The 2018 list of credit reductions states is posted at https://oui.doleta.gov/unemploy/futa_credit.asp.
Note-“California repaid its outstanding advances, and did not have an outstanding balance on November 10, 2018, hence there will be no FUTA credit reduction”. The only state/territory left in credit reduction status is the Virgin Islands.
In anticipation of this, Datatech removed the Credit Reduction rate in the 2018 California State Tax Rate File at the start of the year. However, we had some customers choose to re-enter the rate just in case the additional tax would be in effect.
To check whether you have a credit reduction rate entered go to Payroll > Setup > State Tax Rate Tables. Select CA / 2018 if not already selected and click on the Other Withholding Settings tab. In the State Unemployment Insurance section, look for FUI Credit Reduction. If a rate is entered, zero the rate and click Save.
If you paid the extra credit reduction tax throughout the year, you may want to audit your tax liability and payments made before the end of the year. Use the Taxable Wages by Quarter report for FUI (Accessed from the Payroll > Quarterly Tax Reporting menu) to view your tax liability. You may be able to reduce your 4th quarter payment(s) for the amounts over-paid.