NYS SINGLE OWNER SUBCHAPTER S SMALL BUSINESSES PENALIZED IF OWNER UNABLE TO DRAW SALARY DUE TO CHRONIC ILLNESS OR INSUFFICIENT SALES-UNEMPLOYMENT RATE RAISED TO THAT OF A START UP BUSINESS EVEN WHEN FOR MANY YEARS THERE WERE NO UNEMPLOYMENT CLAIMS.
I recently bore witness to a situation where an 84 year old man, chronically ill with heart disease, cancer and diabetes struggled to keep his small business open (as that was what kept him alive) and barely met the expense of his rent and overhead, was unable to pay himself a salary for 12 consecutive months as there was not enough income. After receiving a notice requesting an explanation for not paying remuneration and explaining that he was ill, NYS Department of Labor increased his Unemployment Contribution rate from 1.225 to 3.425, an increase of 2.2%…even though in all the years that he was in business and healthy that no unemployment claims were ever made against his experience rating. So you have to love New York when they penalize an old man for trying to hold on to the only thing that kept him going, which was his business.
So as his health began to BARELY improve the $1,200 that he paid himself in the next quarter (3 months) cost him $41 instead of $14. That may not seem like a lot to most but to an old man living on sub poverty income, that is the cost of two meals.