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Wednesday, January 5, 2011

Upcoming Unemployment Insurance Benefit Expirations

Katelin P. Isaacs
Analyst in Income Security

Two key provisions related to extended federal unemployment benefits are temporary and, therefore, scheduled to expire.

The temporary 100% federal financing of the Extended Benefit (EB) program ends January 4, 2012.

Authorization for the temporary Emergency Unemployment Compensation (EUC08) program is scheduled to expire the week on or before January 3, 2012 (i.e., December 31, 2011, in all states except New York state, in which the program ends January 1, 2012).

Additionally, there are several upcoming expirations that affect unemployment compensation more generally. The 0.2% federal unemployment tax (FUTA) expires on June 30, 2010. After that date the net FUTA tax on employers will drop from 0.8% on the first $7,000 of each employee’s earnings to 0.6%. In addition, states have until August 22, 2011, to submit an application for their share of the $7 billion from the Unemployment Insurance Modernization Act within the stimulus package, P.L. 111-5. Any funds from the $7 billion that remain unspent become unrestricted funds within the unemployment trust fund (UTF) on October 1, 2011.

This report describes the consequences of these expirations for the financing and availability of unemployment benefits in states.

Date of Report: December 21, 2010
Number of Pages: 6
Order Number: R41508
Price: $19.95

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