Florida Unemployment Compensation Tax
Who Must Report Wages and Pay UC Taxes?


General Liability Requirements

A business is liable for unemployment compensation tax if, in the current or preceding calendar year, the employer: (1) has paid at least $1,500 in wages in a calendar quarter; or (2) has had at least one employee for any portion of a day in 20 different calendar weeks in a year; or (3) is liable for the Federal Unemployment Tax as a result of employment in another state.

Special Liability Requirements for Certain Employer Types

Nonprofit Employers

Coverage is extended to employees of nonprofit organizations (such as religious, charitable, scientific, literary, or education groups) that employ 4 or more workers for any portion of a day in 20 different calendar weeks during the current or preceding calendar year. Exceptions to this coverage are churches and church schools. For purposes of the Florida Unemployment Compensation Law, a nonprofit organization is one as defined in Section 3306(c)(8) of the Federal Unemployment Tax Act and Section 501(c)(3) of the Internal Revenue Code.

Governmental Entities

Coverage is also extended to employees of the State of Florida and any city, county or joint governmental unit.

Nonprofit organizations and governmental entities have the option to be taxpaying employers or reimbursing employers. A reimbursing employer is one who must pay the Unemployment Compensation Trust Fund on a dollar-for-dollar basis for the benefits paid to its former employees. Wage reports are submitted each quarter and benefit charges are paid when billed by the division. The employer electing the taxpaying method must submit quarterly reports with payments on a quarterly basis. To elect a reporting method, the employing unit must complete and sign a special form electing a payment method for a minimum two-year period. If the employing unit wishes to change its method of payment, it must make written application no later than December 1st of the second year of reporting, requesting to change methods on January 1st of the subsequent year.

Agricultural Employers

Agricultural employers who, in the current or preceding year, have paid $10,000 in cash wages in a calendar quarter or who have five or more workers for any portion of a day in 20 different calendar weeks are liable for unemployment compensation tax. Employers who establish liability under this provision must also report, under the same account number, any other employees (except domestic employees) although the employment was for less than 20 different weeks or the wages paid were less than $1,500 in any one quarter.

Domestic Employers

Employers of domestic employees (maids, cooks, maintenance workers, chauffeurs, social secretaries, caretakers, private yacht crews, butlers and houseparents) who, in the current or prior year, have paid $1,000 in cash wages in any one calendar quarter are liable for unemployment compensation tax. Employers liable under this provision will not report general employees or agricultural employees unless they also establish liability under these other provisions of the Law.

Likewise, employers liable for their general employment will not report domestic or agricultural workers unless they also establish liability in these categories. In making a determination of liability, the wages paid in agricultural employment and in domestic employment must be counted separately from wages paid in other types of employment.

Following is a chart that illustrates coverage requirements for four different employers (A, B, C, and D). Columns two, three and four list employment for each sample employer and the column on the far right lists the coverage (liability) required.


Employer Examples


$10,000 payroll in any quarter
5 employees for 20 weeks within a calendar year


$1,000 payroll in any quarter


$1,500 payroll in any quarter
1 employee for 20 weeks within a calendar year

Subject to UC Taxes

Employer A

$5,000 payroll & 5 employees for 10 weeks

$1,500 payroll

$1,000 payroll & 1 employee for 4 weeks

Domestic coverage only

Employer B

$10,000 payroll & 5 employees for 20 weeks

$2,000 payroll

$1,500 payroll & 1 employee for 15 weeks

Coverage for all three types of service

Employer C

$25,000 payroll & 18 employees for 20 weeks

$500 payroll

$1,000 payroll & 1 employee for 15 weeks

Agriculture and General coverage only

Employer D

$5,000 payroll & 2 employees for 10 weeks

$200 payroll

$10,000 payroll & 4 employees for 10 weeks

General coverage only

Voluntary Coverage

Employers who are not otherwise liable under the law may apply for coverage for their employees. Employers liable for one type of employment (general, for example) may elect to cover their employees in other types of employment (agricultural and/or domestic). Election of voluntary coverage obligates an employing unit to be a taxpayer for a minimum of one calendar year. Forms for election of coverage may be obtained from the Employer Information Center.

Employer-Employee Relationship

Employment means any service performed by an employee for the person employing that individual.

An employee is an individual as defined under the common law rules for employer-employee relationships. An employee is a person who is subject to the will and control of the employer not only as to what shall be done, but how it shall be done.

Any officer of a corporation performing services for the corporation is an employee of the corporation during all of the tenure of office, regardless of whether compensation for such services is received. Compensation, other than dividends upon shares of stock and board of director fees, shall be presumed to be payment for services performed.

Sales personnel are considered covered employees. The fact that a salesperson working for an employer is paid solely by commission does not remove the person from the employer's direction and control. The law provides specific exemption only for real estate agents, insurance agents, and barbers who are paid solely by commission. If they are paid by salary only or by salary and commission, both are taxable and the exemption does not apply.

An employer is the person, partnership, or corporation for whom service is performed. Common law recognizes a master-servant relationship in the exercise of will and control by the employer over the employees. The employer can direct what services will be performed, when and where they will be performed, and can set standards for the quality of work to be rendered.

In agricultural labor, either the farm operator or the crew leader may be considered the employer. An individual must hold a valid certification of registration under the Farm Labor Contractor Registration Act of 1993 to be a crew leader. The crew leader is the employer if he/she (1) provides the crew, (2) supervises the work being performed by the crew, (3) has the right to terminate employment, and (4) is responsible for the payment of wages to the workers.

The farm operator is the employer if (1) the individual is an employee of the farm operator under common law rules of master and servant or (2) the worker is furnished by the crew leader, but is not treated as an employee of the crew leader, i.e. the crew leader is acting on behalf of the farm operator, rather than as an employer, or (3) the crew leader has entered into a written agreement with the farm operator under which the crew leader is designated as an employee of the farm operator.

An independent contractor is one who is not subject to the will and control of the employer. The employer does not have the right to control or direct the manner or method of performance, although the results to be accomplished are controlled. Independent contractors hold themselves out to the public as such. Generally, they furnish materials as well as labor and use their own tools in the performance of the work. Services performed by independent contractors cannot be summarily terminated without recourse. A contract for labor only will normally be considered a contract of employment. How the worker is treated, not a written contract, determines employment status.

Employment Not Covered

Several types of employment are not covered for unemployment compensation purposes and the workers performing these types of employment are not considered in determining an employer's liability. Some of these exemptions include:

Inactivation of Account

An employer’s account is made inactive when the employer ceases to have payroll and notifies this division of the date this occurred. If an account is inactive and employment resumes, this division must be notified, wages paid must be reported and taxes must be paid. An Employer Registration Report (UCS-1) must be completed in order to reopen the account.

Termination of Liability

Termination of liability is not the same as inactivating an account. An employer’s account is eligible for termination if the liability requirements have not been met for an entire calendar year. In this instance, application for termination of liability must be submitted no later than April 30 of the following year in order to be considered timely. Once an account is officially terminated, liability must be reestablished as described in this handbook. Employers are responsible for submitting quarterly reports until they are officially notified that liability has been terminated.

Can I get information from you, rather than from the government?

Yes, just e-mail or phone. See the contact button for more information.

For information about Kulzick Associates, PA services for small businesses: SBS - Services

See also:
        Federal (U.S.) Payroll Taxes
        New Hire Reporting In Florida
        Setup payroll and payroll taxes
        Small Business Services

Copyright 1999 Raymond S. Kulzick. All rights reserved. 90105.

This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.


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Copyright 1998 Kulzick Associates, PA - Last modified: September 13, 2008