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Wyoming’s State Unemployment Taxes Increasing in 2024

By October 24, 2023February 27th, 2024No Comments

Recent changes to the State Unemployment Tax Act (SUTA) wage base in Wyoming are set to significantly impact nonprofits across the state. Understanding this change and knowing how to navigate its implications will be crucial in ensuring nonprofit organizations remain fiscally responsible in 2024.

The Headlining Change: Wyoming’s 2024 SUTA Wage Base

The most pressing news is the uptick in Wyoming’s unemployment-taxable wage base. Effective for the calendar year 2024, the wage base will increase from its previous amount of $29,100 to a new figure of $30,900. This notable change was announced on September 29 on the state’s workforce services website.

This is the 21st straight year the wage base has been increased in Wyoming.

To clarify, the unemployment-taxable wage base is the yearly cap on the amount of an employee’s wages that can be subjected to state unemployment insurance taxes. This figure is recalibrated annually in Wyoming, with the state’s average annual wage serving as a guiding metric.

How This Change Affects 501 Nonprofit Organizations

This increase has immediate ramifications for nonprofits. In simple terms, organizations will be accountable for unemployment taxes on an additional $1,800 of each employee’s earnings compared to the previous year.

When considering this increase across all employees, particularly in larger nonprofits, the financial repercussions can add up swiftly.

Exploring the Reimbursement Strategy

Facing this wage base hike, 501(c)(3) nonprofits can be proactive in seeking strategies to manage these augmented costs. This is where reimbursing unemployment offers a potential solution.

Rather than contributing to state unemployment taxes at a set rate, 501(c)(3)s have the distinct option to adopt the reimbursement method. Under this approach, nonprofits directly reimburse the state only for the actual unemployment benefits paid out to former employees. Advantages of this method include:

  1. Cost Savings: For organizations with a history of low unemployment claims, the reimbursement method can result in tangible cost savings versus standard SUTA tax payments.
  2. Direct Expense Oversight: This method offers greater visibility and control over unemployment-related expenses, as you’ll be accountable only for real claims, not prepaid estimates.
  3. Mitigating Future Increases: The fewer unemployment claims your organization has, the lower your future costs may be. Efficiently managing these claims can help stave off the compounding effects of rising SUTA costs.

501 Can Help

The forthcoming SUTA wage base increase in Wyoming is undeniable, making it vital for 501(c)(3) executives to stay informed and be strategic.

501(c) Services has more than 40 years of experience helping nonprofits with unemployment outsourcing, reimbursing, and HR services. Two of our most popular programs are the 501(c) Agencies Trust and 501(c) HR Services. We understand the importance of compliance and accuracy, and we are committed to providing our clients with customized plans that fit their needs.

Contact us today to see if your organization could benefit from our services.

Already working with us and need assistance with an HR or unemployment issue? Contact us here.

(Photo by Lukas Kloeppel)

The information contained in this article is not a substitute for legal advice or counsel and has been pulled from multiple sources.

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