Pennsylvania Continues Employer Surcharges for Unemployment Contributions

Due to the insolvency of the Pennsylvania Unemployment Trust Fund, employers will be assessed various add-ons to their basic contribution rate in 2012. These add-ons are the same percentages assessed in 2011.

A surcharge adjustment of 5.8% will be assessed to the employer’s basic contribution rate. For example, an employer with a basic contribution rate of 7% would be assessed a surcharge adjustment of .406%. This component of the experience rate is established by a formula and is the same for all employers. The formula divides the unemployment fund balance (as of June 30) by the average benefit costs for the last three years (known as the “trigger mechanism”). A resulting percentage of less than 50% triggers a surcharge of 5.8%.

An additional contribution factor of .65% will be added to the employer’s experience rate. This contribution is determined annually by the same “trigger mechanism” formula.

Lastly, an interest factor of .44% is anticipated to be added to the employer’s experience rate in 2012 (same amount as 2011). This is the component of the experience rate created to generate necessary revenue to satisfy interest payments on outstanding loans Pennsylvania has with the federal government. The outstanding loans also create a reduction in the credits that can be claimed against the Federal Unemployment Tax (FUTA). Employers can normally claim a 5.4% credit against the 6% FUTA. The credit is reduced to 5.1% due to the outstanding federal loans.


© 2011 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

This advice is not intended or written to be used for, and it cannot be used for, the purpose of avoiding any federal tax penalties that may be imposed, or for promoting, marketing or recommending to another person, any tax related matter.

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2019 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on

The IRS turns its focus to cryptocurrency
Kress Case Addresses S Corporation vs. C Corporation Issues
Not-for-Profit, Tax BY Preet Mann
Mandatory E-Filing of Nonprofit Tax Returns
Tax Credits for Plug-In Electric Drive Vehicles
2019-2020 Pennsylvania Budget
Due to Feedback, IRS is Brainstorming Other Ways to Calculate the Tax on Parking

Register to receive our weekly newsletter with our most recent columns and insights.

Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us

contact us

Map of Pittsburgh Office

One PPG Place, Suite 1700
Pittsburgh, PA 15222
p:412.261.3644     f:412.261.4876

Map of Columbus Office

65 East State Street, Suite 2000
Columbus, OH 43215
p:614.621.4060     f:614.621.4062

Map of Washington Office
Washington, D.C.

1660 International Drive, Suite 600
McLean, VA 22102