Since January 1, 2012, California employers have paid higher taxes because the state has not repaid money it borrowed from the federal government to pay unemployment insurance (UI) benefits. Unless Congress takes action (which is not expected), the higher tax will remain in effect through 2012 and then increase each year the state has an outstanding loan balance.

California’s UI Trust Fund has been insolvent since 2009.By the end of 2012, the UI Fund deficit is projected to reach $10.7 billion, according to the California Employment Development Department (EDD).

Employers will lose 0.3 percent of their federal tax credit, partially offset by the end of a 0.2 percent surcharge in July 2011.The 0.3 percent tax credit translates into approximately $21 per year for any employee who makes $7,000 or more in 2012. California employers pay UI taxes on the first $7,000 of wages per employee.

Statewide, the tax increase totals an estimated $289.8 million in 2012 and $615.7 million in 2013, according to the EDD October 2011 Unemployment Insurance Fund Forecast. This represents a loss of 0.6 percent of the tax credit in 2012, EDD reports.

The additional taxes paid will help offset California’s federal loan balance.

A group of California business organizations launched a new website to help California businesses understand their obligations under the dense and complex Patient Protection and Affordable Care Act.

Health Law Guide for Business is designed to provide accurate and easy to understand information on federal health care reform. The website’s motto is “2,409 pages. One simple web site.”