Accounting Articles > Illinois Unemployment:
What is it and how does it affect my business?
Every company that has employees on the payroll has to pay into Illinois’ unemployment fund. In Illinois, it is called The Department of Employment Security.
This fund was created to cover the costs of all persons receiving unemployment compensation. The money does not come from the government, but from all Illinois businesses with employees.
Each new business is assigned a temporary initial percentage rate for their compensation. In 2007, this rate is usually 3.1%. Every quarter of each year, a report called The Employee Wage and Compensation Report is submitted. This document lists all current employees and the wages they earned for that particular quarter. All wages (up to a maximum of $10,500 per employee in 2007) are taxed at the company's IDES percentage taxation rate. This amount is then forwarded to the Department. Once an employee has earned over $10,500, the Company will no longer be taxed on that worker.
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