New Mexico’s unemployment rate of 6.8 percent remains well above the national average and is itself higher than last year’s rate. Employment and economic conditions in the state mean that New Mexico unemployment insurance taxes have not been able to drop like many states throughout the country.
Last week the state announced that for 2016, the taxable wage base in New Mexico will be $24,100, up $700 from the 2015 amount of $23,400. The state’s reserve factor has been set at four. Contribution rates range from 0.33 percent to 5.4 percent. New employers will pay the greater of their industry average contribution rate or 1.0 percent.
The state still gets high marks for its unemployment insurance tax structure. New Mexico is ranked No. 7 in the nation by the Tax Foundation for its unemployment insurance tax structure.
The above applies to all New Mexico employers except 501(c)(3) organizations. 501(c)(3)s do not have to pay state unemployment insurance taxes. Many New Mexico nonprofits could save as much as 30 percent on their unemployment cost 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.