Unemployment Insurance Tax (FUTA/SUTA): Missouri

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

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

Summary

• Missouri law broadly defines employment for purposes of the Missouri Employment Security Law (MESL). An individual's services performed for compensation is considered employment subject to the MESL, unless the state Division of Employment Security (DES) determines that an independent contractor performed the service. In determining whether the individual is an independent contractor, the DES applies the common law test and the Internal Revenue Service's 20-factor test. See Determining Coverage.
• Employers are generally eligible for an experience rate after two full calendar years of liability under the MESL. An employer's experience rate is the ratio of the employer's account balance divided by its average annual taxable payroll. The rate ranges from zero to six percent, not including any applicable increases or decreases. See Experience Rating.
• Missouri law prohibits SUTA dumping and generally adopts the provisions of the federal model SUTA-dumping law. See SUTA Dumping.
• All covered employers are required to file quarterly contribution and wage reports even if they have a zero percent rate, did not pay any wages, or are a reimbursable employer. Penalties are imposed on employers that neglect or refuse to file reports. See Quarterly Reporting Requirements.
• An employer's unemployment insurance (UI) account will be charged for erroneous benefit payments made due to the employer's failure to timely or adequately respond to written requests for information regarding the underlying claim. See Benefit Overpayments.
• Missouri employers must maintain an extensive number of true and accurate payroll records. The records must be available for inspection at the request of the DES and they must be kept for three years. See Recordkeeping Requirements.