The joint federal-state Unemployment Insurance (UI) system provides temporary and partial wage replacement to involuntarily unemployed workers and stabilizes the economy during recessions. Two permanent law unemployment benefits—Unemployment Compensation (UC) and Extended Benefits (EB)—are countercyclical, with spending and weekly benefit payments that increase automatically during a recession. States administer unemployment benefits under their state laws, with U.S. Department of Labor (DOL) oversight, resulting in 53 different UC programs operated in the states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. The Unemployment Trust Fund (UTF) in the U.S. Treasury accounts for transactions related to UC and EB. The UTF is a single trust fund with 59 accounts: the Employment Security Administration Account (ESAA); the Extended Unemployment Compensation Account (EUCA); the Federal Unemployment Account (FUA); 53 state accounts (including the District of Columbia, Puerto Rico, and the U.S. Virgin Islands); the Federal Employees Compensation Account (FECA); and two accounts related to the Railroad Retirement Board (RRB). Congress has shown interest in the operations of the UTF as part of its oversight of the UI system. For example, at a June 2024 hearing on “Reforming Unemployment Insurance to Support American Workers and Businesses,” the Subcommittee on Work and Welfare of the House Committee on Ways and Means discussed several reform issues, including the reconsideration of the method through which funding for state administration is collected and distributed via the UTF. This report provides a figure that displays FY2026 flows of funding through the UTF. Specifically, this figure includes projections from DOL related to the income, outlays, and end-of-year balances of the UTF as well as relevant FY2026 annual appropriations data, which are enacted amounts under P.L. 119-75, the Consolidated Appropriations Act, 2026. This report also describes, including relevant statutory authorities, UTF sources of revenue, accounts, statutory transfers, federal loans to states, UC appropriations out of ESAA, and outlays on unemployment benefits. For a broad overview of the UC program, see CRS In Focus IF10336, The Fundamentals of Unemployment Compensation. For additional information on how UC benefits are funded through the UTF, see CRS Report RS22077, Unemployment Compensation (UC) and the Unemployment Trust Fund (UTF): Funding UC Benefits.
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