Unemployment Insurance Tax
Unemployment Insurance is a federal-state program developed in the 1930's.
Unemployment Insurance is exactly as the name implies - insurance. Benefits are paid to lighten the burden of unemployment to the unemployed individual, to maintain purchasing power in the community and to allow laid-off employees to remain located in the area so they will be available for re-employment. The program is designed to help stabilize the economy by preventing a sharp drop in consumer spending during periods of unemployment.
Montana's Unemployment Insurance program is financed by employers through a payroll tax. Employers pay the contribution tax based on gross wages paid to their employees for services performed in Montana.
The Unemployment Insurance contribution rates range from 0.0% to 6.12% depending on the employer's industry and experience. Experience rated employers are also liable for paying an administrative fund tax, at either 0.13% or 0.18% of taxable payroll, depending on their rate class.
Governmental agencies pay the administrative fund tax at 0.09% of total payroll.
Non-profit organization and governmental agencies that elect to reimburse
the unemployment trust fund pay the administrative fund tax at 0.08% of total
payroll.
