Zero out FUTA credit reduction for states that exited credit-reduction status - #9326
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…n status AR, AZ, CT, DE, FL, GA, and IL kept their last nonzero credit-reduction rate indefinitely because the parameter never returned them to zero after they repaid their Title XII loans. Add the zero-out entries verified against the IRS Schedule A (Form 940) forms for 2013, 2014, and 2023, with regression tests for the exit years. Fixes PolicyEngine#9325 Co-Authored-By: Claude Fable 5 <noreply@anthropic.com> Claude-Session: https://claude.ai/code/session_01MPoZoUr5EF2ZsBbubBPuHu
Address the review's test-coverage gaps on PolicyEngine#9326: - Persistence: FL 2015 and 2026 stay at the standard 0.6% rate, proving the zero-out persists under carry-forward rather than being a single-year override. - Untested exits: add AZ (2013), AR (2014), DE (2014) exit-year cases. - Still-reduced guard: CA 2023 (0.012 = 0.006 net + 0.006 reduction -> $84) and CT 2022 prior-year (0.009 -> $63), confirming the fix did not over-zero. Also anchor the 2023 Schedule A reference at the instructions page (#page=2) where the credit-reduction jurisdiction list appears. FUTA suite 15/15. Co-Authored-By: Claude Opus 4.8 <noreply@anthropic.com>
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Aug 24, 2026
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Fixes #9325
What
gov/irs/payroll/federal_unemployment/credit_reduction_rate.yamlrecorded the years each state entered FUTA credit-reduction status but, for seven states, never returned the rate to zero after the state repaid its Title XII loans — so the last nonzero rate carried forward indefinitely and the model overcharged those states 0.3–0.9pp on FUTA taxable wages every year since (≈$1.1B/year in aggregate on the national dataset).Adds the missing zero-out entries, each verified against the IRS Schedule A (Form 940) for the exit year (the form prints every state's reduction rate):
2013-01-01: 02013-01-01: 02014-01-01: 02014-01-01: 02014-01-01: 02023-01-01: 02023-01-01: 0The three Schedule A form PDFs are added to the parameter's references. All other entries were checked against the same forms and left unchanged (e.g., DE's 0.006 is correctly still in force in 2013; CT's 1.7% in 2014 matches).
Tests
Adds regression tests to
employer_federal_unemployment_tax.yamlcovering FL in 2012 (add-on still applies: 1.2% × $7,000 = $84) and the exit years for FL (2013), GA (2014), CT (2023), and IL (2023), each back at the standard 0.6% × $7,000 = $42. The unemployment and employer_payroll_tax suites pass locally.Not changed here: CA's
2025: 0.012and VI's2025: 0.045carry forward into 2026+ as last-known values; whether to project DOL's 0.3pp/year escalation is a separate modeling decision (noted in #9325).🤖 Generated with Claude Code
https://claude.ai/code/session_01MPoZoUr5EF2ZsBbubBPuHu