My first surprise of 2012…Federal Unemployment Tax

As a business owner, I am excited as each new year begins. It is a chance to start fresh, wiping the slate clean from the previous year. Setting goals for the year, evaluating successes and challenges from the previous year and analyzing ways to improve are vital to any organization. Despite all of the reflection and planning, what we find true in everyday life is often applicable to business – the best laid plans can go to waste. No matter how much mapping out and budgeting we do, we can be faced with the unexpected.

My first unexpected item came in the form of the Federal Unemployment Tax (FUTA). In January, it was announced that employers in Virginia (along with twenty other states) will have the 2011 FUTA adjusted on our annual tax returns. In short, this means an increased tax passed along to employers. The Federal Government can impose this when states have not paid back outstanding Federal loans. In this case, Virginia unemployment funds were depleted during the severe economic downturn which led to a Federal loan.

As with many families in America, a small business owner feels a deep impact from too many blips in the budget. This has a negative effect on the economic trend in our country when families and businesses have less money to put back into the economy.  I do hope that these states will set their goals for 2012 ina way that will allow small businesses to have an accurate payroll deduction for the majority of the year and to plan accurately for coming years.

Flexibility is a trait that employers consistently look for in their employees and vice versa. That being said, I will take my best laid plans and readjust…and perhaps I will add “expect the unexpected” to my list of annual goals!

Susan Frank, UDig Chief Executive Officer