MHIC NASCLA Contractors Practice Exam

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Prepare for the MHIC NASCLA Contractors Exam with our comprehensive quiz that includes multiple-choice questions designed to help you familiarize yourself with the exam format and increase your chances of passing. Get ready to succeed!

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What portion of wages must employers pay to cover unemployment insurance?

First $5,000
First $8,500
First $10,000
All wages

The correct answer is: First $8,500

Employers are required to pay unemployment insurance on a percentage of employee wages up to a certain limit, which is known as the taxable wage base. The amount specified in this context, the first $8,500, reflects the taxable wage base for unemployment insurance that employers must report and pay taxes on. This means that any wages earned beyond this threshold do not require additional unemployment insurance contributions from employers. This structured limit helps to manage the financial burden on employers while still contributing to the unemployment insurance fund that supports workers who lose their jobs. The amounts can vary by state and over time, but the $8,500 figure aligns with the historical standards in many jurisdictions. Understanding this threshold is crucial for contractors and employers in budgeting for labor costs and complying with state employment regulations.