E6-20910. Notice of Approval for Missouri for Avoidance of 2006 Credit Reduction Under the Federal Unemployment Tax Act

Sections 3302(c)(2) and 3302(d)(3) of the Federal Unemployment Tax Act (FUTA) provide that employers in a state that has an outstanding balance of advances under Title XII of the Social Security Act on January 1 of two or more consecutive years are subject to a reduction in credits otherwise available against the FUTA tax for a calendar year, if a balance of advances remains on November 10 of that year. Because the account of Missouri in the Unemployment Trust Fund had a balance of advances on January 1 of 2004, 2005, and 2006, and still had a balance of advances on November 10, 2006, Missouri employers were potentially liable for a reduction in their FUTA offset credit for 2006.

Section 3302(g) of FUTA provides that a state may avoid credit reduction for a year by meeting certain criteria. Missouri applied for avoidance of the 2006 credit reduction under this section. Pursuant to delegation of authority to me under Secretary's Order 4-75, I have determined that Missouri meets all of the criteria of section 3302(g) and thus qualifies for credit reduction avoidance. Therefore, Missouri employers will have no reduction in FUTA offset credit for calendar year 2006.

Dated: November 24, 2006.

Emily Stover DeRocco,

Assistant Secretary for Employment and Training.