|
Term |
Definition |
|
Experience Transfer |
In the event that a business or part of a business is sold to a new owner/operator, UI tax information needs to be transferred to the new business. This existing UI tax data is thought of as the “experience” of the previous business (predecessor, acquired business). This experience is transferred to the new owner/operator (successor, acquiring business) as the new business becomes liable for the UI taxes of the employees of the business. Within the process this data transfer is called an experience transfer. |
|
Full Experience Transfer |
See Experience Transfer. An Experience Transfer is full when the entire (100%) of a business is sold (acquired business or predecessor) to a new owner/operator (acquiring business or successor). All experience is transferred to the new owner’s business and the former business is made inactive. |
|
Partial Experience Transfer |
See Experience Transfer. An Experience Transfer is partial when only part of a business is sold to a new owner/operator. |
|
Substantially All |
See Experience Transfer. An Experience Transfer is considered ‘Substantially All’ when the purchased business (predecessor) is between 95 and 99% acquired. While this type of transfer is still considered a partial acquisition, 100% of the experience is transferred to the new owner’s business (successor). The difference between this and a full experience transfer is that both the acquired and acquiring business remain active after the transfer is complete. |
|
SDDS |
SUTA Dumping Detection System SUTA Dumping Prevention Act refers to tax rate manipulation, as practiced by some employers and recommended by some financial advisors, in order to pay lower State UI taxes than their unemployment experience would otherwise allow. (“SUTA” refers to State unemployment tax act.)
The SUTA Dumping Prevention Act of 2004 amended the SSA to add Section 303(k), establishing a nationwide minimum standard for detecting and preventing SUTA Dumping. States are required to amend their UI laws to conform to this new requirement. (USDOL)
|
|
SUTA |
SUTA stands for State Unemployment Tax Act. SUTA is a form of payroll tax that all states require employers to pay for their employees. SUTA is a counterpart to FUTA, the federal unemployment insurance program. Like the federal unemployment insurance program, the state unemployment insurance sets a limit to the wages taxed. This is known as a taxable wage base. The taxable wage base varies from state to state. |