SUTA + FUTA Employer Unemployment Tax Calculator 2026
Calculate your 2026 federal FUTA + state SUTA unemployment tax bill. Enter total wages, employees, state, and SUTA rate — get FUTA gross 6.0%, the 5.4% state credit, the effective 0.6% federal rate, plus your full state unemployment tax. Covers the eight largest US states (CA, TX, FL, NY, IL, WA, PA, OH). Free, private, runs entirely in your browser.
| Step | Amount |
|---|
Source: IRS Form 940 (FUTA) + U.S. DOL state SUTA agency directory. Last updated: May 3, 2026.
What Are FUTA and SUTA Employer Unemployment Taxes?
FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act) are payroll taxes paid entirely by employers — not withheld from employee paychecks — to fund the joint federal-state unemployment insurance system. Both apply to wages up to a per-employee wage base, and timely SUTA payment unlocks a large FUTA credit. Source: IRS Form 940 and U.S. Department of Labor (oui.doleta.gov). Last updated: May 3, 2026.
For 2026 the federal FUTA wage base remains $7,000 per employee per year and the gross rate is 6.0%. Employers who pay state SUTA on time and in full receive a 5.4% credit, dropping the effective FUTA rate to 0.6% — that is just $42 per employee per year. The combined FUTA + SUTA is reported annually on IRS Form 940 (federal) and quarterly state wage reports.
How the FUTA Credit Works
The FUTA credit is the single biggest lever in your unemployment tax bill. If you pay state SUTA timely (by the federal Form 940 due date) and your state is not a credit-reduction state, you claim the full 5.4% credit and pay only $42/employee/year in federal tax. If you skip or delay SUTA, you owe the full 6.0% rate ($420 per employee — a 10× swing). Credit-reduction states (states that have not repaid federal unemployment loans within the deadline) lose 0.3% of credit per delinquent year, raising the effective FUTA rate by that increment. California was a credit-reduction state for over a decade until repaying its loan; the IRS publishes the current credit-reduction list each November on Schedule A of Form 940.
State SUTA Wage Bases and Rates Vary Widely
Unlike FUTA's flat $7,000 base, state SUTA wage bases range from $7,000 (CA, FL, AZ) up to over $72,000 (WA in 2026). Each employer is assigned an experience-rated SUTA rate that reflects the unemployment claims charged to its account — new employers pay a state default rate (typically 2.7% to 3.95%), while established employers can fall as low as 0.1% with a clean claim history or rise above 6% with frequent claims. This calculator covers the eight most populous states (CA, TX, FL, NY, IL, WA, PA, OH) with 2026 wage base defaults; you can override any value if your state assigned you a different rate. Verify your assigned rate on your state agency rate-determination notice mailed annually each November or December.
Common Compliance Mistakes to Avoid
Three errors cost employers thousands every year. First, missing the Form 940 deadline (January 31 for the prior tax year) can void your 5.4% credit retroactively. Second, misclassifying employees as 1099 contractors when the IRS or state agency disagrees triggers back-FUTA, back-SUTA, plus penalties and interest. Third, paying SUTA in a state where the work was not performed — an issue for remote employees crossing state lines — can result in double SUTA assessments. Always run wages through the SUTA wage base for the state where each employee actually performs work, and reconcile state and federal returns before filing Form 940.