Skip to Content
0
A J
Dec 10, 2011 at 12:59 AM

FUTA Changes Effective 1st July 2011 - Not self Adjusting***Critical

54 Views

Hello

As we know the FUTA rate was chnaged effective 1st July 2011 from 0.8% to 0.6%(after SUTA offset), we have noticed that currently in the SAP the FUTA contribution is not self adjusting.

As illustrated in below example

OCT 2011 Earnings 2008.13(FUTA paid at old Rate 0.08%-16.07)

NOV 2011 Earnings 2008.13(FUTA paid at old Rate 0.08%-16.07)

After November payroll new FUTA rate has been implemented.SAP calculation as below

DEC 2011 Earnings 7008.13(FUTA paid at new Rate 0.06%-16.07)

Dec calculation = 7000-4016.26= 2983.74*0.006=17.90

As you can see employee has contibuted 50.04(16.0716.0717.90) which is more than the minimum of 42 USD(7000*.006)

Could you please confirm if this is correct behaviour? I remember checkin with BSI back in July and they confirmed that the self adjusting should happen and employee should not contribute more than 42

Can you please confirm

Regards

Ajay