Information for COVID-19 FAQ, Employers, Jobseekers, Self-Employed and Child Care

Overview

Tax tips are provided as a resource for helpful hints and time-saving suggestions when registering, filing and paying your unemployment taxes and managing your unemployment tax account.

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June 2020

Confidentiality and Third-Party Preparers

Employer security protocol and State confidentiality laws will not allow Tax personnel to release confidential information to a third-party who does not have Written Authorization on file with this Commission representing a specific account.

Any business or employer that wants to grant an individual or service company the authority to represent them in matters before TWC should submit the Written Authorization to Represent Employing Unit which can be found at Written Authorization to Represent Employing Unit (Form C-42).

The written authorization form must be signed by the:

  • Individual, if the grantor is a sole proprietor
  • Owner or an officer of an organization or a partner of a partnership
  • Fiduciary or trustee for a trust or estate

 

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May 2020

Workers Refuse to Return to Work

If you attempted to rehire a former employee and they refused to return to work, you need to report the incident to the Texas Workforce Commission (TWC).  We need to know the following information:

  • Job offered
  • Date when job was offered
  • Number of hours they would be working
  • Pay (was it the same as before COVID-19) and
  • If the worker refused due to safety concerns, the steps the employer has taken to ensure the safety of the workers and customers.

You may send the information to twc.fraud@twc.state.tx.us or call 1-800-252-3642. TWC will investigate and determine if the claimant has refused suitable work.

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April 2020

Quarterly Contribution Report Extended Due Date

In response to the recent impacts of COVID-19, the Texas Workforce Commission (TWC) will be extending the due date for the First Quarter 2020 report filing and tax payment until May 15th, 2020.

In an effort to assist with the unprecedented amount of internet traffic that both our claimant and employer systems are experiencing, we ask that all employers PLEASE DO NOT START FILING your 1ST Quarter 2020 TAX REPORT UNTIL after APRIL 15, 2020.  Reminder: The First Quarter 2020 Report deadline has been extended to May 15th, 2020.

This will allow uninterrupted internet access for individuals filing for unemployment and help ensure employers have access to their online accounts.

If you feel that you will be unable to file by the extended deadline of May 15th 2020 or have any further questions please email the Tax Department.

You may also follow along and check for updates on our web page COVID-19 Resources Employers.

We are here to help all Texans during these difficult times.

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March 2020

Why Am I Being Audited? 

The Texas Workforce Commission is responsible for the effective administration of the Texas Unemployment Compensation Act (TUCA). The Tax Department conducts routine audits of businesses to ensure compliance with unemployment laws. This helps provide for a level playing field among businesses by enforcing tax compliance equitably. Since part of the tax rate calculation is used to replenish the unemployment trust fund, it is important that all liable employers pay the correct amount of taxes due for their employees.

Employer Audits may be based on random selection, referrals from other departments, other state and federal agencies, and the public.

The primary objectives of an unemployment insurance employer tax audit are to:

  • Ensure compliance with the taxing provisions of the Texas Unemployment Compensation Act.
  • Foster understanding by employers of the unemployment compensation law.
  • Establish a relationship between TWC and the employer through the distribution of information related to the unemployment insurance program.

Note: Information obtained by TWC in an audit is not published and is not open to public inspection.

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February 2020

Limited Liability Companies - Reporting Requirements

A Limited Liability Company (LLC) is a unique legal entity that meets the definition of an employer.

Any persons receiving remuneration for services rendered to a Limited Liability Company – including owners or members – are defined as employees and their wages are reportable and taxable. 

Distributions of profits based on formulas established in the Limited Liability Company's articles of organization are exempt from reporting to TWC.

Federal law and IRS classification has no bearing on the state interpretation of an LLC in Texas since LLCs were recognized in Texas under state legislative action.  For a detailed explanation of the Tax Department’s interpretation of this issue, please visit our Tax Law Manual: Chapter 1: Employing Unit webpage.

If you have questions or concerns about this issue, please contact your regional tax representative.

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January 2020

Have You Sold Your Business?

The Texas Unemployment Compensation Act requires that the Texas Workforce Commission investigate and potentially establish new tax accounts for employers who purchase an active business with employees. Please notify the Commission when you sell your business. This is easily accomplished using the Unemployment Tax Services System when you close your Tax account. Please visit our Changes to the Status of Your Business webpage for more information. 

 

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December 2019

Texas Workforce Commission
Unemployment Insurance Tax Rates for 2020

Dear Employer:

Texas continues to see business growth and a strong economic environment, as well as, a continued decline in unemployment claim activity. As a result, the unemployment trust fund balance will be above the statutory floor and Tax rates in 2020 will not include a deficit tax.

The components of your 2020 tax rate are:

  • The general tax – based on claims against your account. If TWC has paid benefits to former employees who were laid off or separated through no fault of their own in the past three years, you will pay the general tax.
  • The replenishment tax – charged to all experience rated employers to cover unemployment claims not charged to a specific employer. This tax tends to rise following economic downturns when claims increase and businesses close.
  • The employment and training investment assessment – a flat tax of 0.1 percent, paid by all employers. By law, the Replenishment Tax Rate is reduced by the same amount so there is no increase in your tax rate due to this assessment.

You may be able to reduce your taxes for 2020. If TWC paid benefits to your employees who were laid off or separated through no fault of their own, you may find it beneficial to “buy down” the tax rate. Please visit the TWC web site and click on the Businesses and Employers menu link for more information or access the voluntary contribution analysis through Unemployment Tax Services.

At TWC, we work hard to minimize your unemployment insurance costs. In addition to lowering the tax burden, TWC is taking an aggressive approach to eliminate fraud, waste, and abuse of all kinds in the programs the agency administers. By reporting new hires immediately to the state Attorney General’s office, responding promptly to notices when a former employee applies for unemployment benefits and responding to earnings information requests on claimants, you can help us avoid overpayments and fraud which costs all employers.

TWC works closely with local workforce development boards across Texas to fill job openings with qualified unemployed workers, and we fund training to upgrade the skills of workers to better match area employers’ needs. TWC also works closely with economic development organizations to support existing Texas companies and to bring new business to the state. We pledge our continued efforts in helping to keep taxes as low as possible in order to promote a thriving Texas economy.

Texas Workforce Commission
Austin, Texas 78778

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November 2019

Employer Posters

Texas Workforce Commission required and optional posters are available on our Posters for the Workplace webpage. 

Employers are able to print and post copies of the online posters. Government-issued posters DO NOT have to be laminated to satisfy an employer’s regulatory obligation.

Employers do not need to purchase these posters from private vendors; they are always free of charge. Employers should disregard a vendor who implies that they are out of compliance with state law and who urges them to purchase posters.

Please consult with TWC directly to determine which posters are required.

 

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October 2019

Written Authorization

Employers subject to the Texas Unemployment Compensation Act may appoint an agent to represent them in all matters before the Commission. This appointment required the employer to file a Written Authorization (Form C-42) which explicitly authorizes the agent to act on the employer's behalf.

An authorized agent has access to all information in the Commission's records regarding that employer. The authorized agent may submit all required reports and contributions under their own signature. Furthermore, the agent may participate in any claimant or tax administrative hearings conducted by TWC regarding the employer's account.

The employer or agent may revoke authorization at any time. Revocation requires the employer or agent to file a Revocation of Written Authorization Form C-43

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September 2019

Chargeback Information

Your tax rate is directly affected by the chargebacks to your account. Chargebacks are the sum of benefits paid to a claimant and charged to the tax account of the base period employer. These chargebacks will affect your rate for at least three years.

You can protect your tax rate by protesting your chargebacks on the former employees that were terminated for a good cause. You will  receive a "Notice of Maximum Potential Chargebacks" with protest instructions if your tax rate can be affected. Be sure and file your protest before the deadline on the notice.

The on-line Unemployment Tax Services (UTS) system gives you the option to view the chargebacks that affect each quarter.

Log on to your account; Click on the Report Filing Tab at the top; Select the Chargeback History link from the Quick Links box on the left. For each quarter in question, you can click on the View link in the Action column to view any chargebacks affecting that quarter.

If you have any questions regarding chargebacks please contact our Chargeback Unit at 512-340-4336 or visit our Benefit Chargebacks webpage for more information. 

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August 2019

Close UTS Account

If an employer files “no wage” reports every quarter for two consecutive years, we automatically close the account.  There is an expense to the taxpayers of Texas to maintain an active tax account, and if a company has not paid any wages in that period of time, we assume that the employer no longer has employment. Closing the account when you don’t have wages to report will relieve the employer of the obligation to continue to provide quarterly filings. Employers should close the account via Unemployment Tax Service (UTS) or by submitting a form C-13.

To close your account via UTS:

  • Log on to UTS
  • Click on 'Account Info' tab
  • Click on 'Update/Close Tax Account' in the Quick Links Box
  • Enter the requested information, and save.

If you do start having Texas employment again in the future, you can reopen a closed account for a period of three years from the last quarter you reported wages.

 

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July 2019

Taxable Wage Calculation

The Texas Workforce Commission taxes the first $9,000 paid to an employee in a calendar year for each full-time and part-time worker. A new calculation for all workers starts at the beginning of each year. 

Unemployment Tax Services (UTS) is designed to calculate the taxable wages for each employee for the quarter being reported, based on their Social Security number. Employers are encouraged to file their report using UTS to ensure proper taxable wage calculation. 

Please visit our Reporting & Determining Taxable Wages webpage for additional information on taxable wages calculation.

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