Florida Unemployment Tax Insanity is the Department of Revenue (DOR) consistently losing tax returns and other mail, sending erroneous tax notices, filing improper liens, overcharging employers and not doing its duty under Florida and federal law. Employers will soon pay much more for this abuse.
I blogged, Twitted and sent letters to Governor Crist and his DOR about this Florida Unemployment Tax Insanity, but have yet to get a reply. This may be because Governor Christ is too busy campaigning or the insanity was worse than I thought.
Outrageous Tax Increases During Bad Times
The low Florida unemployment tax is now $8.40 (0.12% on $7,000 of wages/employee/ year). It will soon rise to $100.30 (1.18% on $8,500 of wages, Florida unemployment tax on businesses to skyrocket). The maximum unemployment tax will increase from $378 (5.4% of $7,000) to $459 (5.4% of $8,500). That means that a rotten employer, with many unemployment claims, will pay 21% more. However, good employers, who keep employees and minimize claims, will soon have an 1194% increase in unemployment tax. This will cause more layoffs, where we already have 11.2% unemployment and 46% of southeast Florida homes are worth less than mortgages (compared to 10.2% and 21% nationally). The DOR compounds this by penalizing those who pay sales tax by check, saying checks came without returns! Does this make sense?Gross Mismanagement
I have been a CPA in three states, in small and large CPA firms, for many years. The DOR is consistently the worst government agency I ever saw by far. It takes about two months to process paper tax returns, but it loses many entirely, partly because it ignores return address changes. It recently lost seven sets of my returns, as proven by certified mail receipts. It even lost a receipted local office delivery and faxes to a senior DOR manager (after he confirmed receipt on the phone). The DOR adds late filing penalties, liens and more penalties or not responding promptly. How do you respond if you know DOR lost your original return and loses most responses? DOR even adds E-file penalties on employers with less than 10 employees, who need not file electronically under Florida law.
Florida Unemployment Tax Insanity
The worst DOR outrage is deliberate disregard of low rates earned by low unemployment claims. DOR knows its history of erroneous and delayed processing. However, if it does not see prompt filing and responses to often erroneous notices, it charges the highest possible rate. That can increase your $8.40/year/employee tax to $378 or $459, or 45 to 55 times as much. Basically, DOR profis from its own malfeasance, which should be against the law. In fact, I believe it violate Article 14 of the U.S. Constititution (due process and equal protection), as well as federal unemployment benefit revenue sharing rules.
Explosive Issue
When I first looked at this Google had around 7,000 links to Florida Unemployment Tax Insanity. Google now has 153,000 links, while Yahoo has 491,000. Click on these underlined links to see the latest numbers on this 2010 campaign issue. Then contact your state legislators and their opponents.
The Solution
The new health care bill adds 17 new taxes, with much new paperwork. As a CPA with a long history of successful tax cut efforts, I can help you avoid many of them, Florida Unemployment Tax Insanity, Wage and Hour Laws, the Family Leave Act and many other federal and state laws. Some of these apply to small companies. You can start doing this by using letting me help you convert employees to independent contractors, corporate contractors and outsourcing, in ways that Internal Revenue, Florida and other states accept. I will detail this tomorrow.
