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Oregon businesses can now receive unemployment tax relief

Governor Kate Brown signed a bill into law on Tuesday that allows businesses to get relief or defer payment on 2021 unemployment insurance taxes.

Posted: Jul 28, 2021 11:53 AM
Updated: Jul 28, 2021 11:59 AM

SALEM, Ore. — Oregon businesses will now be able to seek relief or defer some payments on their 2021 unemployment insurance payroll taxes, the Oregon Employment Department says. Governor Kate Brown signed House Bill 3389 into law on Tuesday, which brought these additional options to bear.

“There is no question that Oregon’s economic backbone, our small businesses—as well as the hardworking Oregonians employed at those businesses — were deeply impacted by the pandemic,” said Governor Brown. “But through these challenging times, we’ve seen Oregonians respond with creativity and resilience. As we’ve entered the next chapter of the pandemic and look to economic recovery, HB 3389 should provide some relief for businesses, while at the same time ensuring we can continue to provide unemployment insurance benefits to all Oregonians who need them.”

The amount of 2021 UI taxes that employers are eligible to defer or have forgiven depends on how much their UI tax rate increased from 2020 to 2021:

  • 0.5% to 1% increase in UI tax rates will be eligible for deferral only
  • Tax rate increased more than 1.0 percentage point and not more than 1.5 percentage points will be eligible for 50% of their deferrable UI taxes forgiven
  • Tax rate increased more than 1.5 percentage points and not more than 2.0 percentage points will be eligible for 75% of their deferrable UI taxes forgiven
  • Tax rate increased more than 2.0 parentage points will be eligible for 100% of their deferrable UI taxes forgiven

The payroll tax relief plan allows for three benefits. For the 2021 tax year, employers can defer one-third of their unemployment tax liability until June 30 without interest or penalties. Those deferred taxes may be forgiven, depending on how much an employer's UI tax rate increase from 2020 to 2021.

Also, an employer's "tax experience rating" from 2022 through 2024 will be rolled back to the employer's pre-pandemic experience rate. Tax rates are likely to fluctuate over the next several years due to schedule changes, but the employer's rate will be locked to their rating before the pandemic.

“Oregon’s small businesses urgently needed this legislation,” said Anthony Smith, Oregon state director of the National Federation of Independent Business. “With the state now open for businesses again, HB 3389 will aid in the state’s economic recovery from the crippling consequences of the COVID-19 pandemic by allowing employers to invest in their business operations, their employees, and their communities. Its significance cannot be overstated.”

Employers must meet several following conditions to be eligible for UI tax deferral and forgiveness. As of January 1 of this year, they must have paid all outstanding UI tax contributions and related liabilities, including those determined in a payment plan accepted by the director of the Oregon Employment Department. They must also file all required payroll reports for 2021 on time, and pay all tax liabilities on time for 2021 that are not deferred or forgiven.

Businesses do not need to apply for this tax relief — OED says that it will automatically enroll eligible employers, and will contact them throughout the tax year with updates or changes to their status or requirements.

OED also included one caveat: participation in the deferral portion of this relief plan could negatively affect an employers’ Federal Unemployment Tax credit. Some employers may be unable to access the full credit for state unemployment tax paid on their IRS Form 940 (Federal Unemployment Tax Return) if they pay state unemployment taxes after the Federal Form 940 due date.

Oregon Coronavirus Cases

Data is updated nightly.

Cases: 391099

Reported Deaths: 5161
CountyCasesDeaths
Multnomah60298839
Washington41981395
Marion39886506
Clackamas32773378
Lane30113355
Jackson24880360
Deschutes23557185
Umatilla15126180
Linn14637179
Douglas13375291
Josephine10148244
Yamhill9762143
Klamath9053146
Polk8212100
Benton609738
Malheur592487
Coos5664106
Columbia430455
Jefferson420266
Lincoln362152
Union338755
Crook334056
Wasco316146
Clatsop261835
Baker219833
Tillamook216645
Hood River213737
Morrow197525
Curry191939
Harney119933
Grant108515
Lake105416
Wallowa75713
Sherman1913
Gilliam1854
Wheeler1141
Unassigned00

California Coronavirus Cases

Data is updated nightly.

Cases: 5083462

Reported Deaths: 74473
CountyCasesDeaths
Los Angeles152713227166
San Diego4069274335
Riverside3876785358
San Bernardino3745435962
Orange3343985725
Sacramento1683542443
Kern1576621804
Fresno1567952254
Santa Clara1520891925
Alameda1251761504
San Joaquin1075591834
Ventura1040031190
Contra Costa1037721046
Stanislaus915481417
Tulare860871096
San Francisco56909669
San Mateo56320629
Monterey52488626
Solano47671357
Santa Barbara47293549
Merced45053667
Sonoma43168412
Placer42141470
Imperial38477773
Kings35206363
San Luis Obispo31476359
Madera26194311
Shasta26081451
Butte25455314
Santa Cruz22248224
Yolo21558257
Marin18465249
El Dorado18301166
Sutter14571186
Napa13420104
Yuba1076089
Tehama10275130
Humboldt10158119
Nevada10019105
Mendocino857197
Lassen796756
San Benito781578
Tuolumne773090
Lake7043110
Amador577366
Siskiyou474755
Glenn457436
Calaveras441588
Del Norte375542
Colusa325220
Inyo256646
Plumas19367
Mono18784
Mariposa160018
Trinity99717
Modoc7655
Unassigned3220
Sierra2180
Alpine1080
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