US · 2026
Employer payroll tax calculator
Short answer
In 2026 an employer pays 7.65% of wages for social security and Medicare (6.2% up to $184,500, plus 1.45%), usually $42 of federal unemployment tax (FUTA), and state unemployment tax at its own rate. A $50,000 employee in Texas at the 2.7% new-employer rate costs $54,110 a year before benefits.
| Item | Per year | Per paycheck |
|---|---|---|
| Wages | $50,000.00 | $1,923.08 |
| Social security (6.2%) | $3,100.00 | $119.23 |
| Medicare (1.45%) | $725.00 | $27.88 |
| FUTA (0.6% of up to $7,000) | $42.00 | $1.62 |
| State unemployment | $243.00 | $9.35 |
| Employer taxes | $4,110.00 | $158.08 |
| Total cost | $54,110.00 | $2,081.15 |
Worked example: a $50,000 employee in Texas
A new Texas business hires one employee on $50,000 a year. Texas's 2026 taxable wage base is $9,000 and its new-employer rate is 2.7%, from the Department of Labor's July 2026 table.
| Line | Per year |
|---|---|
| Wages | $50,000.00 |
| Social security (6.2%) | $3,100.00 |
| Medicare (1.45%) | $725.00 |
| FUTA (0.6% of $7,000) | $42.00 |
| Texas unemployment (2.7% of $9,000) | $243.00 |
| Total cost | $54,110.00 |
Employer taxes add $4,110, or 8.22% of wages. The same employee on $200,000 in California, at its 3.4% new-employer rate on a $7,000 wage base, costs $11,439 of social security (6.2% of the $184,500 cap), $2,900 of Medicare, $42 of FUTA and $238 of state unemployment tax: $14,619 on top of wages.
State unemployment tax rates and wage bases for 2026
Each state sets its own taxable wage base and its own range of rates. Your rate arrives on a notice from the state's unemployment agency, usually once a year. The calculator fills in the state's new-employer rate and wage base; replace the rate with the one on your notice.
| State | Wage base | Rates | New employer |
|---|---|---|---|
| California | $7,000 | 1.5%–6.2% | 3.4% |
| Florida | $7,000 | 0.1%–5.4% | 2.7% |
| Texas | $9,000 | 0%–6.0% | 2.7% |
| New York | $17,600 | 2.025%–9.825% | 4.025% |
| Illinois | $14,250 | 0.2%–6.5% | 2.8% |
| Washington | $78,200 | 0%–5.4% | Industry average |
Where a state gives new employers their industry's average rate instead of one rate, such as Washington, Minnesota and Utah, the calculator leaves the rate for you to enter. The table's rates are for experience-rated employers and leave out surcharges and other state taxes collected with unemployment tax.
FUTA: why it is usually $42 per employee
The FUTA rate is 6.0% of the first $7,000 of each employee's wages in 2026, but employers who pay their state unemployment tax get a credit of up to 5.4%, so the rate after the credit is 0.6%. That is $42 for each employee who earns $7,000 or more in the year.
In a credit reduction state, a state that has borrowed from the federal government for unemployment benefits and not repaid it, employers get less credit and pay more FUTA, settled with the fourth-quarter deposit. The Department of Labor names those states each November. If yours is on the list, enter its reduction in the calculator.
General information, not tax advice. Figures from IRS Publication 15 (2026) and the U.S. Department of Labor's Significant Provisions of State Unemployment Insurance Laws, effective July 2026, read 8 October 2026.
The official method, step by step
- Social security: the employer pays 6.2% of each employee's wages up to the $184,500 wage base for 2026, matching the 6.2% withheld from the employee.
- Medicare: the employer pays 1.45% of all wages, with no limit. The extra 0.9% Additional Medicare Tax on wages over $200,000 is withheld from the employee only; there is no employer match.
- FUTA: 6.0% of the first $7,000 of each employee's wages, less a credit of up to 5.4% for state unemployment tax paid on time. With the full credit that is 0.6%, or $42 per employee for the year.
- State unemployment tax (SUTA): the state's rate for your business on wages up to the state's taxable wage base. New employers get a set rate in most states; after a few years the rate follows your own layoff history.
- Add benefits you pay for (health insurance, retirement contributions) and anything else the job costs you, and the total is the employee's cost for the year.
What this leaves out
- Other state employer taxes and fees, such as training taxes, paid family leave premiums and disability insurance, where the employer pays a share
- Local payroll taxes, such as city or county head taxes
- Workers' compensation insurance, which is priced by your insurer or state fund
- Employees paid partly in another state, and state unemployment taxes paid by employees (Alaska, New Jersey and Pennsylvania withhold a small share)
- Taxes withheld from the employee's pay, which come out of wages rather than adding to them
Sources: IRS Publication 15 (2026), (Circular E) Employer's Tax Guide: employer social security 6.2% up to $184,500 and Medicare 1.45%; section 14, FUTA 6.0% of the first $7,000 with a credit of up to 5.4% (0.6% after the credit), credit reduction states (read October 8, 2026); U.S. Department of Labor, Office of Unemployment Insurance: Significant Provisions of State Unemployment Insurance Laws, Effective July 2026 (taxable wage base, minimum and maximum rates, new employer rate, by state) (read October 8, 2026).
Employer payroll tax calculator: common questions
How much does an employee cost on top of salary?
At least 7.65% for social security and Medicare, plus FUTA and state unemployment tax. For a $50,000 employee in Texas at the new-employer rate, that is $4,110, 8.22% of wages, before benefits, insurance and equipment.
What payroll taxes does an employer pay?
Its share of social security (6.2% up to $184,500 in 2026) and Medicare (1.45%), federal unemployment tax (FUTA) and state unemployment tax. Income tax and the employee's share of FICA are withheld from pay, not paid on top.
What is the employer payroll tax rate for 2026?
7.65% of wages up to $184,500 and 1.45% above it, plus FUTA at 0.6% of the first $7,000 and your state unemployment rate on its wage base. New-employer state rates run from 1% to just over 4% in most states.
Does the employer pay the 0.9% Additional Medicare Tax?
No. The 0.9% on wages over $200,000 is withheld from the employee only. The employer withholds it but doesn't match it, so the employer's Medicare stays at 1.45% of all wages.
What is my state unemployment tax rate?
The rate on your state unemployment agency's rate notice. A new business usually starts at the state's new-employer rate, shown in the calculator, and moves to an experience rate after a few years of contributions.
Why is FUTA only $42?
FUTA is 6.0% of the first $7,000 of wages, and paying state unemployment tax on time earns a credit of up to 5.4%. What's left, 0.6% of $7,000, is $42 per employee for the year, unless your state is a credit reduction state.
Are employer payroll taxes the same every paycheck?
Social security and Medicare are, until wages reach $184,500. FUTA and state unemployment tax stop once wages reach $7,000 and the state's wage base, so most of them is paid in the first months of the year. The calculator's per-paycheck column is the year's cost spread evenly.
Can I make a pay stub for this employee?
Yes. “Make this employee's pay stub” opens the pay stub generator with the gross pay per paycheck. Employer taxes don't appear on an employee's pay stub; the generator works out what to withhold.
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