Bill > SF607

This bill modifies Iowa's unemployment insurance tax laws, primarily focusing on changes to how taxable wages and employer contribution rates are calculated. The bill reduces the percentage of statewide average weekly wage used to calculate taxable wages from 66.67% to 33.33%, and adjusts the calculation method to round to the nearest hundred dollars. For new employers, the bill changes the initial contribution rate ranks: nonconstruction employers will now start at the fourth benefit ratio rank (instead of the twelfth), and construction or landscaping employers will start at the ninth rank (instead of the twenty-first). The bill also simplifies the current reserve fund ratio calculation by using the total wages paid in covered employment during the entire preceding year, instead of the first four of five calendar quarters. Additionally, the bill introduces a new contribution rate table with nine ranks that more evenly distribute employers based on their benefit ratios, with lower ranks receiving lower contribution rates. The bill suggests that any savings employers receive should be used either to pay for employee salaries/benefits or as an alternative to unemployment benefits during seasonal unemployment periods. The changes will take effect on July 1, 2025.

Budget and Finance

Ways & Means (Senate)

https://www.legis.iowa.gov/legislation/BillBook?ga=91&ba=SF607