The Illinois Department of Employment Security (IDES) will issue $15 million in credits to thousands of new employers within eight industries which were incorrectly charged higher unemployment tax rates since 2013. During routine preparation of tax rates for calendar year 2016, the Department discovered calculation errors in its system program that erroneously inflated average industry tax rates for 2013 through 2015, impacting employers in the administrative, support/waste management, construction, company management, manufacturing, mining, information, transportation/warehousing, and unclassified industries. Impacted employers who already paid taxes at the incorrect higher rates will be credited for their overpayments towards their next quarterly contribution.
The Department discovered system errors that incorrectly increased the average industry tax rates. In some instances, employers who should have been subject to the standard new employer rate were incorrectly assigned a higher rate. In other instances, although the employer should have been assessed at the average rate for its industry, the rate initially assigned for the industry was too high.
New rates notices are being issued by the Department and will be mailed in the remaining weeks of October. Credits will be automatically calculated and credit notices will be issued by December. The department has also indicated plans to automatically refund any credit amounts that are less than $1000.00 sometime in late November Early December. Refunds for higher amounts can be requested via the standard refund request form. New Rates Notices for 2015 will be issued later in October and the revised rates will be applicable for the Fourth Quarter of 2015.
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This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.