Information about unemployment insurance for employers: tax reporting and liability [Apr. 2011]

Information
about
Unemployment Insurance
for
Employers
Tax Reporting and
Liability
Georgia Department of Labor
MARK BUTLER, COMMISSIONER

What is Unemployment Insurance?
Unemployment insurance provides temporary income to replace a portion of wages lost by workers who have lost their jobs through no fault of their own. Employers pay for unemployment insurance as a business cost through the State Unemployment Tax Act (SUTA) and the Federal Unemployment Tax Act (FUTA).
How do I set up an Account?
The Employment Security Law and the Rules of the Georgia Department of Labor require employers to submit true and accurate information to the department. Employers doing business in this state must complete an Employer Status Report, Form DOL-1A. This form may be obtained from our website at www.dol.state. ga.us or by contacting the Adjudication Section at (404) 232-3301.
Who is liable for unemployment tax?
A private business with at least one worker in 20 different calendar weeks during a calendar year or with a payroll of at least $1,500 in any calendar quarter
An employer who acquired all or substantially all of a liable business in Georgia
A 501(c)(3) non-profit organization with at least four workers in 20 different weeks during a calendar year. (At least one officer or director must be included in this count.)
An agricultural employer who has 10 or more workers on any day during 20 different weeks in a calendar year, or with $20,000 or more in gross payroll for any calendar quarter
An employer with domestic employment in a private home, college club, fraternity or sorority with a payroll of at least $1,000 in any calendar quarter (Domestic employers file their tax and wage reports annually.)
An employee leasing company or temporary help contracting firm that supplies individuals to perform services for clients or customers
If approved by the Commissioner, an employer voluntarily choosing coverage not required by law
An employer liable for FUTA

Who is an employee?
A full-time or part-time worker as defined under statutory law or an officer of a corporation (including sub-chapter S corporations) performing services.
Who is not an employee?
A sole proprietor in the operation of his or her own business
The spouse, parent or child (under the age of 21) of a sole proprietor
Partners, if the business is operated under a partnership
Employees of a church or religious order, or certain church-related schools
Insurance agents or solicitors and real estate sales agents paid solely by commission
Students, if the employment is a recognized part of a program which combines academic instruction with work experience
Individuals performing services for a hospital in a clinical training program for a period of one year immediately following the completion of a fouryear course in a medical school chartered and approved pursuant to state law
Workers hired for casual labor not in the usual course of business, unless the cash remuneration is $50.00 or more in any calendar quarter
Student nurses in the employ of a hospital or nurses training school
Patients performing services in a hospital
Newspaper carriers under 18 years of age
An independent contractor who meets the following condition(s):
l. The worker has been and will continue to be free from control or direction over the performance of services, both under the contract of service and in fact; and, such individual is customarily engaged in an independently established trade, occupation, profession or business or,
2. The worker and the services performed for wages are the subject of an SS-8 determination by the Internal Revenue Service which decided against employee status.

Other employment may be exempt under the law. Specific questions regarding coverage should be directed to the Adjudication Section.
Once determined liable, employers must file quarterly tax and wage reports (Form DOL-4) and pay taxes associated with each report. Domestic employers must file an annual report (Form DOL-4A).
What are wages?
Wages include all remuneration for personal services, including commissions and bonuses, and the cash value of all remuneration paid in any medium other than cash. The reasonable cash value of remuneration in any medium other than cash shall be estimated and determined by the Commissioner as referenced in the Rules of the Georgia Department of Labor. (Agricultural employers should report only cash wages paid the employees and not food and lodging.)
Tax Rate and Taxable Wage Base
Liable employers pay tax on the first $8,500 earnings for each employee each year. Each year all active employers are mailed a Tax Rate Notice, Form DOL-626, showing the tax rate for the following year. Newly liable employers are assigned a beginning rate of 2.70%.
Tax rate calculations consider the history of unemployment insurance benefits paid to former workers, growth of an employer's payroll and the overall unemployment conditions for the state. Employers that fail to receive a Tax Rate Notice or have questions about a tax rate should contact the Rate Unit.
SUTA Dumping is a new name for a broad group of tax avoidance practices sometimes used by employers to improperly and quickly reduce their unemployment tax rates. SUTA Dumping improperly shifts the cost of providing unemployment compensation from the SUTA Dumping employer to all other employers in the state. Additional information regarding SUTA Dumping Regulations can be obtained from our website at www. dol.state.ga.us.
Reporting Taxes and Wages
An Employer's Quarterly Tax and Wage Report, Form DOL-4 Parts I and II for each report period, is mailed to the most recent address of record of all active liable employers. (Address changes are required by law to be reported to the department immediately.) Addresses may be updated on-line at the department's website

www.dol.state.ga.us. Employers that do not receive quarterly report forms can obtain a copy of the form from our web site or by contacting Employer Accounts at 404-232-3220 prior to the quarterly filing deadline. All employers are encouraged to file their quarterly tax and wage reports via internet or magnetic media. (Except: Domestic Employers who must file the paper annual report.)
Parts I and II of the Employer's Quarterly Tax and Wage Report and payment of all tax due must be submitted by the last day of the next month following the end of each report period (quarter). The postmark date determines whether reports and payment are "timely filed". A penalty is imposed for late filing of the report, and interest is charged for unpaid taxes. Penalty is assessed at the greater of .05% of total wages for the tax period or $20 per month or fraction of a month that reports are delinquent. Interest is charged on unpaid tax at 1% per month or fraction of a month from the due date until payment is received.
Suggestions when submitting reports:
Use pre-printed DOL-4 provided. Write legibly. Fill in Part I & Part II. Send original.
Payroll listing on Part I of the DOL-4 should follow the format indicated
Pages attached to the report should be in the same column sequence as the DOL-4
Use standard 8 1/2" x 11" paper
Submit accurate social security numbers
Check calculation of taxes
Use total tax rate, which includes Administrative Assessment portion of the tax rate
Provide correct Federal ID number
NOTE: This information is intended to help employers meet responsibilities under the law. It does not have the effect of law or regulations. It does not cover all applications of the law or answer all questions. Employers can call the Employer Accounts Unit at 404-232-3220 with questions or comments.
Following is a list of telephone numbers for use in contacting the appropriate unit or section. When calling, employers should have their account number (if one has been assigned) and other pertinent documents available for reference.

Subject

Section

Telephone #

New Accounts Adjudication

404-232-3301

Tax Rates Report forms or corrections Delinquent tax reports Magnetic Media reporting

Rate Unit Employer Accounts Employer Accounts Magnetic Media Unit

404-232-3300 404-232-3220 404-232-3227 404-232-3265

Any employer interested in reporting by magnetic media, can visit our web site at www.dol.state.ga.us to obtain specifications. Employers can also contact the Magnetic Media Unit at 404-232-3265 to request a copy of a user's guide and to ask questions about the requirements for reporting by tape or diskette.

Employers with more than 100 employees are required to submit quarterly reports by magnetic media, unless filing via Internet. Employers do not need to submit a paper copy if they file via Internet.

The Georgia Department of Labor offers many services online to employers, job seekers and workforce professionals. Services include:

Information on unemployment taxes & benefits

Information on how employers can protect their tax experience rate

Information to determine if an employer is exempt from paying UI taxes

Information on filing tax & wage reports

Assistance concerning a layoff or plant closure

Information on filing partial unemployment insurance claims

How to obtain information about an employment issue

How to recruit new employees

Information on tax credits & incentives

Labor Market Information

Locating workforce & business development resources

Information on the Workforce Investment Act

Child Labor information

Information about services for individuals with disabilities

Training Program for a prospective employee

entitled Georgia Works

DOL-4E (R-4/11)