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TAX REPORTING AND PAYMENT INFORMATION

TAX AND WAGE REPORTING REQUIREMENTS

An employer covered under Wisconsin's UI law is required to submit a "Quarterly Contribution/Wage Report." Summary wage and tax information are reported on the contribution part of the report. Individual employee gross wage information is reported on the wage part of the report. The due dates for each report are:

First Calendar Quarter - April 30
Second Calendar Quarter - July 31
Third Calendar Quarter - October 31
Fourth Calendar Quarter - January 31

If the report and tax payment are not received or postmarked by the due date, late filing fees are assessed. In addition, 1% per month interest is charged on the tax amount due. If a preprinted quarterly report form is not received please contact us for duplicate form.

TAXABLE WAGES (Return to Top)

Wages of most employees are subject to the UI law. These include wages of part-time and temporary employees. Payments made under most types of benefit plans are also subject. Wages paid to certain individuals are excluded from the UI tax. Some of the more common exclusions are:

1. The spouse and parents of a sole proprietor.
2. The children of a sole proprietor under the age of 18, or under age 21 if they are students.
3. Certain corporate officers, if elected to be excluded by the employer.

An employer pays UI tax on the first $10,500 in wages paid to each employee in a calendar year. For example, if an employee earns $16,000 in a calendar year, only the first $10,500 is taxable. The remaining wages of $5,500 are excluded from the UI tax.

TAX RATES  (Return to Top)

UI tax rates for each employer can change each year depending on the employer's unemployment experience and payroll size. Tax rates are computed and mailed to employers each October for the following calendar year.

Rates are computed by determining a reserve ratio for each employer. This rate is based on the employer's taxable payroll for the 12 months ending June 30 and the balance in the employer's account as of June 30. This ratio is then converted to a tax rate based on the statutory tax rate schedule in effect at that time.

The total tax rate consists of a basic rate and a solvency rate. Only taxes paid under the basic rate are credited to the employer's account balance.

Individual account balances are maintained for each employer. The account balance increases every time an employer makes a tax payment and decreases each time a UI benefit payment is made to an eligible employee. THIS ACCOUNT BALANCE IS ONLY MAINTAINED FOR TAX RATE COMPUTATION PURPOSES. It is not a credit which can be used to offset future UI tax liability or reimbursed if the business closes.

It is important for an employer to have all tax liability paid by July 31 each year. The more money in the account, the lower the tax rate. If taxes are not paid by the July 31 deadline, the lower account balance may result in a higher tax rate for the next year.

For the first three calendar years of coverage, an employer pays at a fixed rate. Coverage during any part of a calendar year counts as an entire calendar year.

CORPORATE OFFICER EXCLUSION  (Return to Top)

Some corporations may elect to exclude the wages of certain corporate officers from both state UI taxes and benefits. Corporations with an annual taxable payroll of less than $500,000 can exclude the wages of principal corporate officers who have at least a 25% ownership interest in the corporation.

The election form must be filed before March 31 of the year in which the employer wishes to start the exclusion. Obtain the election form by calling the number below.

Although excluded for state tax purposes, corporate officer wages cannot be excluded from the Federal Unemployment Tax Act (FUTA).

Therefore, it may not be advantageous for some employers to elect the exclusion. Please contact us for assistance.

VOLUNTARY CONTRIBUTIONS  (Return to Top)

During the month of November, certain employers have the option of making voluntary contributions to lower their tax rate for the following year. Voluntary contributions credited to employer's account balances and can reduce an employer's rate by one rate bracket.

Employers who received a 10% write-off during the prior five years are not eligible to make voluntary contributions. Information on voluntary contributions is included with the annual rate notices mailed to employers each October.

ADJUSTMENTS TO REPORTED WAGE INFORMATION  (Return to Top)

Adjustments to a Quarterly Contribution/ Wage Report, can be made by sending a letter explaining the adjustment or by submitting a "Contribution/Wage Adjustment" form obtained from us. Adjustments to previous years wage totals can increase or decrease tax rates and taxes due for those previous years.

Overpayments of tax liabilities result in a credit. This credit can be used to offset future tax liability or can be refunded. Refunds will be made on request or will occur automatically if the credit is unlikely to be used as a tax offset over the following two quarters.

The Department of Workforce Development does not discriminate on the basis of disability in the provision of services or in employment. If you need this printed material interpreted or in a different form or if you need assistance in using this service please contact us.

Callers with speech or hearing impairments may reach us through WI Telephone Relay System.

You may write to us at the:

Unemployment Insurance Division
P.O. Box 7942
Madison, WI 53707-7942

Or you may call:

Employer Service Team
(608) 261-6700
FAX (608) 267-1400

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