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More than 35% of nonprofits reimburse their unemployment

By April 1, 2018October 11th, 2022No Comments

Results of a new survey conducted by 501(c) Services indicates that at least one-third of all 501(c)(3) nonprofits with payrolls over $1 million currently reimburse their unemployment. According to the survey, 64 percent of those responding pay state unemployment insurance taxes, and 36 percent reimburse the state for their unemployment claims.

“To be honest, we knew a large percentage of 501(c)(3)s with payrolls over $1 million reimburse,” said Cynthia Koral, CMO for 501(c) Services. “We’ve been helping nonprofits reimburse for more than 35 years, so we had an educated assumption of the ratio. But I’d be lying if I said we thought it would be over one-third of that group. This is really good news for nonprofits.”

The goal of the survey was to better gauge how many nonprofits across the country pay state unemployment insurance taxes versus those that do not and reimburse the state for their unemployment claims. 501(c) Services polled over 20,000 501(c)(3) nonprofit executives from organizations with payrolls over $1 million.

(Also Read: Numerous States announce 2022 unemployment tax increases)

“The results of the poll, to us, indicates that 501(c)(3)s are considering all their options and looking for ways to save as much of their budget for services as possible. We are excited to have a clearer picture of that now,” said Koral.

The reason for surveying only those organizations that have payrolls over $1 million is tied to company philosophy.

“There are organizations that reimburse who have payrolls under $1 million,” said Koral. “But in our experience, a reimbursing nonprofit saves the most money and sees a safe amount of risk if their payroll exceeds $1 million. For the work we do and the organizations we work with, the $1 million payroll threshold seemed to be a good place to begin our research.”

The survey was conducted March 20 – 23, 2018 via email to 22,437 501(c)(3) nonprofits across the United States.


501(c) Services has 40 years of experience providing full-service unemployment management programs. Some of the programs we administer are 501(c) Agencies Trust and 501(c) HR Services. To see if your organization would benefit from our services, please contact us today.

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