Nonprofit, governmental, and tribal entities can choose to cover their mandatory unemployment costs in one of two ways: paying the SUI tax (also referred to as SUTA) or going through reimbursement financing (self-insurance). The latter option is a legal right available only to 501(c)(3) nonprofit, governmental, and tribal entities, allowing them to opt-out of paying SUI taxes and to reimburse their state unemployment agency dollar-for-dollar for unemployment claims paid to former employees.
However, though opting out of paying SUI taxes can save money in the short term, it exposes organizations to potential risks such as unexpected loss of funding or program closures that can lead to layoffs. A well-thought-out strategic plan should accompany the decision to change unemployment financing on how to pay for future unemployment claims and limit claim liability.
Note: 501(c)(3) nonprofit, governmental, and tribal entities are all exempt from paying Federal Unemployment Taxes (FUTA).
Major benefits to all First Nonprofit customers include vital security, greater efficiency and cost effectiveness. Our services are individually insured and we partner with third-party claims administrators who insure state compliance, accuracy of benefit charging, and complete satisfaction.
refunded or waived fees totaling $12.8 million over the last year
customer retention rate
dollars in recovered excess loss claims since 2010
average employer tax savings since 2015
First Nonprofit has been a great partner. They have helped us saved hundreds of thousands of dollars! They have awesome resources for our nonprofit organization. Thanks for the partnership.
First Nonprofit has saved us so much money over the state’s program. We had one little glitch with the state recently and we contacted FNP immediately. FNP staff called us back immediately and moved to remedy the problem.
Luckily for us, our interactions regarding any issues with staffing has been very minimal! I can say that all other interactions with regards to billing, 941 reporting, etc. have been extremely pleasant, accommodating and easy to work with. Kim Ghanayem is always prompt, professional and friendly. Thank you so much!
First Nonprofit has been easy to work with and makes the administrative process easier and smoother. We enjoy working with you.
I have worked with the First Non-Profit Team for many years, and I appreciate the quick response and care that Cecilia and the team provides anytime I have questions. While there are other providers that may provide like services, First Nonprofit will always be my first choice! I appreciate you!
I would like to comment on my experience with FNP….to date our District has saved $1,000’s of dollars by being enrolled in the First Nonprofit program. My only regret is that we did not know about this method of paying unemployment tax years ago….as I had figured about five years
ago, had we enrolled 15-20 years ago, we could have saved our small school district upwards of $500,000 in payments to IDES. Also we would have had a pretty hefty sum of money in our Reserve Account. Thankfully I attended a workshop hosted by First Nonprofit back in 2015 which got the ball rolling!
My experience with the FNP has been fantastic. The idea of setting funds aside for the unemployment tax liability is a bedrock for nonprofit organizations like mine, namely ASHBA; what is even more advantageous is having the FNP as a custodian of those funds. 100% recommended!
First Nonprofit smoothed the unemployment perils for our organization during Covid. Without the ability to cap our UI exposure, we would not have been able to weather the storm. The program worked perfectly and we have come out of the pandemic ready to forge on. Thanks FNP!