2025 Unemployment Insurance Trust Fund Financial Summary

(as of February 11, 2026)

Wisconsin's Unemployment Insurance (UI) Trust Fund is the account that holds employers’ state UI taxes which finance regular state UI benefit payments. The UI Trust Fund functions as a reserve in case of increased state UI benefit payments during economic downturns. The higher the UI Trust Fund balance, the less likely it is that the state will need to borrow from the federal government during recessionary periods.

2025 UI Trust Fund Quick Facts

UI Trust Fund balance as of December 31, 2025 was over $2.1 billion
$151 billion in wages insured for Wisconsin employees
Schedule D (lowest tax rate schedule) in effect
Employers are only taxed on the first $14,000 of each employee's wages
- More than 95% of employers had a UI tax rate below 4%
- More than half of all employers had a UI tax rate below 2%
Employers saved an estimated $50.5 million in payable taxes in 2025
Highest potential monthly tax per employee: $140
- Only employers who utilize the UI system heavily would pay this amount
Lowest potential monthly tax per employee: $0

Tax Rates

In Wisconsin, employers are only taxed on the first $14,000 of each employee's wages. Wisconsin employers may benefit from additional cost savings on UI taxes as they are eligible for the full amount of federal tax credit reductions. The federal rate for Wisconsin employers who pay state UI taxes timely is only 0.6% on the first $7,000 of employee wages, a maximum of only $42 per employee. The maximum federal rate is 6%.

Employers were notified of their 2025 tax rates and provided information about the UI financing system in October 2024. The breakdown of 2025 rate notices sent to taxable employers in 2024, separated by tax rate brackets, is shown in Table A below:

Table A - 2025 Tax Rate Distribution**

Tax Rate Bracket	Number of Employers	Percent of Employers
0%	15,277	8.9%
0% to <1%	65,582	38.0%
1% to <2%	21,614	12.5%
2% to <3%	14,449	8.4%
3% to <4%	47,204	27.4%
4% to <5%	3,151	1.8%
6% to <7%	1,884	1.1%
7% to <8%	368	0.2%
8% to <9%	721	0.4%
9% to <10%	415	0.2%
10% to <11%	103	0.1%
11% to <12%	573	0.3%
12%	1,184	0.7%
Total	172,525	100.0%

**Schedule D does not contain a rate in the 5% to 6% range unless an employer elects a seasonal designation.

In 2025, more than 95% of Wisconsin employers had a tax rate below 4% and more than half of all employers had a tax rate below 2%.

Only 0.7% of all employers had the maximum tax rate of 12%. Approximately 9% of all employers had a 0% tax rate.

The average effective tax rate for 2024 was 0.37% which equates to $4.32 per month per employee. The most an employer would pay is $140 per month per employee if they utilized the UI system heavily.

Rates for 2026 were mailed to employers along with information about the UI financing system in October 2025.

UI Financing Overview

DWD's Unemployment Insurance Division collects employer's state unemployment taxes and provides benefits to eligible workers. Taxes the UI Division collects are deposited into the Wisconsin UI Trust Fund, and state UI benefits are paid to claimants from the UI Trust Fund.

Most employers in Wisconsin are "covered employers" who must participate in the UI program. Most of these are taxable employers whose tax rate is set by two factors: the UI tax schedule in effect for a given year and the employer's "experience rating."

The UI tax schedule in effect is determined by the balance of the UI Trust Fund on June 30 of the previous year.

Tax Schedule	UI Trust Fund Balance (as of June 30 of the previous year)	Employer Contribution Rate
Schedule A	Less than $300,000,000	Highest
Schedule B	Greater than or equal to $300,000,000 but less than $900,000,000
Schedule C	Greater than or equal to $900,000,000 but less than $1,200,000,000
Schedule D	Greater than or equal to $1,200,000,000	Lowest

The other factor that determines an employer's tax rate is their "experience rating." An employer with a high number of laid off workers will pay a higher tax rate. The federal government requires states employ an experience-rated tax system.

The tax rate for new employers is set to a fixed rate for the first three calendar years since new employers don't have enough history to determine their experience. The UI tax rate for new employers varies depending on payroll and industry. Rates were between 2.90% and 3.25% in 2025.

Trends

Schedule D, the lowest tax rate schedule, has been in effect since 2018.
This is the tenth consecutive year that employers can take advantage of a zero percent total rate, as both Schedules C & D allow for a zero percent tax rate.
Small employers made up the vast majority (almost 94%) of all taxable Wisconsin employers.
57.9% of employers saw their tax rates decrease or remain unchanged in 2025, with 21.5% seeing an increase.
- 20.6% of employers were taxed at the new employer rate.
Employers saved an estimated $50.5 million in UI taxes in 2025.

Noteworthy Differences in Wisconsin's UI Financing

Wisconsin is one of few states that has statutory limits on how much employer tax rates can change from year to year.

Wisconsin's UI Trust Fund has remained solvent, borrowing from the federal government sparingly in recent history.

Work-Share

Employers can utilize the Work-Share program as a tool to retain trained staff during times of reduced business activity while also minimizing the impact layoffs can have on their experience rating.

The Work-Share program allows employers to reduce employee hours and make affected employees eligible for partial UI benefits to cover their reduction in hours. Work-Share lowers the risk of employers losing skilled staff, as employees are able to continue working, receiving health and retirement benefits if covered, and receive some UI benefits without needing to register for work or conduct work searches.

Since Jan. 1, 2023, the Work-Share program has helped avoid over 3,000 layoffs.

Learn more about how the Work-Share program benefits employers.

Statutory References: Wis. Stat. § 108.14(24) and Wis. Stat. § 108.18(5)