New Employer Tax Rate Table
| Year | Standard Beginning Tax Rate | Taxable Wage Base |
|---|---|---|
| 2020 | 1.000% (.01000) | $25,200 |
| 2021 | 1.000% (.01000) | $26,000 |
| 2022 | 1.000% (.01000) | $28,000 |
| 2023 | 1.000% (.01000) | $29,600 |
| 2024 | 1.000% (.01000) | $31,400 |
| 2025 | 1.000% (.01000) | $32,600 |
Tax rates are given to employers that are subject to unemployment tax. Tax rates are determined using the same experience rating formula. The base rate for a given year is determined by the stability of the Unemployment Insurance Trust Fund (UI Trust Fund). The chart below provides important employer tax rate information for this fiscal year.
Important Information for Annual Experience Rating for 2025 Tax Rates
| Item | Amount, percentage, date | N.C.G.S. Statute |
|---|---|---|
| Taxable Wage Base for 2025 | $32,600 | Section 96-9.3 |
| Base Rate | 1.9% | Section 96-9.2(c) |
| Employer's Reserve Ratio Percentage (ERRP) | Employer's Reserve Ratio Multiplied by 0.68 | Section 96-9.2(c) |
| UI Tax Rate for Beginning Employers | 1% | Section 96-9.2(b) |
| Minimum UI Tax Rate | 0.06% | Section 96-9.2(c) |
| Maximum UI Tax Rate | 5.76% | Section 96-9.2(c) |
| NCSUITS Documents for Unemployment Tax Rate Assignments For 2025 | December 16, 2024 | |
| Final Date for Voluntary Contribution | January 15, 2025 | Section 96-9.2(e) |
| Final Date for Protest | April 30, 2025 | Section 96-9.2(d) |
Experience Rating System
N.C. unemployment insurance tax rates are determined by an experience rating system that works like an insurance program. An employer begins at an introductory rate. The experience rating is to make sure there is fair handling of costs of the system among employers who cause unemployment, to encourage them to stabilize their workforce.
Employers get credit for timely payments posted to their NCSUITS account. The tax rate may be lowered.
For it to be lowered, the employer account is subject to being charged with benefits for at least 12 calendar months ending July 31 each year.
The rate may also be lowered by having the employer’s liability extend over a period of all or part of two consecutive calendar years.
After the initial new employer tax rate, the rate may go up after the first two years. The tax rate is calculated yearly based on experience. Factors such as payroll, taxes paid, timeliness of payments, and unemployment insurance benefits charges can impact that rating. Based on economic conditions, your rate could be as low as 0.060% or as high as 5.760%.
Your payroll for the last three fiscal years (as of July 31 of the current year) will be divided into your credit or debit balance to yield a ratio. This ratio is then multiplied by 0.68 to yield the Employer's Reserve Ratio Percentage, or ERRP. Refer to the rate formulas below to calculate your unemployment tax rate.
| North Carolina UI Trust Fund Balance as Percentage of Total Insured Wages* | Contribution Rate |
|---|---|
| Less than or equal to 1% | 2.9% minus ERRP |
| Greater than 1% but less than or equal to 1.25% | 2.4% minus ERRP |
| Greater than 1.25% | 1.9% minus ERRP |
*Defined in Section 96-9.2(c) as the totals for all insured employers. The calculated Contribution Rate for any given tax year applies equally to all experience rated employers.
Additional Tax Rate Information
Your Unemployment Tax Rate Notice (Form NCUI 104) for the upcoming tax year will be in your NCSUITS Inbox each November or December. The tax rate is final, unless protested in writing before May 1 of the following year. No payment is required when the NCUI-104 is received in your inbox, and it can’t be used to pay any taxes that are due.
There are two ways to view your tax rate. Log in to your NCSUITS account.
On your account main page, you will find your current tax rate under Employer Information.
- Click on Tax Rate to view previous year’s rate.
- Under Your Options select Tax Rate and choose the year you want to view and click Search.
Log in to your NCSUITS account, from the Your Options menu:
- Click Documents and Emails.
- Go to My Correspondences and click Search to find your Annual Rate Notice.
Tax rates are assigned using the same experience rating formula. The base rate for a given year is determined by the UI Trust Fund.
You may protest a tax assessment and payment demand letter using the NCSUITS inquiry feature or in writing. Protests must be made prior to May 1. A protest must be signed by an owner, partner, or corporate officer—not a third party. An example of a valid protest is if an error was found in the figures used to calculate the tax rate.
They may be faxed to (919) 715-0780 or mailed to:
N.C. Division of Employment Security
P.O. Box 26504
Raleigh, NC 27611-6504
- Your tax rate may be lowered below the standard rate for any calendar year. For your rate to be lowered, your account is subject to being charged with benefits for at least 12 calendar months ending July 31 of each year.
- The rate may also be lowered by having your liability extend over a period of all or part of two consecutive years.
- Voluntary contributions may also lower your tax rate.
Voluntary contributions may be made online through your NCSUITS account or by check. Checks must be noted as voluntary contributions to NCDES and mailed to:
N.C. Division of Employment Security
P.O. Box 26504
Raleigh, NC 27611-6504
NOTE: If a voluntary contribution is made by January 15, 2025, after receiving your 2025 annual tax rate notice or within 30 days of the date of your revised tax rate notice, your NCSUITS account will be credited, and your tax rate will be adjusted for 2025.
No. DES will provide you with your new tax rate by mail. You will not receive another summary of your account. The summary you receive the following year will reflect the contributions. You can also view your tax rate in your NCSUITs account.
Yes. Your tax rate can change because of factors such as your payroll, tax paid, timeliness of payments, and tax rate in effect for that year.
A 20% surtax is imposed on contributions in a calendar year when the amount in the UI Trust Fund does not equal or exceed $1 billion in accordance with N.C. Gen. Stat. § 96-9.7(b). Your assigned rate will be the combined or composite rate.
The surtax is not Federal Unemployment Tax Act (FUTA) certified. When the surtax is imposed, DES will only certify 83.33% of the total taxes paid. If the surtax is not imposed, DES will certify 100% of the total taxes paid.
The surtax applies to all employers who are making payroll unemployment contributions.
Contact the Employer Call Center at 866-278-3822.