IRS Reduces Small Business Unemployment Tax Reporting Requirements
The reporting requirements for Federal Unemployment Tax Act (FUTA) quarterly deposits will change with the start of the new year, in accordance with final regulations (TD 9162) that were issued by the IRS on Nov. 30.
After Jan. 1, employers will only have to make quarterly FUTA deposits if their accumulated FUTA liability exceeds $500. Currently, quarterly deposits must be made if the liability exceeds $100.
The maximum annual FUTA tax per employee is $56. As a result , all businesses with eight or fewer employees will not have to make any quarterly FUTA deposits in the future.
The $100 threshold for FUTA reporting was established in 1970. Increasing the threshold to $500 is expected to benefit more than four million small businesses.
For further information, e-mail Martin Morris at NAHB, or call him at 800-368-5242 x8285.