Maryland Governor Larry Hogan has announced that next year Maryland employers will continue to benefit from the lowest possible unemployment insurance tax rates allowed under state law. The Maryland Department of Labor, Licensing and Regulation is able to offer this advantageous rate due to declining unemployment and, consequently, lower unemployment benefit payments.
“Growing Maryland’s economy is our administration’s number one priority,” Hogan said. “By improving our state’s business climate, employers are able to benefit from a continued low unemployment insurance tax rate, which allows them to create even more jobs and opportunities for our hard working citizens.”
In 2017, the range of rates will be from 0.3 percent to 7.5 percent. The rate for new employers in 2017 will be 2.6 percent. An exception is the rate for new construction employers headquartered in another state, which will be 6.6 percent. The taxable wage base for 2017 will remain at $8,500.
Given most Maryland employers pay the minimum tax rate, many organizations will continue to pay $25.50 per employee per year. Since September 30, 2015, Maryland’s Unemployment Insurance Trust Fund has grown by more than $94 million to nearly $1.1 billion as of September 30, 2016.
Maryland recently reached an all-time high, historic number of employers doing business in Maryland, 146,300 employers in the state – an additional 7,000 businesses since January 2015.
“As the unemployment rate decreases, not only are more Marylanders working, but the amount of state benefits paid also decreases,” said Maryland Labor Secretary Kelly M. Schulz. “Under the direction of the Hogan administration, employers are able to thrive and create jobs, as the state and business community work together to continue strengthening our economy.”
Nonprofits have options
The above applies to all Maryland employers except 501(c)(3) organizations. 501(c)(3)s do not have to pay state unemployment insurance taxes – high or low. Many Maryland nonprofits could save as much as 30 percent on their unemployment costs by opting out of the unemployment insurance tax system – an advantage provided to them by the IRS. Doing so affords nonprofits unique avenues that allow them to strategically handle unemployment claims administration and unemployment insurance taxes in ways that for-profits can only dream about.
Contact us today for more information concerning your nonprofit unemployment insurance tax advantages.
