Louisiana statutory withholding rate on additional unemployment benefits not mandatory
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Wednesday, August 12, 2020

Louisiana statutory withholding rate on additional unemployment benefits not mandatory

By Payroll and Entitlements Editorial Staff

Under recently enacted Louisiana legislation, claimants who are eligible to receive a temporary federal emergency increase in unemployment compensation benefits, in addition to the maximum weekly benefit amounts or any additional federal base benefit, must submit to state income tax withholding at a rate of 4%. However, under federal law, withholding from unemployment insurance must be voluntary in order to conform with federal funding requirements. Therefore, the Louisiana Work force Commission has enacted an emergency regulation providing that whenever additional federal benefits are in effect, the statutory 4% withholding rate is not mandatory. Rather, a claimant may voluntarily elect to have state income taxes withheld at the 4% rate. (H.B. 62, Laws 2020, effective August 29, 2020; LAC 40:IV.383, Louisiana Workforce Commission, effective August 29, 2020).

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