Taxable Wage Base Increased To $9,500

An increase in Arkansas’ taxable wage base went into effect Jan. 1, and employers must make that change in the Employer Quarterly Contribution and Wage Report (Employment Security Department Form 209B) in their first-quarter report, which is due by April 30.

Act 353 of 2003 raised the base from $9,000 to $9,500 per calendar year. Beginning Jan. 1, 2004, the rate will be raised to $10,000.

Employers pay unemployment insurance taxes on the base amount of an employee’s salary. The employer reports the remainder of the employee’s salary as wages. The extra money brought in by raising the base amount will be used as unemployment compensation, if needed.

Arkansas unemployment insurance tax rates currently range from 0.8 percent to a maximum rate of 6.7 percent. The upper range indicates that more payments in unemployment insurance have been made from an employer’s account than tax has been paid for unemployment insurance.

For more information, call ESD at (501) 682-3268 or go online to http://www.state.ar.us/esd/.