Unemployment Insurance Taxes :
The Unemployment Insurance Taxes program is a federal-state partnership based upon federal law, but administered by state employees under state law. Because of this structure, the program is unique among the country's social insurance programs. The Unemployment Insurance Taxes program is also unique in that it is almost totally funded by employer taxes, either federal or state – only three states collect taxes from employees.
Federal law defines certain requirements for the program. The Social Security Act (SSA) and the Federal Unemployment Tax Act (FUTA) set forth broad coverage provisions, some benefit provisions, the federal tax base and rate, and administrative requirements.
Each state designs its own unemployment insurance program within the framework of the federal requirements. The state statute sets forth the benefit structure (e.g., eligibility / disqualification provisions, benefit amount) and the state tax structure (e.g., state tax base and rate). |
