Employer Payroll Tax Calculator
See what one employee's wages cost you in employer taxes — Social Security, Medicare, FUTA, and SUTA — before benefits.
Written by Dorothy Ibrahim, 10+ years in banking & finance
Reviewed by Benton Jona, EA (Enrolled Agent) — 2026-07-13
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How we calculate this
This calculator shows what one employee's wages cost you in employer-side taxes — your half of Social Security and Medicare, federal unemployment (FUTA), and state unemployment (SUTA) — before a dollar of benefits. It is the employer's view of a paycheck: these amounts come out of your pocket on top of the gross wage, typically adding several percent to every salary, and they scale across your headcount.
The formulas
- Employer Social Security
- 6.2% × min(annual wage, Social Security wage base)The wage base is $184,500 for 2026 ($176,100 for 2025) — the tax stops there.
- Employer Medicare
- 1.45% × annual wage (no cap)The 0.9% additional Medicare tax is employee-withheld only — there is no employer share.
- FUTA (federal unemployment)
- 0.6% × min(annual wage, $7,000)The 6.0% statutory rate less the standard 5.4% state credit; employers in credit-reduction states owe more.
- SUTA (state unemployment)
- your state rate × min(annual wage, your state wage base)Both the rate and base vary by state; the defaults (2.7%, $14,000) are typical new-employer figures — a rule of thumb.
- Total employer tax
- (Social Security + Medicare + FUTA + SUTA) × number of employees
Worked example
- Take the defaults: one employee earning $55,000/yr, a 2.7% SUTA rate on a $14,000 state wage base, tax year 2026.
- Employer Social Security = 6.2% × $55,000 = $3,410; employer Medicare = 1.45% × $55,000 = $797.50.
- FUTA = 0.6% × $7,000 = $42; SUTA = 2.7% × $14,000 = $378.
- Total employer tax = $3,410 + $797.50 + $42 + $378 = $4,627.50 — about 8.4% added on top of the wage before any benefits.
Rates, benchmarks & sources
- Employer FICA rates (6.2% + 1.45%), the $184,500 Social Security wage base for 2026, and the FUTA structure (6.0% less the 5.4% credit = 0.6% on the first $7,000) — SSA (2025-10-24); IRS; PayrollOrg (2026)
- Default SUTA new-employer rate (2.7%) and wage base ($14,000) — every state sets its own, and experience-rated employers see different rates — Rule of thumb (state-specific — verify with your state)
Figures current as of 2026-07-02. See our methodology & editorial standards for how constants are versioned and verified.
What this tool doesn’t model
- SUTA is genuinely state-specific: rates range widely by state and by your unemployment-claims experience, and wage bases vary from $7,000 to well over $50,000 — the defaults are a rule-of-thumb placeholder, so enter your state's actual figures.
- FUTA assumes the full 5.4% credit; employers in credit-reduction states (states with outstanding federal unemployment loans) owe a higher net rate.
- Taxes only — no workers' compensation insurance, health benefits, retirement match, or payroll-service fees; the True Cost of Employee tool covers the full loaded cost.
- It excludes local payroll taxes some jurisdictions levy, and state-run paid family/medical leave premiums.
- Federal figures are an estimate for planning, not payroll filing advice — actual deposits and Forms 941/940 have their own schedules and rules.
Frequently asked questions
What is the difference between what I withhold and what I pay as the employer?
Withholding (income tax, the employee's 6.2% and 1.45%) comes out of the employee's gross pay — it is their money you are remitting. This calculator counts only the employer-side taxes you pay in addition to the gross wage: your matching 6.2% Social Security and 1.45% Medicare, plus FUTA and SUTA, which are employer-only taxes the employee never sees.
Why is FUTA only $42 a year?
FUTA is 6.0% but almost every employer receives a 5.4% credit for paying state unemployment tax on time, leaving a net 0.6% — and it applies only to the first $7,000 of each employee's wages, hence 0.6% × $7,000 = $42. The exception: in credit-reduction states, where the state owes the federal unemployment fund, part of the credit is withheld and the net rate rises.
How do I find my actual SUTA rate?
Your state unemployment agency assigns it. New employers get the state's new-employer rate (often around 2–3%, which is why the tool defaults to 2.7% as a rule of thumb); after a few years you receive an experience rating that moves with your layoff history. The rate notice your state mails annually — or your payroll provider's dashboard — has the exact rate and wage base to enter here.
Do employer taxes stop once a salary gets high enough?
Partially. The 6.2% Social Security match stops at the wage base — $184,500 for 2026 — and FUTA and SUTA stop at their much smaller bases early in the year. But the 1.45% Medicare match has no cap and continues on every dollar. So the employer tax burden as a percentage of wage falls for high salaries, but it never reaches zero.
Does this cover everything hiring an employee will cost me in taxes?
It covers the core federal employer taxes plus a SUTA estimate, but it is federal-focused and approximate on the state side: local payroll taxes, state paid-leave premiums, and workers' compensation insurance (mandatory in most states) are excluded, and your real SUTA rate is state-assigned. It is an estimate for budgeting, not payroll filing advice — a payroll service or CPA handles the actual deposits.
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themoneysheet provides educational estimates, not financial, tax, or legal advice. Figures use published rates and formulas current as of the date shown, but your situation may differ. Consult a qualified professional (CPA, attorney, or licensed advisor) before making financial decisions. Federal figures only unless noted. State taxes vary.