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FUTA Tax Calculator
Sign up to favourite this calculatorEstimate federal unemployment (FUTA) tax, taxable wages and remaining wage base headroom from the wages you enter, for one employee or a team.
Your FUTA tax
Based on a $7,000 FUTA wage base for the year.
FUTA tax
FUTA taxable wages
$7,000.00Remaining wage base headroom
$7,000.00Before this calculationRate used
0.60%Net, after the standard creditEmployees included
1Uses 2026 rates, last reviewed 28 September 2026.
| Gross wages entered | $9,000.00 |
|---|---|
| YTD wages already counted | $0.00 |
| FUTA wage base | $7,000 |
| Taxable wages after the cap | $7,000.00 |
| Headroom remaining after this payment | $0.00 |
| Gross FUTA tax (statutory rate) | $420.00 |
| Net FUTA tax (after the standard credit) | $42.00 |
| FUTA tax | $42.00 |
Quarterly breakdown
| Quarter | Wages paid | Taxable wages | FUTA tax |
|---|---|---|---|
| Total |
Assumptions used in this result
| FUTA wage base | $7,000 |
|---|---|
| FUTA gross rate | 6.00% |
| FUTA net rate (after the standard 5.4% credit) | 0.60% |
| Calculation basis | Single employee |
| Wage entry | Annual wages, with YTD wages already counted |
FUTA applies only to the federal unemployment wage base shown above. State unemployment tax (SUTA) is calculated separately and is not included in this result.
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Assumptions and limits
- An estimate from the numbers you entered, for guidance only. It is not financial, tax or medical advice.
- Calculator version 1, rates last reviewed 28 September 2026, last updated 25 October 2026.
- Source: IRS: Topic no. 759, Form 940 – Employer's Annual Federal Unemployment (FUTA) Tax Return.
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How to use this calculator
Enter your wages and the FUTA rate and wage base, and the result updates as you type. Every figure defaults to a working example — replace it with your own numbers.
- Choose a single employee or multiple employees, and enter the employee count if needed.
- Choose annual or quarterly wage entry. Annual mode takes the wages for this calculation plus what has already been paid year-to-date; quarterly mode takes wages for each of the four quarters.
- Check the FUTA wage base and gross rate, which default to the standard federal figures — $7,000 and 6.0%.
- Turn on "Show net rate after the standard 5.4% credit" to see the effective 0.6% rate, and add a state credit reduction if your state has one this year.
Results update as you change any figure. Use Reset to return to the worked example.
What do I need to enter?
- Employees — Single employee, or Multiple employees with a whole-number count from 1 to 100,000. Every employee gets the same wage figures.
- Wage entry — Annual or Quarterly. Annual takes the wages for this calculation and the wages already paid this year; Quarterly takes Q1 to Q4 wages.
- Wages paid this year and wages already paid year-to-date — each 0 to $10,000,000. Wages already paid use up part of the wage base first.
- Q1 to Q4 wages — each 0 to $10,000,000, with the wage base applied across the quarters in order.
- FUTA wage base and gross rate — the wage base ($7,000 by default, up to $1,000,000) and the gross rate (6.0% by default, 0% to 100%).
- Net rate and state credit reduction — optional. Show the net rate after the standard 5.4% credit, and add a state credit reduction of 0% to 5.4%.
What do the results show?
- FUTA tax — the main figure: taxable wages × the rate used, totalled across all employees included.
- FUTA taxable wages — the wages that count after the wage base cap.
- Remaining wage base headroom — how much of the wage base was left before this calculation.
- Rate used — the gross statutory rate, or the net rate after the credit.
- Quarterly breakdown — wages, taxable wages and FUTA tax for each quarter, shown in Quarterly mode.
How is FUTA tax calculated?
Taxable wages are capped at the FUTA wage base per employee, per year. FUTA tax is taxable wages multiplied by the rate used — the 6.0% gross statutory rate, or the net rate after the standard 5.4% credit if you show it.
FUTA taxable wages = max(0, min(wages this calculation, wage base − wages already counted))
- Remaining wage base headroom = max(0, wage base − wages already counted)
- FUTA tax = taxable wages × rate used (gross 6.0%, or net after the 5.4% credit)
- Net rate = gross rate − (5.4% − state credit reduction), usually 0.6%
- Multiple employees: each gets their own wage base — totals are never pooled
For example, an employee paid $9,000 for the year against the standard $7,000 wage base has $7,000 in taxable wages — the remaining $2,000 is above the base and is not subject to FUTA. At the gross 6.0% rate that is $420 in FUTA tax; at the standard net rate of 0.6% after the full credit, it is $42.
What does this calculator assume?
- Every wage, rate and wage base figure is one you enter or a clearly labelled statutory default — nothing is inferred or looked up automatically.
- Multiple-employee mode applies the same wage figures to every employee included; there is no per-employee wage list.
- This calculator covers federal FUTA tax only. State unemployment tax (SUTA) rates and rules are set separately by each state and are not calculated here. For the employer and employee share of Social Security and Medicare tax on the same wages, see the FICA Tax Calculator.
- This is a planning estimate, not Form 940 or any other tax filing, and not legal or tax advice.
Important information
Important: This is a payroll planning tool, not tax filing software, legal advice, or a full payroll system. It does not recommend hiring, tax strategy or compliance action.
Confirm current wage bases, rates and any state credit reduction with the IRS or a payroll professional before relying on these figures.
Frequently asked questions
What is FUTA tax?
FUTA is the federal unemployment tax employers pay under the Federal Unemployment Tax Act. It funds unemployment compensation and is paid entirely by the employer — it is never withheld from an employee's wages. This calculator estimates it from the wages, wage base and rate you enter; it is a payroll planning tool, not tax filing software.
What is the FUTA wage base?
The FUTA wage base is the amount of each employee's wages, per year, that FUTA tax applies to — the standard federal wage base is $7,000. Once an employee has been paid $7,000 in a year, no further wages that year are subject to FUTA, no matter how much more they earn. Each employee has their own $7,000 base; it is never shared or pooled across employees.
What is the difference between the gross and net FUTA rate?
The gross statutory FUTA rate is 6.0% of taxable wages. Employers who pay their state unemployment tax (SUTA) in full and on time can generally claim a credit of up to 5.4%, bringing the effective rate down to 0.6%. This calculator shows the net rate only when you turn on "Show net rate after the standard 5.4% credit" — otherwise it uses the gross statutory rate.
What is a state FUTA credit reduction?
If a state has an outstanding federal unemployment loan balance, the IRS can reduce that state's standard 5.4% credit for the year, which raises the effective net FUTA rate above 0.6% for employers in that state. This calculator does not know your state or look up reduction schedules — if a reduction applies to you, turn on the state credit reduction toggle and enter the percentage yourself.
How is FUTA taxable wages calculated for one payment?
Taxable wages for a payment are the smaller of the wages being paid now and the wage base headroom still remaining — the wage base ($7,000 by default) minus wages already paid to that employee earlier in the year. Once year-to-date wages reach the wage base, taxable wages for any further payment are zero, which is why the calculator flags this case directly.
How does the quarterly view work?
Switching wage entry to quarterly lets you enter wages paid in each of the four quarters instead of a single year-to-date figure. The calculator applies the wage base cumulatively across the quarters in order, so once an employee's wages reach the base — in Q2, say — every later quarter shows zero taxable wages even if more was paid.
How is FUTA tax calculated for multiple employees?
Turn on "Multiple employees" and enter how many are included. The calculator applies the same wage figures to each employee and multiplies the per-employee result by the employee count — every employee gets their own full wage base, so wage bases are never pooled or shared across the team.
Does this calculator include state unemployment tax (SUTA)?
No. This calculator covers federal FUTA tax only. State unemployment insurance (SUTA) rates, wage bases and rules are set separately by each state and are not calculated here — check your state unemployment agency for those figures.
Is this calculator tax filing software or legal advice?
No. It is a payroll planning estimate built entirely from the wages, wage base and rates you enter or the clearly labelled statutory defaults. It does not file Form 940, does not know your state, and does not recommend hiring, tax strategy or compliance action — confirm figures against current IRS guidance or with a payroll professional before relying on them.
Last updated 25 October 2026. Rates last reviewed 28 September 2026. Source: IRS: Topic no. 759, Form 940 – Employer's Annual Federal Unemployment (FUTA) Tax Return.