It will be a couple more years before Nevada's unemployment fund is solvent. 

The fund used to pay benefits to the state's jobless remains well below the threshold identified as the point where it becomes solvent, according to the Las Vegas Sun. In fact, the fund will remain insolvent until at least 2018 or 2019. The information on the state of Nevada's unemployment insurance benefits was given to the Nevada Employment Security Council ahead of its October decision on whether to raise unemployment taxes for employers in an effort to pay off debt it owes the federal government. The final decision on how much employers will have to pay into the state unemployment fund will be made by Renee Olson, the employment security division administrator. 

"UI taxes will help the unemployment fund become solvent again."

Unemployment taxes in the Silver State
Any business that pays more than $225 in annual wages must register with the Employment Security Division, and pay taxes on those wages, according to the Nevada Department of Employment, Training and Rehabilitation. Right now, newer businesses in the state pay an unemployment tax rate of 2.95 percent of wages paid to each employee up to the taxable wage limit. After 14 to 17 calendar quarters, this rate will change based on the employer's "experience rating." 

The taxable wage base that businesses' rates are determined from is equal to just over 66 percent of the average annual wage for Nevada employees. In 2015, the taxable wage base in the state is $27,800. 

On average, employers pay a 2 percent unemployment tax rate, the Las Vegas Sun explained. This brings the average tax paid per employee to $711. The rate that employers may pay ranges from 0.25 percent to 5.4 percent, with the exact figure depending on how much turnover the business experiences. 

Paying off a debt to the federal government
The taxes businesses pay on wages will, eventually, help Nevada's unemployment fund become solvent again. Scott Kennedy, chief of unemployment insurance for the state, explained that the trust fund requires $1.2 billion to be considered solvent, the news source reported. It currently stands at $341.3 million. 

During the recession Nevada had the highest unemployment rate in the country at 14.4 percent, and the unemployment fund ended up drained. To maintain weekly unemployment benefits payments, the state had to borrow $800 million from the federal government. The $600 million bond issued by the state to help cover its debt to the federal government should be paid off by 2017, Kennedy explained, according to the Las Vegas Sun. 

At Corporate Cost Control, we work closely with employers across the country to better manage the nuances of unemployment insurance. Legislation changes on the state level could impact you today, and we welcome any questions or concerns you may have on a wide range of topics.

Contact CCC to learn how we can save your organization time and money (800) 207-6926

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