Unemployment Insurance Tax (FUTA/SUTA): Kansas

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

Authors: Alan L. Rupe, Aaron Sauerwein, Kutak Rock LLP

Summary

• Kansas uses the Internal Revenue Service's Common Law Test to determine who is an employee for employment tax purposes. See Common Law Test.
• Employers pay contributions to the state unemployment insurance fund based on their experience rate, up to an annual taxable wage base, for each employee. Experience rates are based on an employer's potential risk of unemployment. See Taxable Wage Base; Contribution Rates; Experience Rating Method.
• Kansas prohibits employers from illegally obtaining, or attempting to obtain, a reduced unemployment insurance contribution rate. Substantial penalties are imposed for violations. See SUTA Dumping.
• Employers may make voluntary contributions, in addition to required contributions, to reduce their unemployment insurance rate. Kansas also allows the transfer of the unemployment experience of a trade or business to an employer that acquires that trade or business, or any portion of it, if the two employers have substantially common ownership, management or control at the time of transfer. See Voluntary Contributions; Joint or Combined Accounts.
• Employers are required to file quarterly wage reports for any quarter in which they pay wages that are subject to state unemployment insurance tax. Most employers must file these returns electronically. Penalties are imposed for noncompliance. See Quarterly Reporting Requirements.
• An employer's account will be charged for overpayments resulting from the employer's failure to properly respond to information requests. Employers are not responsible for unemployment claims or benefits paid that the Department of Labor determines are fraudulent or improper payments. See Benefit Overpayments.
• Kansas employers that operate from more than one location under one Unemployment Insurance Account Number are required to complete and submit a Multiple Worksite Report (BLS 3020). See Multiple Worksite Reporting.
• Employers are required to keep payroll records that provide a true and accurate account of all workers and all payments made for at least five years. Records must also include certain required information for each employee. See Recordkeeping Requirements.