November 01, 2017
Exercise Your Nonprofit's Tax Exemption for 2018
We all feel the rush of time around now, the holidays racing towards us followed by the ringing in of another new year. Before you know it, you’re wondering where the time went… for most 501(c)(3) organizations, November is the deadline month to exercise their state unemployment tax exemption for 2018. That means you need to act now.
Unlike for-profit organizations, 501(c)(3) nonprofits have the unique opportunity – as allowed by Federal law – to opt-out of the state unemployment tax system and instead only reimburse the state, dollar-for-dollar, if and when they have an actual unemployment claim. It can be a savings opportunity for many nonprofits who have lower claims than what they pay in state unemployment taxes—which are often driven up by for-profit organizations and other companies that go out of business, as well as state fund deficits and improper payments made in error.
The Unemployment Services Trust helps nonprofits to better manage their cash flow through proper claims administration and safety reserve building. With access to e-Filing capabilities, state-specific claims advice and a plethora of on-demand HR services, UST participants are able to streamline operations and reduce back-office paperwork burdens.
Last year alone, UST helped program participants save $27.8 million in unemployment claims costs. That’s millions of dollars more for the nonprofit sector and the communities they serve.
More than 2,200 of your nonprofit peers are already exercising their unique tax alternative with UST. Rather than overpay into the State unemployment fund – effectively subsidizing for-profit companies – wouldn’t it be more true to your mission to allocate that wasted overhead to your programs and services?
Submit your FREE Cost Analysis Formno later than November 15th in order to meet the state deadline for 2018 enrollment – which for most states is December 1st. Unfortunately, if a nonprofit misses the state deadline, they have to wait until the following year to exercise their tax exemption and join the UST program.