How can I help you?
 
Close opening pop up.
Message Pending Number. 1

Chat with us

Click here to chat with our Virtual Assistant
Skip to Main Content

2022 Annual Tax Rate and Benefit Charge Information - Unemployment Insurance

1. What tax table is in use for 2022?
Employers will be taxed under the Table C tax rate schedule. Table C is in effect for the 2022 calendar year as a result of federal funding allocated to replenish the Maryland Unemployment Insurance Trust Fund.

Table C includes rates that range from 1.00% to 10.50%. View Table C tax rate schedule.

  • The rate for new employers in 2022 is 2.30%.
  • The rate for a foreign contractor (new construction employers headquartered in another state) is 5.40%.
  • The standard (employer) rate is 10.50%.
  • The taxable wage base for 2022 is $8,500.

2. How are employer tax rates determined?
For unemployment insurance (UI) tax purposes, employers are considered contributory or reimbursable.

  • Contributory employers pay quarterly UI taxes based on benefit charges and taxable wages.
     
  • Reimbursable employers (government entities and certain non-profit organizations) may choose to reimburse the state for benefits charged against their account, instead of paying quarterly UI taxes.

Contributory employers are assigned one of three different types of tax rates listed below.

  • New Account (also called New Employer) Rate - This rate is assigned to a new employer and ranges from 1.00% to 2.60%.

    Note: New employers in the construction industry that are headquartered in another state are not assigned a typical new account rate. Instead, they are assigned the average rate for the construction industry in Maryland.
     
  • Experience (also called Earned) Rate - This rate is assigned after an employer has paid wages to employees in at least two fiscal years (July 1 to June 30) before the computation date.

    The computation date is the July 1 before the calendar year for which the rate is assigned. For example, the computation date for 2020 was July 1, 2019.
    The experience tax rate is calculated based on an employer’s benefit charges and taxable wages.
     
  • Standard Rate - This rate is assigned to an employer who is eligible for an earned rate, but has no taxable wages in a year because the employer failed to file quarterly tax and wage reports. The standard rate is the highest rate on the tax table in effect in a given year.

3. How are experience tax rates calculated?
For employers who are eligible for an experience rate, the tax rate is determined by the employer’s benefit ratio and the tax table in effect for the year.

The Maryland Division of Unemployment Insurance (DUI) determines an employer’s benefit ratio by dividing the employer’s benefit charges by their taxable wages (from the three fiscal years preceding the July 1 computation date).

The computation date is always the July 1 date before the calendar year for which the rate is assigned. Example: The computation date for calendar year 2020 was July 1, 2019. Fiscal years 2017, 2018, and 2019 were used to determine an employer’s 2020 experience tax rate.

Note: If an employer has only been in business for two fiscal years before the computation date, the benefit charges and taxable wages for those two years are used.

4. Will employers be charged for benefits awarded during the State of Emergency due to the COVID-19 pandemic?

Maryland state legislation passed to help ease the economic burden of the COVID-19 pandemic on employers. As a result, each employer will receive two tax rate calculations for 2022. The first rate is based on the fiscal years 2017, 2018, and 2019, and the second rate is based on the fiscal years 2019, 2020, and 2021. An employer will receive whichever rate is lower.

This method is similar to how employer tax rates were calculated in 2021, when employers received two rates: one which included fiscal year 2020 benefit charges; and another which omitted fiscal year 2020 benefit charges. In 2021, employers also received whichever rate was lower.

5. How are employer tax rates calculated for calendar year 2022?
In 2022, employers’ tax rate notices contain two calculations:

  • One based on pre-pandemic experience that excludes fiscal years 2020 and 2021; and
  • One based on normal experience that includes fiscal years 2020 and 2021.

Employers will receive the lower of the two rates.

Calculation with the state legislation:
An employer’s 2022 tax rate will be calculated based on their pre-pandemic experience, which excludes fiscal years 2020 and 2021 and instead uses the experience from the 2017, 2018, and 2019 fiscal years.

 

Fiscal Year Fiscal Year Period in Fiscal Year
2017 July 1, 2016 - June 30, 2017
2018 July 1, 2017 - June 30, 2018
2019 July 1, 2018 - June 30, 2019

 

Calculation without the state legislation:
An employer’s tax rate will also be calculated without the state legislation to ensure employers receive the lowest tax rate they are entitled to. This rate uses the experience from the 2019, 2020, and 2021 fiscal years.

 

Fiscal Year Fiscal Year Period in Fiscal Year
2019 July 1, 2018 - June 30, 2019
2020 July 1, 2019 - June 30, 2020
2021 July 1, 2020 - June 30, 2021

Each employer will receive the lower of the two rates identified on the rate notice. Please note that if an employer’s contribution rate is the same with the state legislation and without the state legislation, the employer’s rate will be determined with the state legislation. This means that the employer’s contribution rate will be calculated based on fiscal years 2017, 2018, and 2019.

6. With the federal funding allocated for the UI trust fund, will employers see an increase or decrease in their 2022 tax rates?
Due to the federal funding, employers will be taxed under Table C for the 2022 calendar year. Table C includes tax rates that are lower than the rates in Table F, which was in effect in 2021. However, an employer’s benefit charges and taxable wages also impact an employer’s UI tax rate.

7. When will employers receive their tax rates for calendar year 2022?
In January, DUI sends each employer an Experience Rate Notice, which informs an employer of their UI tax rate for the new calendar year. For 2022, employers should expect to receive this notice in mid to late January.

Employers may access their annual rate notice for 2022 in BEACON 2.0 by:

  • Selecting “Tax Rate Functions” from the portal left menu.
  • Then, select “Rate Notice.” See the screenshot below for an example.

An employer will also receive the notice via their preferred communication method.

BEACON 2.0 screen

8. Can an employer protest their annual tax rate?
Yes, employers can protest their assigned tax rates To do so, an employer can request a review determination within 30 days of the Date of Notice listed on the employer’s Experience Rate Notice. An employer can request a review either in BEACON 2.0 or by mail.

To request a review in BEACON 2.0:

  • Select “Tax Rate Functions” from the portal left menu.
  • Select “Rate Notice.”
  • Then, select “Protest” under Annual Tax Rate Calculation (at the bottom of the screen). See the screenshot below.

Annual Tax Rate Calculation

Send a request for review by mail to:

Division of Unemployment Insurance
Review Determination Unit
1100 N. Eutaw Street, Room 401
Baltimore, MD 21201

9. Will an employer be charged for fraudulent benefits?
No, neither contributory nor reimbursable employers will be charged for benefits that are determined to be fraudulent.

10. What should employers do if they believe a fraudulent charge is included on their benefit charge statement?
Employers should protest the benefit charge statement in BEACON 2.0
To protest the charge in BEACON 2.0:

  • Select Benefit Charge Functions
  • Choose the Year/Quarter hyperlink
  • Select the Claimant’s Social Security Number
  • Select Request Relief of Charges
  • Choose the reason for the protest
  • Type inside the box the reason for the protest. (There will be an option to upload a document to support the reason for the protest.)

Note: If fraudulent claims continue to be charged to your account, please e-mail ui.fraud@maryland.gov to report the fraudulent activity. The fraud unit will investigate and cancel the claim if it is determined to be fraudulent.

11. Can employers still protest a fraudulent claim on their benefit charge statement after the 30-day protest period has lapsed?
Yes, employers may protest a fraudulent claim even after the 30-day protest period has lapsed. Employers may file a protest after the 30-day protest period, however the protest must be submitted by mail:

Division of Unemployment Insurance
Review Determination Unit
1100 N. Eutaw Street, Room 401
Baltimore, MD 21201