FUTA Taxes: What Every Employer Needs to Know

Content Summary

FUTA is an employer tax. Your employees don’t pay it. Your payroll doesn’t withhold it. You do, based on the first $7,000 of each employee’s annual wages.

The rate is 6% of that amount. So, if you have an employee earning $35,000 a year, you calculate FUTA on $7,000, not the full $35,000. That equals $420 per employee.

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