Unemployment Contributions

• Although employees are the beneficiaries of unemployment insurance, they are not the ones paying for it. Through its payroll tax levies, each state collects funds from businesses and organizations that hire employees. The payments are due each quarter and are based on a percentage of the company’s payroll and the number of past employees who collected unemployment.
  
  

The Church Exemption

• Not every employer must pay into the state’s unemployment insurance trust fund. Typically, there are exemptions for certain companies, such as those under a certain threshold of payroll payments or certain nonprofits. While state laws vary, churches are often exempt from paying taxes on their employees’ salary to the unemployment fund.
  
  

Insured Wages

• Insured wages are those earned from employment covered under that state’s unemployment compensation laws. This money is important in determining unemployment eligibility and later, the amount of compensation. Since church employees are generally exempt, wages earned as a church daycare employee don’t count when the state is reviewing an unemployment claim.
  
  

Eligibility

• Each state has a financial eligibility requirement based on its own unemployment insurance compensation laws. This is an amount of insured wages you must have earned in the 15 to 18 months before you filed your claim. If your only work during this period was a church daycare worker, you don’t qualify for benefits. However, if you worked some other employment that falls under insured wages, you may still be able to collect if you made enough to meet the eligibility requirements.