California unemployment fund is broke — and getting “broker” every day

Richard Rider, Chairman, San Diego Tax Fighters Undesignated Leave a Comment

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California is broke. We all know that. But one component that deserves at least passing notice is the state unemployment fund.

Surprise! It’s broke. So broke that it’s borrowed federal funds to keep paying people not to work. Now CA has to charge CA employers a payroll surcharge to pay the money back.

It’s not a huge tax per employee, but it’s unlikely to go away for years. Moreover the size of the “fed loan” employer tax will surely grow annually.

It’s just one more reason for businesses to relocate elsewhere. The only good news on this front is that there are 22 states with similar problems (Texas ain’t one of ’em).

http://taxfoundation.org/article/trend-7-collapsing-unemployment-insurance-systems

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