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Internet Tax and Wage Reporting
Zero Payroll Reporting Telephone System
Employer Agent Reporting Format
How Your Tax Rate is Determined
Reading Your Account Statement
Payment of Taxes Via Electronic Funds Transfer
Report all wages on a calendar quarter basis. Only the first $10,500* in wages paid to each employee in the calendar year is taxed. Wages paid to each employee beyond the $10,500* limit are reported as excluded from taxation.
*Note: The wage base will be increasing to $12,000 beginning with the first quarter of 2009.
If you are subject to the Wisconsin UI Law you must file a quarterly report even if you didn't have payroll in the quarter.
Contribution reports are due by the close of the month following the end of the calendar quarter.
The quarterly due dates are:
1st qtr. (Jan., Feb., Mar.) due April 30;
2nd qtr. (Apr., May, June) due July 31;
3rd qtr. (July, Aug., Sept.) due October 31; and
4th qtr. (Oct., Nov., Dec.) due January 31.
If your contribution report and/or payment is not received by the due date, interest accrues on the delinquent taxes at the rate of 1.0% per month or fraction of a month.
Employers with a first quarter tax liability of $1,000.00 or more can defer paying up to 60% of the total liability to future quarters. To avoid assessment of interest on the deferred amount, employers must comply with the following requirements.
The employer must not have any prior quarter outstanding amounts due on April 30. This includes interest, penalties, or other fees.
The first quarter contribution/wage report and at least 40% of the first quarter tax liability must be received by the April 30 due date.
The next 30% of the first quarter and all second quarter tax liability must be paid by July 31.
The next 20% of the first quarter and all third quarter tax liability must be paid by October 31.
The remaining 10% of the first quarter and all fourth quarter tax liability must be paid by January 31 of the next year.
Interest will not be assessed on the deferred amounts as long as the installment payments and subsequent quarter tax payments are made by the specified due dates. If there are any other amounts due on each of the specified due dates including interest and/or penalties, interest on the deferral amount will be assessed retroactive to April 30. All quarterly contribution/wage reports for quarters subsequent to the first quarter must be filed by the appropriate due dates.
Please note that any deferral amount not paid prior to July 31 will not be included in your account balance for purposes of computing your tax rate for the next calendar year. This could result in being assigned a higher rate.
To take advantage of this deferral option, you must inform this Department of your intention to defer payments by the first quarter due date and file your reports electronically. If you have any questions, please call an employer service representative at 608-261-6700.
There is a web site available for employers to file their Wisconsin Unemployment Insurance tax and wage report. A payment coupon will be provided to submit with the tax due or payment can be made through ETF. The web site address is http://unemployment.wisconsin.gov and click on "File Tax and Wage Reports".
One advantage of entering the wage and tax reports online is the system will calculate the wage base exclusion for you.
Unless an employer uses an employer agent to prepare their report, employers with 25 or more employees are required to file their tax report using this web site. This requirement took effect beginning with the report for 3rd quarter 2008. Continued filing on paper will result in a $25 penalty.
Employers who do not pay wages during a quarter can file their quarterly contribution/wage report by calling (608) 261-4571. This eliminates the need to send us a paper report. The telephone system will prompt you for your UI account number and ask you to indicate the quarter and year you are reporting. You can only use this filing method if you paid no wages during the quarter.
When filing a zero report, you can also file an out-of-business report if applicable. After selecting the out-of-business option, the system states "Your account will be set to an inactive status as of the first day of the most recent quarter reported", and all necessary transactions are processed to inactivate your account. This also eliminates the need to send a paper notification of your out-of-business status.
Employer agents who prepare UI reports, must file them electronically. A $25 penalty may be assessed for each employer report not filed electronically.
As a newly subject employer, your tax rate is fixed for the first three calendar years. The new employer rate is currently 3.25% for 2008 and 2009 for employers with a fiscal year taxable payroll under $500,000.00 and 3.4% for those over $500,000.00.
Newly liable construction industry employers pay at the average rate for all other experience-rated construction industry employers. The applicable construction industry rate for new employers is redetermined each year. The rate is 6.6% for 2008 and 2009.
New employer tax rates apply to a calendar year and not to the first four or eight calendar quarters during which an employer has payroll. After the first three calendar years, you will be assigned an annually determined "experience" rate based upon the activity in your account.
An account balance is maintained for each individual employer covered under the UI Law. The balance is maintained for tax rating purposes only. The taxes paid are similar to insurance premiums and, therefore, in the event an employer goes out of business, no money in the account is returned to the employer. The balance increases with each tax payment made by the employer and decreases with every unemployment benefit payment made to their laid off workers. After the initial new employer tax rating period, 3 years, we determine your experience rate as follows:
Your account balance as of June 30, which includes tax payments made
through July 31 and benefit payments made through June 30, is one
factor used to compute your rate. Another factor is your fiscal year
taxable payroll as reported on your quarterly reports for the fiscal
year ending on June 30 of the current year. In simple terms, the
quarters would always be the last two quarters of the previous year
and the first 2 quarters of the current year.
Your account balance is divided by the fiscal year
taxable payroll to determine your "reserve
percentage" which in turn determines your tax rate for the next
year.
The "reserve percentage" is then applied to the rate schedule. The rate schedule shows a basic rate and a solvency rate total rate. The basic rate portion of each tax payment is credited to your account balance. The solvency rate portion of each tax payment is credited to a shared risk account called the balancing account. Your total rate is the sum of your basic rate and your solvency rate and is the rate shown on your quarterly tax report.
This total rate applies to all quarters for the following calendar year. You will normally receive your notice of rate in mid-October for the next calendar year. Form UCT-100B is the rate notice.
The rate schedules can change from year to year depending on the overall condition of Wisconsin’s Unemployment Reserve Fund. The cash balance in the Reserve Fund on June 30 each year determines which of the 4 statutory rate schedules is in effect for the following calendar year. The rate schedules is in effect for the following calendar year. The rate schedule differs if you are considered a small or a large employer. If taxable payroll is $500,000.00 or more, the employer would be considered a large employer.
(Return to Top)Each year employers have the option of making an extra contribution, which is credited directly to their June 30 account balance and is used for the purpose of lowering their UI rate for the following year by one rate bracket on the rate schedule. This extra payment is called a "voluntary contribution".
A "voluntary contribution" is a payment over and above your required quarterly contributions and directly affects the account balance used to determine your next year’s rate. You may submit a voluntary contribution to obtain a lower rate for the upcoming year only in November of each year. These payments must be postmarked by November 30. It is not always advantageous to submit a voluntary payment as this payment might be more than the savings you realize.
To determine the dollar amount needed to lower your rate:
Take the "reserve percentage" from your rate notice and locate that number on the rate schedule.
Look at the minimum "reserve percentage" for the next lower tax rate on the schedule. This minimum percentage is what will be required for you to get the next lowest rate.
Multiply the "reserve percentage" of the lower rate by your fiscal year payroll as shown on the rate notice. This figure represents the account balance needed to qualify for the lower rate.
Subtract your actual June 30 balance on your rate notice to obtain the amount of voluntary contribution needed. To determine if you are going to realize a savings in taxes payable for next year, multiply the difference in the tax rates by the fiscal year payroll from the rate notice. If this figure is more than the amount of the voluntary contribution needed, you are realizing a savings. If not, paying at the original rate will cost you less. Remember, other circumstances such as an increase in payroll may alter your decision. We will be glad to help you compute your voluntary contribution and determine if you are likely to realize a savings. Call (608) 261-6700 for help or you can access your account online and use the Voluntary Calculator. See the first page of the Tax Section for more information about online access and services.
A voluntary payment once submitted is irrevocably paid. The amount of any voluntary contribution in excess of the amount necessary to lower your rate one bracket will be set up as a credit and will be refunded at your request.
Use a Form UCT-7842, Contribution Adjustment Report http://dwd.wisconsin.gov/dwd/forms/238e/uct-7842.PDF or write us a letter to correct any reporting errors in your account. The adjustment should include a quarterly breakdown of the changes to be made.
Mail adjustment forms or letters to:
Bureau of Tax & Accounting
Division of Unemployment Insurance
P.O. Box 7942
Madison, WI 53707
If you have over-reported your taxable wages, you may request a refund. You must apply for it within three years after the close of the calendar year in which the payment based on the over-reported amount was made.
If the adjustment is for underreported wages, follow the same procedure in notifying the department. Submit any additional taxes due at the tax rate assigned for the year underpaid.
We will refund your overpaid taxes if you have no outstanding UI liabilities and your credit is greater than your estimated UI taxes for the next two quarters. Refunds are not made during the tax collection months of January, April, July and October.
(Return to Top)Form UCT-14384, Reserve Fund Balance Statement, is an informational statement sent to you after the end of each week in which there has been some account activity.
The form shows the prior balance, tax payments credited, benefit charges debited or credited and the new ending balance. The ending balance represents a cumulative total since the account was opened.
Contributions to the UI fund are considered a tax and, as such, are not refundable. Contributions are split into two categories in accordance with Chapter 108.18. They are:
- Reserve fund: An employer’s quarterly tax payment posted to their account generated by the "basic" portion of the employer's tax rate.
- Solvency: An employer’s quarterly tax payment posted directly to the state solvency (balancing) account generated by the "solvency" portion of the employer's tax rate.
Both basic and solvency payments represent taxes paid and are not refundable should you go out of business. The balance in your account, along with all other experience, may be transferable under certain conditions should your business be sold (see Part 6: "BUSINESS TRANSFERS AND TAKING OVER A UI ACCOUNT").
(Return to Top)Generally, if you are subject to Wisconsin's UI Law you will also be subject to the Federal Unemployment Tax Act (FUTA). Compliance with the federal law is established by filing U.S. Treasury Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return . Government units and statutory nonprofit organizations are exempt from taxation under FUTA.
You must file a Form 940 with the Internal Revenue Service (IRS) by January 31 of the following year. Certain employers are required to make advance quarterly deposits. Contact any IRS office for more information and/or to request Form 940.
The FUTA tax is 6.2% with a corresponding offset credit of 5.4% if state UI taxes have been paid timely. The net FUTA tax remains at 0.8%.
Each year the federal government asks us to certify that the wages and tax payments you listed on Form 940 as having been paid to Wisconsin are correct and were paid timely.
This certification is done by a computer cross match utilizing your Federal Employer Identification Number (FEIN). To properly certify your offset credit, it is important that we have your correct FEIN on our records and that it matches the FEIN shown on your Form 940. Important: When completing your Form 940, be sure to use your State Unemployment Account number when asked for your State reporting number.
When discrepancies occur between state and federal reports, the IRS will send you a notice of the discrepancy and a bill for any additional tax that may be due.
If you need to request a certification of your Wisconsin UI taxes paid or have any related questions, contact us at:
E-mail: taxnet@dwd.wisconsin.gov
or
Telephone: (608) 261-6700
Deaf, hearing or speech-impaired callers may reach us through WI TRS.
See next page for Example of Federal Unemployment Tax Return.
(Return to Top)You can make your quarterly tax payments via electronic funds transfer (EFT). Electronic Payment Options can be found at http://www.dwd.state.wi.us/uitax/eft.
(Return to Top)If you file your unemployment report using the QTWRS internet reporting system, http://uiqtwrs.wisconsin.gov, EFT is an available payment option that can also be done on the internet right after your report has been filed. On the payment selection page select the payment option that says EFT on the internet.
In addition, the Wisconsin Department of Revenue (DOR) has set up an EFT payment system for employers to pay various state taxes including Unemployment Insurance (UI) and withholding tax.
Before an employer can use the DOR payment system, they must first request registration forms and instructions by contacting the DOR at http://www.revenue.wi.gov/eserv/eft1.html or by calling the DOR EFT service line at 608-264-9918. Employers that file their report electronically on QTWRS and then pay EFT using the DOR payment system should select the payment option Any other type of EFT when on the QTWRS payment selection page. The employer is responsible to log into the DOR payment site and make their EFT payment.
Employers may also send an ACH Credit payment. The ACH credit payment method allows you to pay your UI Taxes by instructing your financial institution to debit your account and credit the state's bank account. No registration is required by Unemployment Insurance to start making EFT credit payments,. Financial institutions may charge you a fee for making ACH credit payments. Please contact your financial institution to see if they offer this payment method. Detailed ACH Credit instructions your financial institutions must follow can be found at http://www.dwd.state.wi.us/uitax/eft/creditinstruct.ht m. Employers that file their report electronically on QTWRS and hen pay by having their financial institution make an EFT credit payment should select the payment option Any other type of EFT when on the QTWRS payment selection page.
When paying by EFT and submitting a paper report, please enter 0.00 on line 18 (total amount enclosed with this report) of the paper report. Line 18 is only filled in with your payment amount when your payment is enclosed with the paper report.
Deaf, hearing or speech impaired callers may reach us through WI TRS.
If you no longer have employment or if you are closing your business, let us know so we can stop sending you quarterly tax and wage reports. We will notify you if your account is eligible to be closed, and after three years, we will issue an Initial Determination that closes your account. This applies to tax employers only. Reimbursement employers’ accounts remain open because of the potential for benefit charges that must be repaid by the reimbursable employer.
If your account is closed, your positive or negative account balance will be transferred to the balancing account. If you go into business again, your payroll will be taxed at the new employer tax rate in effect at that time.
To obtain information on closing your UI account, contact us at:
E-mail: taxnet@dwd.wisconsin.gov
or
Telephone: (608) 261-6700
Deaf, hearing or speech-impaired callers may reach us through WI TRS.
Updated: February 2, 2009