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Conditions of Liability

In general, any employer who (a) in any calendar quarter in either the current or preceding calendar year paid wages for services in employment of $1,500  or more or (b) had  in employment at least one individual for some portion of a day in each of twenty different weeks, not necessarily consecutive, in either  the current or preceding calendar year becomes liable on the first day of the year or the first day of business, whichever is earlier. Other conditions of liability follow. 

Federal Tax Liability  

Employers who are liable under the Federal Unemployment Tax Act (FUTA) become liable under the Connecticut Unemployment Compensation Law from the beginning of the calendar year or the beginning of operations in Connecticut if at least one person is employed in this state.

An employer becomes federally liable if, during either the current or preceding calendar year, he (a) paid wages of $1,500 or more in any calendar quarter or (b) had one or more employees at any time in each of twenty calendar weeks.

Government sub‑divisions and certain qualified non‑profit organizations are not subject to the Federal Unemployment Tax Act. 

Successor  

An employer becomes liable immediately by acquiring substantially all of the assets, organization, trade or business of another employer who was liable at the time of acquisition. If the predecessor employer was not liable at the time of acquisition, the number of weeks he employed one or more persons in the calendar year of acquisition is counted along with the number of weeks the successor employer employed one or more persons in the calendar year to arrive at the twenty weeks of employment to determine liability.

Executors, administrators, successors or assignees of any former employer acquire the experience of the predecessor employer with the following exception: The experience of a predecessor employer who leased the premises and equipment from a third party and who has not transferred any assets to the successor, shall not be transferred if there is no common controlling interest in the predecessor and successor entities. 

Agricultural 

Effective January 1, 1978, an employer who has service performed by an individual in agricultural labor is liable if the service is performed for a person who (a) during any calendar quarter in either the current or preceding calendar year paid remuneration in cash of  $20,000 or more to individuals employed in agricultural labor, or (b) employed for some portion of a day in each of twenty different calendar weeks,  not  necessarily  consecutive, ten or more individuals regardless of whether they were employed at the same moment in time.

Agricultural coverage under FUTA is also created by the conditions described above in (a) and (b).  Liability to FUTA creates liability to the Connecticut Law from the beginning of operations in Connecticut if at least one person is employed in this state.

Aliens admitted to the United States to perform agricultural services are considered employees.

Domestic Employment 

Any person who employs an individual for domestic service in a private home, college club or chapter of a college fraternity or sorority and who paid cash remuneration of $1,000 or more, for any calendar quarter in the current or the preceding calendar year, to individuals employed in such service, is subject to the provisions of this law.

Only cash wages are taxable under Connecticut domestic service coverage.  The cash value of other than cash payments is not taxable. This includes meals, lodging, rent, clothing or merchandise.

Non-Profit Organizations 

Most  non‑profit organizations, even if exempt from income taxes under the Internal Revenue Code, are subject to the Connecticut Unemployment Compensation Law. If an organization is exempt from Federal income tax as provided under Section 501 (c)(3) of the Internal Revenue Code, and has one or more employees for some portion of a day in each of thirteen different calendar weeks, whether or not consecutive, within either the current or preceding calendar year, liability commences at the end of the thirteenth week.

Section  501(c)(3) includes any corporation and any Community Chest fund or foundation organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary or educational purposes, or for the prevention of cruelty to children or animals, no part of net earnings of which inures to the benefit of any private stockholder or individual, no substantial part of the activities of which is carrying out propaganda or otherwise attempting to influence legislation and which does not attempt to participate or intervene in (including the publishing or distributing of statements) any political campaign.

Such organizations are given the option of paying unemployment taxes on the wages of covered employees, or reimbursing the Unemployment Compensation Fund for the amount of benefits paid to former employees.

All other non‑profit organizations are considered to  be regular employers.

Municipalities, State Government Agencies , and Federally Recognized Indian Tribes or Tribal Units 

These employers are subject to and shall pay contributions under the same terms and conditions as all other subject employers, unless they elect to pay into the Unemployment Compensation Fund amounts equal to the amounts of benefits attributable to service in the employ of the municipality, State Government agency or Indian tribe.

Such organizations are given the option of paying unemployment taxes on the wages of covered employees, or reimbursing the Unemployment Compensation Fund for the amount of benefits paid to former employees.

Voluntary Acceptance

An employer not liable under the law may volunteer to accept coverage for all his employees with one exception.  The law prohibits the voluntary coverage of service performed by an individual in the employ of his son, daughter or spouse and service performed by children under eighteen years of age in the employ of either or both parents. A voluntary acceptance form must  be submitted in writing and must include all employees who are eligible for coverage.

Voluntary acceptance of  liability  may be revoked by the employer at the end of any calendar year following the calendar year of acceptance.

Discontinuance of Business

Employers who discontinue business are required to notify the Administrator via the Internet at https://sso.ctdol.state.ct.us/English/CommonLogin/CommonLogin.aspx or in writing, giving employer number, date of discontinuance, trade name and address of successor, if any.  Please include a telephone number.


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