved in the long run. Consider the case of an organization with 50 employees, the annual cost of unemployment insurance at a level 4.1% below the method of contribution would be $ 17,425 per year (base salary of $ 8,500 * 4.1% * 50 employees). Assuming that one or two employees file for unemployment benefits every year, and the average employee salary is $ 25,000 per year, the income from an account under the method of payment is less to $ 12,500.00 per year.
Then I was elected, you can change to contribute to the replacement or vice versa?
Yes, but only the beginning of each calendar year. Remember that change will not help with the above statement. You still have to pay the entire balance you owe on the claims presented in the way of change.
If I move in the way of change, what happens to the balance of my account with the State?
Account balance you have in the country under contribution method of tracking who decide to return the selected method of contribution. If you have a positive balance, you can use to plan its replacement, you can not ask the state to pay the amount of surplus.
What if my account balance is negative when moving to a method of reimbursement? Deposited in an account balance until it decides to choose the way of contributions. One thing to consider is that if you have a negative balance, the level of unemployment claims can be high and the likelihood of repayment method is not for you.
What happens if I move in any way in the midst of accusations?
If the State to see your claim as a claim or return of contributions, depending on the time the claim is made or paid, but the reference period used to calculate unemployment benefits for workers. Base payroll period is the period over which to calculate the number of unemployed workers' benefits, in general, the highest quarterly wages paid to workers in the first four of the last 5 / 4.
For example, if the reference period used to calculate unemployment benefits workers are from July to June, and switch to a method of reimbursement in January, 50% of claims are paid out based on the way contribution and 50% of the reimbursement process.
Remember that change will not help with the above statement. You still have to pay the entire balance you have to be covered when changing methods.
How do I apply for reimbursement method?
Demand for choice in selecting a replacement can be made to register with the Department of Labour as an employer with Form NYS-100n (New York State Employer Registration for Nonprofit Organizations) submitted his first paycheck. In addition, applications may be submitted in writing to the Unemployment Insurance Division before the beginning of the calendar year to do, or within 30 days after the calendar quarter in which the nonprofit organization or a public entity becomes liable under the Unemployment Insurance Act.
Application can be mailed or faxed to the fax number and address below. Remember to include your federal tax identification number, the record unemployment and a copy of the notice of 501 (c) (3) IRS status and include the tax identification number and registration number of federal unemployment insurance;
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