As a 501(c)(3) non-profit organization, exempt from income tax under 501 (a), do I need to pay unemployment insurance taxes?

A non-profit organization (religious, charitable, or educational) qualifying for income tax exemption under Section 501(c)(3) of the Internal Revenue Code may elect a self-financed status under provisions of Chapter 383-62(d) of the Hawaii Employment Security Law.

1. Complete Form UC-175, Application for Self-Financing–Non-Profit Organization with the Department.
2. Liability for a self-financed reimbursable plan for a Non-Profit Organization would be an amount equal to the amount of regular benefits and of one-half of the extended benefits paid, that is attributable to service in the employ of such non-profit organization to individuals for weeks of unemployment which begin during the effective period of such election. You will be billed monthly for the benefits paid and payment must be made within 30 days of the billing date. No part of the required unemployment payments is to be deducted from the employee’s wages.
3. An account under the self-financed status must continue for a period of at least two (2) calendar years from the effective date.
4. A notice of termination of election must be made within 30 days prior to the beginning of the calendar year for which such termination shall be effective.
5. Upon notification of approval of Form UC-175, Application for Self-Financing—Non-Profit Organization, you will be requested to complete and return the following form: (1) UC-177, “Security Deposit Determination”, with a security deposit of .2 percent of the organization’s total wages projected for a full calendar year. The Department may, at any time, review the adequacy of the deposit made by any organization. If, as a result of such review, the Department determines that an adjustment is necessary, it shall require an additional deposit within 30 days of written notice. The deposit shall be retained by the Department in an escrow account until liability under the election is terminated, at which time it shall be returned to the organization, less any deductions.