On November 8th, Connecticut Governor Lamont announced that the state was paying of the loan from the federal government that was used to pay unemployment compensation in Connecticut. See the Governor’s press release at Governor Lamont ‘s press release reporting that Connecticut paid off pandemic-era Unemployment Trust Fund debt in advance of the November 10, 2023, deadline. Connecticut Commissioner of Labor Danté Bartolomeo explained that for tax year 2022, the federal tax rate per full-time employee rose to $63 per year, an increase that the General Assembly mitigated through legislative action that reduced employer state taxes by more than the federal increase. If Connecticut still carried a loan balance on November 10, 2023, the federal tax increase on employers would have brought the
minimum rate to $84 per full-time employee per year. Since the loan balance on November 10, 2023, is zero, the minimum federal tax rate for employers drops back to $42 per full-time employee per year for tax year 2023.
We are pleased to see that Connecticut took action to avoid the FUTA tax increase that would have resulted if the outstanding loan had not been paid.
As of November 14th , employers in only the States of California, New York and the Virgin Islands will be obligated to pay increased FUTA taxes for 2023 due to outstanding loans. Employers in California and New York will be obligated to pay approximately $84 per employee (instead of the normal $42 per employee) and employers in the Virgin Islands will see FUTA tax continuing to increase to the historic high of approximately $315 per employee.
The final FUTA payment for 2023 that applies the FUTA rate (changed due to the reduction in the offset) is due by January 31, 2024.
