Unemployment Insurance Tax (FUTA/SUTA): Idaho

Federal law and guidance on this subject should be reviewed together with this section.

Authors: Scott Randolph, Holland & Hart LLP

Summary

• Idaho uses its own test to determine who is an employee for state unemployment insurance (SUI) tax purposes. See Test for Employee Status.

• The law defines wages for SUI purposes as all compensation for personal services, including salaries, commissions, bonuses and the cash value of all compensation paid in any medium other than cash. The annual total SUI tax rate is based on a range of rates. See SUI Taxable Wages; Contribution Rates.
• All employers start contributing at the standard rate, which can be adjusted after the first six calendar quarters. Changes to employers' contribution rates depend on employers' experience rates and their relationship to the experience rates of all other Idaho employers. See Contribution Rates; Experience Rating Method.
• Under Idaho's SUTA dumping law, employers may not manipulate the experience rating system to receive a lower contribution rate than would otherwise be required. Employers that knowingly attempt to manipulate businesses to get a lower tax rate are liable for serious penalties. See SUTA Dumping.
• Idaho law does not permit employers to make voluntary contributions to lower their SUI tax rates. See Voluntary Contributions.
• Wages subject to the unemployment insurance tax must be reported quarterly. In addition, employers that operate more than one establishment in Idaho may be requested to submit Multiple Worksite Reports. See Quarterly Reporting Requirements; Multiple Worksite Reporting.
• An employer's account will be charged for overpayments caused by the employer's failure to properly respond to requests for information about benefit claims. See Benefit Overpayments.
• Employers are required to keep records for five full years after the calendar year in which wages are paid. Records are subject to unemployment insurance audits. See Recordkeeping Requirements.