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STATE OF IOWA
KIM REYNOLDS
GOVERNOR
June 5, 2025
The Honorable Paul Pate
Secretary of State of Iowa
State Capitol
Des Moines, Iowa 50319
Dear Mr. Secretary,
I hereby transmit:
Senate File 607, an Act relating to unemployment insurance taxes on employers.
The above Senate File is hereby approved on this date.
Sincerely,
Kim Reynolds
Governor of Iowa
STATE CAPITOL DES MOINES, IOWA 50319 515.281.5211 WWW.GOVERNOR.IOWA.GOV
WiLLUAiNTAI
:R A I. ASS KM B I.Y
Senate File 607
AN ACT
RELATING TO UNEMPLOYMENT INSURANCE TAXES ON EMPLOYERS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
Section 1. Section 96.lA, subsection 36, Code 2025, is
amended to read as follows:
36. "^Taxable vages'^ means an amount of wages upon which
an employer is required to contribute based upon wages which
that have been paid in this state during a calendar year to
an individual by an employer or the employer's predecessor-r
in this state or another state which extends a like comity to
this state, with respect to cmploymont, upon which the employer
is required to contribute, which equals the greater of the
following:
a. Sixty-six and two-thirds Thirty-three and one-third
percent of the statewide average weekly wage which that was
used during the previous calendar year to determine maximum
weekly benefit amounts, multiplied by fifty-two and rounded to
the next highest multiple of one hundred dollars.
b. That portion of wages subject to a tax under a federal
law imposing a tax against which credit may be taken for
contributions required to be paid into a state unemployment
compensation fund.
Sec. 2. Section 96.7, subsection 2, paragraph c,
subparagraphs (1) and (2), Code 2025, are amended to read as
follows:
Senate File 607r p. 2
(1) A nonconstruction contributory employer newly subject
to this chapter shall pay contributions at the rate specified
in the twelfth fourth benefit ratio rank but not less than
one percent until the end of the calendar year in which the
employer's account has been chargeable with benefits for
twelve consecutive calendar quarters immediately preceding the
computation date.
(2) A construction or landscaping contributory employer,
as defined under rules adopted by the department pursuant to
chapter 17A, which that is newly subject to this chapter shall
pay contributions at the rate specified in the twenty-first
ninth benefit ratio rank until the end of the calendar year in
which the employer's account has been chargeable with benefits
for twelve consecutive calendar quarters.
Sec. 3. Section 96.7, subsection 2, paragraph d,
subparagraph (1), Code 2025, is amended to read as follows:
(1) The current reserve fund ratio is computed by dividing
the total funds available for payment of benefits, on the
computation date or on August 15 following the computation
date if the total funds available for payment of benefits is a
higher amount on August 15, by the total wages paid in covered
employment excluding reimbursable employment wages during the
first four calendar quarters of the five calendar quarters
year immediately preceding the computation date. However,
in computing the current reserve fund ratioii—beginning July
i-i—2007i—one hundred fifty million dollars shall be added to
the total funds available for payment of benefits on each
computation date.
Sec. 4. Section 96.7, subsection 2, paragraph d,
subparagraph (2), subparagraph division (a). Code 2025, is
amended by striking the subparagraph division.
Sec. 5. Section 96.7, subsection 2, paragraph d,
subparagraph (2), subparagraph division (b), Code 2025, is
amended by striking the subparagraph division and inserting in
lieu thereof the following:
(b) If the current reserve fund ratio:
Equals or But is The contribution rate
exceeds less than table in effect shall be
Senate File 607, p. 3
— 0.50 A
0.50 0.90 B
0.90 1.30 C
1.30 — D
Sec. 6. Section 96.7, subsection 2, paragraph d,
subparagraph (2), subparagraph division (d). Code 2025, is
amended by striking the subparagraph division and inserting in
lieu thereof the following:
(d) Each employer qualified for an experience rating
shall be assigned a contribution rate for each rate year
that corresponds to the employer's benefit ratio rank in the
contribution rate table effective for the rate year from the
following contribution rate tables. Each employer's benefit
ratio rank shall be computed by listing all the employers by
increasing benefit ratios, from the lowest benefit ratio to the
highest benefit ratio and grouping the employers so listed into
nine separate ranks containing as nearly as possible fourteen
and twenty-nine hundredths percent of the total taxable wages,
excluding reimbursable employment wages, in the first six
ranks, and four and seventy-six hundredths percent of the total
taxable wages, excluding reimbursable employment wages, in
ranks seven, eight, and nine, paid in covered employment during
the four completed calendar quarters immediately preceding the
computation date. If an employer's taxable wages qualify the
employer for two separate benefit ratio ranks, the employer
shall be afforded the benefit ratio rank assigned the lower
contribution rate. Employers with identical benefit ratios
shall be assigned to the same benefit ratio rank.
Approximate Contribution Rate Tables
Benefit Cumulative
Ratio Taxable
Rank Payroll Limit A B C D
1 14.29% 0.000.00 0.000.00
2 28.58% 0.40 0.300.10 0.10
3 42.87% 1.200.800.400.20
4 57.16% 2.101.400.60 0.30
5 71.45% 3.602.401.100.50
6 85.74% 5.404.101.900.90
Senate File 607, p. 4
90.50%
95.26%
100.00%
5.40
5.40
5.40
5.40
5.40
5.40
4.20
5.40
5.40
2.00
2.80
5.40
Sec. 7. EMPLOYER SAVINGS. Any savings an employer receives
as a result of this Act should be used for at least one of the
following purposes:
1. To pay for employee salaries or benefits.
2. To use as an alternative to unemployment benefits during
periods of seasonal unemployment.
AMY SINC^IR
President of the Senate
PAT GRASSL]
Speaker or the House
I hereby certify that this bill originated in the Senate and
is known as Senate File 607, Ninety-first General Assembly.
Approved 2025
W. CHARLES SMITHSON
Secretary of^he Senate
KIM' REYNOLDS
Governor