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NY
UC TRUST FUND IMPROVES BY
1/3 BILLION DOLLARS IN 2005
MAJOR STATE
UC TAX AVOIDED
New York's Unemployment Compensation Trust Fund balance improved dramatically
in 2005. The UC Trust Fund -- which stood at some $692 million negative on December
31, 2004 - is expected to finish 2005 with a balance of $342 million negative,
plus or minus $20 million.
The huge 2005 improvement exceeding one-third of
a billion dollars is great news for New York's private-sector employers (who pay all UC taxes - both State and
Federal - that fund the Trust Fund) as it means that a major increase in State
UC taxes of some $600 million dollars was not necessary; instead, the improved
fund balance enables NY's private-sector employers to avail themselves of the
smaller, and later due, payment of the increased January Federal FUTA tax* along
the road to the goal of a positive Trust Fund balance on December 31, 2006.
*The increased Federal FUTA tax due January 31, 2006 is projected to cost some
$280 million -- less than half of the avoided $600 million State UC tax which
would have been (chiefly) due April 30, 2005.
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