With the passage of House Bill 413 in the 2021 legislative session, employers will see changes in their unemployment insurance taxes due this month. Sponsored by Representative Russell Webber, House Bill 413 was a priority of the Kentucky Chamber, and the new law will ease the unemployment insurance burden for Kentucky businesses.
This legislation resulted in several changes including a tax increase freeze which will lower UI tax costs for employers in 2021. The following is a full list of changes created by the bill.
- Amended KRS 341.030(7) to suspend the taxable wage base increase for calendar year 2021 and to utilize the same taxable wage base as 2020.
- Amended KRS 341.270(3) to provide that, for calendar year 2021 the employer contribution rate schedule will be determined by the rates set forth in “Schedule A” of “Table A” of KRS 341.270(4).
- Amended KRS 341.530 to provide that unemployment benefits payable related to a state or federal emergency or disaster declaration would be paid from the unemployment insurance fund pooled account and not charged to an employer’s reserve account.
- Amended KRS 341.614 to provide there would be no unemployment administration account surcharge assessment for calendar year 2021.
The Kentucky Labor Cabinet said it will very soon be mailing an “Amended 2021 Contribution Rate Notice” which will reflect the change of contribution rates for employers based on “Schedule A” of “Table A” of KRS 341.270(4). In addition, the taxable wage base for calendar year 2021 will remain at $10,800 per worker.
Employers are being asked to ensure they make these adjustments before filing their 1st quarter of 2021 Quarterly Unemployment Tax and Wage Reports, which are due on or before April 30, 2021.