Limit Credits for State Unemployment Insurance

If an employee has a change in their work state within the same tax reporting unit (TRU), the payroll process automatically handles the state-specific state unemployment insurance (SUI) limits, including granting applicable credit for the wages earned in the other state.

Note: Not all states allow this credit. In these cases, the payroll process doesn't calculate the credit. For further info, refer to your state tax authority.

Once those limits are reached, the payroll process stops the SUI deductions. It automatically adjusts the new state's SUI limit for the SUI wages you paid in the other state. This means SUI wage base rate overrides aren't necessary.

Configure Your Organization

You can change how the payroll process grants or denies SUI wage credits. You can set these overrides at the PSU and TRU levels.

1. To set it for a PSU, start the Legal Entity Calculation Cards task from your implementation project.

   To set it for a TRU, start the Legal Reporting Unit Calculation Cards task from your implementation project.

   Values you set at lower levels override those at higher levels.

2. Select State Unemployment for the state you're updating.

   Add it if doesn't already exist.

3. Click Enterable Calculation Values on Calculation Cards.

4. Click Add.

5. From Display Value, select Credit Employer SUI Wages Earned in Other States.

   For states that also have employee SUI tax, such as Pennsylvania, do this for Credit Employee SUI Wages Earning in Other States as well.

6. For those states that give credit, enter N in Value to revoke it.

   For those states that don't give wage credit, enter Y to begin granting it.

7. Click OK.

8. Click Save and Close.

Configure Individual Employees

For the states of Maryland, North Carolina, Oregon and Washington you can also update this info on the employee's tax card if they work in those states.

1. From My Client Groups, click Payroll.

2. Click Calculation Cards.

3. Search for and select the person.

4. Open their Tax Withholding card for editing.

5. Select Edit for the state component you're editing.

6. In Withholding Exemption, identify if the state grants SUI wage credits.

7. Click Save and Close.

Configure Self-Adjustment Settings

For states that regularly perform midyear changes to their SUI tax rates, configure your organization card to use the quarterly self-adjustment method. By checking each quarter individually to determine adjustments, the payroll process maintains the integrity of the calculations prior to the change.

For further info, see Self-Adjustment Methods for Tax Withholding in the Help Center.