Payroll Puzzler

June 20, 2016

Paying Unemployment Insurance for an employee working in multiple states can be confusing to navigate. Read on to learn the answer!

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Question: Osmond has work assignments in State A and State B, without one being the primary state where he works. He does not have a base of operations, but lives in State C. The employer that directs Osmond’s work is in State B. State A has a higher taxable wage base than State B and State C. To which state or states would the employer be required to pay unemployment tax on Osmond’s wages?

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Answer: The state to which unemployment tax would be paid is State B. When there is no clear primary work state and no clear primary state where an employee has a base of operations, the state from which the employee receives direction or control or could receive such direction or control is the state to which the tax would be paid. For more information, see Payroll Administration Guide’s “State UI Programs: General Rules and Procedures” chapter.

Reproduced with permission from HR & Payroll Resource Center, 27 PAG 93 (Jun. 15, 2016).

Copyright 2016 by The Bureau of National Affairs, Inc. (800-372-1033) <>

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