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Tax tips are provided as a resource for helpful hints and time-saving suggestions when registering, filing and paying your unemployment taxes and managing your unemployment tax account.
Registered users of Unemployment Tax Services, the free Texas Workforce Commission (TWC) online system, should update their profile any time they change their email address. Maintaining an updated email address allows you to reset your password by email instead of having to call for assistance. TWC also uses the email address as a means of communicating with employers.
Updating a profile is quick and easy. After logging in to Unemployment Tax Services, select the “My Profile” link from the upper right hand corner of any page. Next, enter the new email address and then submit.
The annual report and contribution for domestic accounts that have requested annual filing is due on or before January 31, 2016.
The online version of the annual report is available now for those domestic employers who elected to file and pay their state unemployment tax annually. TWC encourages Annual Domestic Filers to file their annual report and pay their tax due online by using Unemployment Tax Services, a free online service. During the quick and simple registration process, new users create a User ID and password that will be used each time they access the online system. To register for access and to learn about other online services, visit our Unemployment Tax Services website.
Domestic employers electing to file reports annually will receive 2016 tax rates in March of 2016.
Tax Rate notices have been mailed. When you receive your notice, please forward a copy to your Service Agent, CPA, or bookkeeper so they can update their files. If you use "QuickFile or Intuit" you will need to update your software to show the correct Tax Rate.
With continued economic growth and prosperity in our state, Texas Workforce Commission (TWC) has taken steps to minimize increases in the overall unemployment insurance tax bill to Texas employers and to make responsible decisions that will result in savings to businesses in Texas.
At the end of 2010 and 2014, TWC sold bonds through the Texas Public Finance Authority in order to avoid interest that would have become due on federal advances. Although employers will see an obligation assessment added to the unemployment tax bills to repay the bonds, we are keeping employers’ taxes as low as possible by spreading this over a period of several years. The bonds, originally due to mature in July 2020, are on schedule to be retired in July 2017.
The components of your 2016 tax rate are:
You may be able to reduce your taxes for 2016. If TWC paid benefits to your employees who were laid off or separated through no fault of their own, you may find it beneficial to “buy down” the tax rate. Please visit our web site at www.texasworkforce.org and click on the Businesses and Employers menu link for more information or access the voluntary contribution analysis through Unemployment Tax Services.
At TWC, we work hard to minimize your unemployment insurance costs. In addition to lowering the tax burden, TWC is taking an aggressive approach to eliminate fraud, waste, and abuse of all kinds in the programs the agency administers. By reporting new hires immediately to the state Attorney General’s office, responding promptly to notices when a former employee applies for unemployment benefits and responding to earnings information requests on claimants, you can help us avoid overpayments and fraud which costs all employers.
TWC works closely with local workforce development boards across Texas to fill job openings with qualified unemployed workers, and we fund training to upgrade the skills of workers to better match area employers’ needs. TWC also works closely with economic development organizations to support existing Texas companies and to bring new business to the state. We pledge our continued efforts in helping to keep taxes as low as possible in order to promote a thriving Texas economy.
Texas Workforce Commission
Austin, Texas 78778
In accordance with Texas Labor Code 104.004 (a) and HB 2360 passed during the 81st Texas Legislative Regular Session, employers (a person who employs 1 or more employees) must notify all of their employees (an individual who is employed by an employer for compensation) of the federal earned income tax credit (EITC) general eligibility requirements, no later than March 1st of each year. The EITC is a refundable federal income tax credit for low to moderate income working individuals and families.
How may an Employer provide notice to its employees?
1. In person;
2. Electronically at the employee’s last known e-mail address;
3. Through a written or electronic flyer included as a payroll stuffer; or
4. By mailing the information to the employee at the employee’s last known address by United States first class mail.
Employers may use IRS Notice 797, or a written statement with the same wording as IRS Notice 797 when notifying employees. IRS – Notice 797 provides employees with the basic information for EITC. For more information and guidelines visit: http://www.eitc.irs.gov/Partner-Toolkit/employer .
There are several websites created to assist employees with additional information, eligibility requirements, general overview and income guidelines for EITC.
For more information, go to: http://www.eitc.irs.gov/ or, http://www.twc.state.tx.us/welref/wrjseek.html .
Computation of the 2016 unemployment insurance tax rate is based on your employment experience for the past twelve calendar quarters. Benefit payments charged to your tax account and taxable wages, which you have reported and on which you have paid taxes, are used in the computation.
The Labor Code, Texas Unemployment Compensation Act, provides that only taxable wages on which taxes have been paid by October 31, 2015 can be used to compute your tax rate. If you have unreported wages or unpaid taxes that are due from the twelve quarters proceeding October 1, 2015, you are encouraged to submit your report(s) and payment by October 31, 2015. Failure to pay unemployment insurance taxes may cause your 2016 tax rate to increase.
Workers should be properly classified as employees or independent contractors. Penalties could be imposed on a person who contracts for certain services with a governmental entity and who fails to properly classify their workers. This applies to subcontractors as well. Contractors and subcontractors who fail to properly classify individuals performing work under a governmental contract will be penalized $200 for each individual that has been misclassified. Governmental entities may want to include information on this new misclassification penalty in their contracts with entities that are providing services covered by this requirement.
Review our 20-point comparative approach as a guide to determine if a worker is an employee or an independent contractor.
Misclassification of certain workers is outlined in the Texas Unemployment Tax Act (TUCA), Section 214.008.
If you have questions about penalties for worker misclassifications, please contact your nearest Texas Workforce Commission Tax office.
Each employer must keep employment and payroll records that include all the information in TWC’s Payroll Records Requirements. The records may be inspected and copied by TWC or an authorized representative at any reasonable time and as often as necessary. Section 301.081 of the Texas Unemployment Compensation Act (TUCA) authorizes TWC to conduct a tax audit.
TWC may require reports regarding employees as necessary for the effective administration of the Texas Unemployment Compensation Act (TUCA).
Employment and payroll information TWC obtains may not be published and is not open to public inspection. However, a public employee may access the information as required for the proper administration of their duties, consistent with TWC rule and federal law.
The primary objectives of an unemployment insurance employer tax audit are to:
If you have questions about the audit process, contact your nearest Unemployment Tax Office
The Texas Workforce Commission is committed to safeguarding information submitted by Texas businesses.
When providing payroll data to Texas Workforce staff, it is important that you provide the information to the appropriate Field Representative. You can find the name and phone number of your TWC Field Representative by logging on to our “Unemployment Tax Services” system at https://apps.twc.state.tx.us/UITAXSERV/security/logon.do and selecting the “Account Info” tab. Once on the ‘Account Info” tab, select “Tax Account Profile” scroll down to “TWC Contact” for the name, address and phone number of your Field Representative.
You can also obtain the address and phone number of your nearest Unemployment Tax Office online.
Employers with locations and employees in multiple states often encounter the issue as to which state to report the wages of their employees for unemployment tax purposes.
For assistance in making this determination, please see the location of services checklist available at Texas Workforce Commission website: www.twc.state.tx.us/ui/tax/location-services-checklist.html.
If you have questions, contact your nearest Unemployment Tax Office.
Periodically Unemployment Tax Service Account Administrators should review the User List and for each account they Administer.
If you have questions about the removal of associations process, contact your nearest Unemployment Tax Office.
User ID’s and passwords function as security for your account. When signing up for a User ID, create a User Id and password that you will remember. Protect your User ID and Password combination and do not share your password with others. The User ID and password combination will be required to ‘open’ your access to UTS each time you log on.
If you file reports for more than one employer, you only need one valid User ID/password combination.
Then, when you log on to UTS you simply select the employer account you need by choosing from My Employers.
If you have trouble accessing UTS please be aware that both a Forgot Password and Forgot User ID are available for your assistance.
You can accomplish many things online using the Unemployment Tax Services (UTS) system. Simply go to our website www.texasworkforce.org/uts under the Logon to File Reports, Pay Taxes & More
If you do not have a User ID and Password set up for any of the TWC websites, click on the Sign up for a TWC Internet User ID and follow the instructions.
One individual can be designated as the account administrator, having permission to do everything allowed via UTS. Other users may request access to an account. The account administrator then grants the requestor access and various levels of permission under the Applicant List quick link of the User Admin tab.
With proper permission granted, you can select the Report Filing (C3) tab to file your quarterly report. In the Quick Links box, you can view previously filed wage reports via wage report history, view chargeback history, adjust your wage reports and view the adjustment history.
You can select the Account Info tab to update your company’s information and you can find all contact details for your TWC contact person. In the Quick Links box, you can view the tax account profile, the tax rate summary and the tax account activity. Additionally you can update your address, update or close your tax account, and request forms.
There is also an Appeal Status tab if you wish to check on any pending or upcoming appeals that involve your account.
Should you require assistance with access or have questions about using the TWC Unemployment Tax Services website, you may contact your local TWC Accounts Examiner or Central Tax Operations at (512) 305-9667.
All workplace compliance posters required by law are available through TWC online at: www.texasworkforce.org/ui/lablaw/posters-workplace.html. We have removed account specific information from the compliance posters, enabling employer’s to print copies online. Government-issued compliance posters do not have to be laminated to satisfy an employer’s regulatory obligation.
Employers do not need to purchase these posters from private vendors; they are always free of charge. TWC has investigated reports of vendors claiming to be state contractors, implying that employers are not in compliance with state law and urging employers to buy the posters from the vendor. TWC advises employers to disregard these vendors and consult with TWC directly to determine which posters are needed.