State unemployment insurance (SUI) tax
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Use the dropdowns below to find information about state unemployment insurance (SUI) taxes. Use CMD + F (or CTRL + F) to search for words in the article.
Important reminders
- Unemployment exemptions
- If your company or an employee does not have to pay state unemployment tax (SUTA), set up the exemption in Gusto.
- State registration and third-party authorization (TPA)
- If you still need to register or give Gusto access to pay and file, go to the state registration article in this Help Center section. You can also learn where to find your assigned unemployment rates if you've already registered.
State agencies assign your company an unemployment insurance tax rate when you register as an employer. Each year, you will get a new notice with your updated rate. These notices usually arrive between November of the prior year and March of the current year.
⚠️ Important compliance reminder: You must keep your SUI rate up to date in Gusto. If you miss deadlines, the state agency may charge penalties or interest, and your company will need to pay them.
Add a new SUI rate
Tip: Wait until October 1 or later to add rates for the following year.
Follow these steps to enter a new SUI rate from your state notice:
- Sign in to Gusto.
- Go to Taxes & Compliance > Tax setup.
- Click Manage Taxes under the applicable state section.
- In State Tax Settings, click Edit next to Unemployment Tax Rate (may also be called “SUI rate” or “Experience rate”).
- Updating only works in states where you have active employees.
- You can also view your past rates here.
- Click Add a new rate.
- If the rate was effective during a prior closed quarter, you may get a tax notice for an amount owed or a refund (depending on whether you underpaid or overpaid).
- Enter the percentage from your notice.
- Example: If your notice says .055555, enter 5.5555%.
- For state-specific entry instructions, check the state registration articles.
- Set the Effective Date from the notice.1
- Most states: January 1.
- New Jersey, Tennessee, Vermont: Use July 1.
- New Hampshire: Dates may be Jan 1, Apr 1, Jul 1, or Oct 1, depending on the notice.
- Click Save.
Correct a SUI rate or effective date
If you entered the wrong rate or effective date, update it as soon as you have the correct info.
- Sign in to Gusto.
- Go to Taxes & Compliance > Tax setup.
- Click Manage Taxes under the applicable state section.
- In State Tax Settings, click Edit next to Unemployment Tax Rate (may also be called “SUI rate” or “Experience rate”).
- Updating only works in states where you have active employees.
- You can also view your past rates here.
- Click Make a correction.
- Before each quarter ends, Gusto runs a reconciliation payroll to check for differences between your current SUI rate and past rates.
- If we find you underpaid, Gusto will debit your account for the missing amount.
- If we find you overpaid, Gusto will refund the extra amount.
- If the new rate applies to a quarter that has already closed, you will likely get a notice from the agency:
- Underpaid → You must pay the agency.
- Overpaid → You will receive a refund.
- ⚠️ Gusto does not amend unemployment returns for past quarters. You either pay the agency directly or accept the refund.
- Before each quarter ends, Gusto runs a reconciliation payroll to check for differences between your current SUI rate and past rates.
- Enter the correct rate (example: .055555 → 5.5555%) and effective date from your notice.
- For state-specific entry instructions, check the state registration articles.
- Set the Effective Date from the notice.1
- Most states: January 1.
- New Jersey, Tennessee, Vermont: Use July 1.
- New Hampshire: Dates may be Jan 1, Apr 1, Jul 1, or Oct 1, depending on the notice.
- Click Save.
1 Failure to timely update or confirm your State Unemployment Insurance rate may result in additional taxes and penalties being imposed on the taxpayer by the taxing authority or agency.
What happens if you update late
If the update applies to a closed quarter, the agency may issue:
- A notice to pay more (if underpaid), or
- A refund (if overpaid).
Gusto will not amend unemployment returns for past quarters.
- If underpaid → Pay the agency directly.
- If overpaid → Accept the refund.
Before the end of each quarter, Gusto runs a reconciliation payroll. If a difference is found:
- Gusto will debit your account for underpaid taxes, or
- Gusto will refund your account for overpayments.
⚠️ Final compliance reminder: Failure to update or confirm your SUI rate may result in extra taxes and penalties from the agency. The company is responsible for paying these.
Automatic updates from agencies
Some agencies share rate updates directly with Gusto. If we can confirm your rate, we may update it for you. However, it is still your responsibility to:
- Confirm your correct rate is entered in Gusto, and
- Update it if necessary.
Get help
If you need assistance entering or correcting your rate, message us from the 
in your account.
Some employers can be SUI reimbursable if they are:
- A non-profit
- A religious group
- A government employer
- Gusto does not support government employers marking as FUTA exempt, but you can set FUTA exemptions for all employees.
SUI reimbursable employers pay the state back for unemployment benefits paid to their former employees instead of paying quarterly like other companies. These employers have an account with the state and are charged for the exact amount of benefits paid (monthly, or quarterly).
If you’re not sure if you’re SUI reimbursable, contact the state agency.
Federal tax setup requirements
To be “SUI reimbursable” the following must be true in the Federal Tax Setup section of your account:
- Company Type: Non-Profit
- Special FUTA exemption: You’ve chosen Yes, we are a non-profit 501(c)(3) organization and are exempt from FUTA.
- This means you’re exempt from paying FUTA, but are still required to file.
- Do not set up a separate company exemption for FUTA, it will block the required filings.
Add or edit SUI reimbursable status for states
If you’re not sure if you’re SUI reimbursable, have effective date questions, or need to find your unemployment rates, contact the state agency. South Carolina employers who are SUI reimbursable should read below for additional requirements.
- Make sure you've met the Federal Tax Setup requirements above.
- Go to the Taxes & Compliance section and click Tax setup.
- Scroll to the applicable “[State] Tax Setup” headline.
- Click Manage Taxes.
- Scroll to the “State tax settings”, and click Edit next to “SUI reimburser”.
- Choose from the options:
- Add a new setting if you recently became SUI reimbursable.
- Make a correction if you’ve been reimbursable but did not enter that information in Gusto.
- Confirm effective dates, and make any other selections necessary.
- Click Save.
South Carolina employers who are SUI reimbursable
After you've let us know you're SUI reimbursable, if you still see a SUI and “DACA” rate listed in Gusto, we'll need your help fixing this:
- Contact us from the
section of Gusto. - Let us know you’re SUI reimbursable in SC, and the DACA rate should not apply.
- We’ll set up a company exemption for the DACA tax. This means we won’t withhold the tax or pay it to the agency.
- Heads up: A DACA rate may still show in Gusto, but we're not withholding the tax or paying it.
Solution Properties
- Keywords
- payroll unemployment tax state sui unemployment notice unemployment liability update multi-state new employer rates new employer rates unemployment ranges sui invalid rate remployment wage base limits sui sui localization multi state nonresident
- Solution ID
- 106622236100000
- Last Modified Date
- 10/02/2025 12:12:31 PM
- Attributes
-
Gusto Attributes
- Role: Employers; Accountants/Partners
- Category: Company setup and details; Payroll; Taxes forms and compliance
- Plan type: Core; Complete; Concierge
- Who brokers my benefits?: A third party; Gusto
- Taxonomy
- Collections
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- Admins
- External
- Support Agent
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- 0