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UI Taxes

Protect Your Business From Higher Taxes
Unemployment Insurance (UI) is a safety net program that provides temporary income support for qualified unemployed workers. As an employer, you pay UI taxes to fund UI benefits. When these benefits are improperly paid, you end up paying even more. The improper payment of UI benefits is a serious problem that impacts employers.

Improper UI benefit payments result in higher taxes for employers

In 2010, American businesses faced an estimated $6.86 billion in additional costs because of errors in UI benefit payments. In fact, the U.S. Department of Labor estimates that more than 11 percent of UI benefits were improperly paid in fiscal year 2010.
Improper payments occur when inaccurate or insufficient information is used to determine a claimant’s eligibility for UI benefits or when information is not received by the New Mexico Department of Workforce Solutions in a timely manner.
Sometimes the claimant is at fault; sometimes it is the employer. Regardless, when improper payments are detected, claimants are notified and steps are taken to recoup the money that has been overpaid. 

What you can do to help
Employers can help reduce the number of improper payments – and potentially higher taxes – by providing all of the information necessary for the New Mexico Department of Workforce Solutions to make an accurate determination of a claimant’s eligibility.

Take an active role in helping to improve the accuracy of UI payments and reduce the costs to New Mexico businesses – including your own.

These three steps will help you provide accurate information to the UI program and prevent improper payment of UI benefits:

  1. Promptly report all new hires and rehires to the State Directory of New Hires – and no later than the due date. Timely reporting of this information helps prevent payments to individuals who are no longer eligible because they have returned to work.
  2. Respond quickly to any “Request for Verification of Weekly Earnings” from the New Mexico Department of Workforce Solutions.
  3. Provide complete and accurate employee separation information. This helps to determine a claimant’s eligibility for UI benefits, resulting in accurate charges to employers and fewer costly appeals.

Avoid the costs and consequences of non-compliance

Reporting employee information accurately is not just the law, it is good business. Employers that do not comply with state and federal UI requirements face a number of avoidable costs and consequences, including:

  • Improper account changes for benefits paid to ineligible claimants
  • Increases in employer UI taxes
  • Possible fines and penalties

Reduce your risks. Develop a partnership with the New Mexico Department of Workforce Solutions.

What you should know about UI

"What You Should Know About Unemployment Insurance (UI)" includes several topic areas for both individuals receiving benefits and employers paying Unemployment Insurance taxes in New Mexico. Spanish versions available for select videos. 

In addition to the information available on the above pages, each topic area will also include a short video. These videos may also be viewed on the New Mexico Department of Workforce Solutions YouTube channel. 

YouTube