By Tom Towson
Anytime an organization goes through an M&A event -- even internal restructuring where employer transfers workforce from one legal entity to another, the potential impact to state unemployment insurance (“SUI”) tax costs must be taken into consideration. SUI tax rates are the only rates controllable by the employer. When an M&A event is involved you have a unique opportunity to reduce costs through proper tax rate management. However, there are 53 separate taxing jurisdictions - 50 states plus Washington DC, Puerto Rico, and the Virgin Islands. Each of these 53 jurisdictions has their own set of SUI tax provisions, including compliance obligations that must be met. Navigating your internal tax rate management plan through this can be very time-consuming. In addition, these tricky tax laws can create a situation where employers unknowingly overpay employment-related taxes. Tax overpayments vary in type (e.g., FICA, FUTA, and SUI) and can be created without your knowledge, or due to circumstances beyond your control. Complying with these laws can be onerous, but can also produce significant opportunity. An opportunity that we've seen many companies fail to capture correctly. To help you navigate the employment tax landscape during an M&A, watch our webinar, Insider Tips to Protect Your Employment Tax Rates.
You’ll gain unique insight from the same experts who help our clients discover $130 million in potential tax savings in 2017 alone.* Get expert guidance that you can take straight to your bottom line!
*2017 Equifax client data
About the Author
Job Title: Managing Director, Employment Tax Consulting
Tom Towson is a Certified Public Accountant. He graduated cum laude from Missouri State University with a Bachelor of Science in accounting and from the University of Missouri — St. Louis with a master’s degree in accounting (emphasis in taxation). He joined Equifax Workforce Solutions in 2011 and specializes in employment tax matters (primarily focused on state unemployment insurance) associated with mergers and acquisitions, tax, strategic planning, and helping develop leading practices.
Before joining Equifax, Mr. Towson served as Chief Financial Officer of a St. Louis-based manufacturing firm, managing all aspects of the company’s financial matters, including income and employment tax functions during his five-year tenure. He spent the prior 16 years with a St. Louis-based public accounting firm where he was the shareholder in charge of taxation services.