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Updated calculation program and new travel reimbursement rates - Michigan
Consulting firm fined for advising employer to avoid unemployment taxes
Michigan
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Three Michigan companies have reached settlements with the State of Michigan, totaling more than $42,300 for their involvement with plans to avoid some of their state unemployment taxes.
One of the companies is an accounting and consulting firm and is the first employer advisor to pay a fine for a case involving SUTA Dumping. It is reported that the consultant reached a negotiated settlement with the Unemployment Insurance Agency (UIA), agreed to pay a $25,000 penalty, and agreed not to offer inappropriate unemployment tax advice to clients in the future.
The second employer is a trucking company and has reimbursed UIA for nearly $4,200 in unpaid UI taxes and interest charges. The employer had set up a "captive" leasing arrangement by forming its own employee-leasing company, to which it shifted its employees and then leased them back to itself, thereby avoiding some unemployment taxes.
The third employer is a furniture company and has agreed to repay the agency for about $13,100 in unpaid taxes plus interest. The employer closed its unemployment tax account and transferred its company payroll to a newly established employer at the "new" employer tax rate of 2.7 percent, which was lower than the company's former tax rate. UIA determined the restructuring was inappropriate and resulted in a $13,100 tax loss to the state's unemployment insurance trust fund.
SUTA (state unemployment tax act) Dumping plans usually involve moving employees from an employer's high unemployment tax rate account to a lower tax rate account. The prime intent is to pay less tax.
...back to 22 December 2005
Further information:
State Of Michigan Fines Consulting Firm For Advising Employer To Avoid Unemployment Taxes
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