Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for employers Example 5-8 Applebaum Security Company is located in State H, which enables employers to reduce their contribution rates under the experience-rating system. From 2003 to 2012, inclusive, the company's total contributions to state unemployment compensation amounted to $18,135. For the calendar years 2013 to 2016, inclusive, the contribution rate for Applebaum was 3.7% The contributions of each employer are credited to an account maintained by the State Unemployment Compensation Commission. This account is credited with contributions paid into the account by the employer and is charged with unemployment benefits that are paid from the account. Starting January 1, 2017, the contributions rate for all employers in State H will be based on the following tax-rate schedule: Reserve Ratio Contributions falling below benefits paid 0.0% to 7.9% 8.0% to 9.9% 10.0% to 11.9% 12.0% to 14.9% 15.0% or more The annual payroll for calculation purposes is the total wages payable during a 12-month period ending with the last day of the third quarter of any calendar year. The average annual payroll is the average of the last three annual payrolls. The SUTA tax rate for the year is computed using the information available (benefits received and taxes paid) as of September 30 of the preceding year Contribution Rate 5.5% 4.5% 3.5% 2.5% 1.5% The schedule below shows the total payroll and the taxable payroll for the calendar years 2013 to 2016 Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for employers Example 5-8 Applebaum Security Company is located in State H, which enables employers to reduce their contribution rates under the experience-rating system. From 2003 to 2012, inclusive, the company's total contributions to state unemployment compensation amounted to $18,135. For the calendar years 2013 to 2016, inclusive, the contribution rate for Applebaum was 3.7% The contributions of each employer are credited to an account maintained by the State Unemployment Compensation Commission. This account is credited with contributions paid into the account by the employer and is charged with unemployment benefits that are paid from the account. Starting January 1, 2017, the contributions rate for all employers in State H will be based on the following tax-rate schedule: Reserve Ratio Contributions falling below benefits paid 0.0% to 7.9% 8.0% to 9.9% 10.0% to 11.9% 12.0% to 14.9% 15.0% or more The annual payroll for calculation purposes is the total wages payable during a 12-month period ending with the last day of the third quarter of any calendar year. The average annual payroll is the average of the last three annual payrolls. The SUTA tax rate for the year is computed using the information available (benefits received and taxes paid) as of September 30 of the preceding year Contribution Rate 5.5% 4.5% 3.5% 2.5% 1.5% The schedule below shows the total payroll and the taxable payroll for the calendar years 2013 to 2016