Free Employer Payroll Tax Calculator
Enter an employee's annual salary to estimate your employer-side payroll tax cost.
* Assumes full FUTA credit (0.6% effective rate). SUTA rates vary widely by state, industry, and employer experience rating — check your state's rate notice for exact figures.
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What Are Employer Payroll Taxes?
Employer payroll taxes are taxes an employer pays on top of an employee's gross wages — separate from the taxes withheld from the employee's paycheck. These are a direct, mandatory cost of employment that many hiring budgets underestimate.
Employer Payroll Tax Components
| Tax | Rate | Wage Base | Notes |
|---|---|---|---|
| Social Security (employer match) | 6.2% | $168,600 (2024) | Matches employee's 6.2% contribution |
| Medicare (employer match) | 1.45% | Uncapped | No additional 0.9% surtax for employer (only employee pays that) |
| FUTA (Federal Unemployment) | 0.6% (effective) | First $7,000/employee | 6.0% statutory, but 5.4% credit for on-time state SUTA payment |
| SUTA (State Unemployment) | Varies (~1–6%) | Varies by state ($7K–$60K+) | Rate depends on state, industry, and employer's claims history |
Quick Reference: Employer Tax by Salary
Estimated annual employer payroll tax at a 2.7% SUTA rate (typical new-employer average):
| Annual Salary | Employer FICA (7.65%) | FUTA | SUTA (2.7%, capped $7K) | Total Employer Tax |
|---|---|---|---|---|
| $40,000 | $3,060 | $42 | $189 | ≈ $3,291 |
| $60,000 | $4,590 | $42 | $189 | ≈ $4,821 |
| $80,000 | $6,120 | $42 | $189 | ≈ $6,351 |
| $100,000 | $7,650 | $42 | $189 | ≈ $7,881 |
| $150,000 | $11,475 | $42 | $189 | ≈ $11,706 |
Note: SUTA is capped at each state's wage base (often $7,000–$15,000), so it becomes a fixed cost per employee rather than scaling with salary. Use the calculator above with your actual state SUTA rate for precise figures.
Frequently Asked Questions
What is the employer payroll tax rate?
Employers typically pay 7.65% in FICA taxes (6.2% Social Security + 1.45% Medicare), plus FUTA (effectively 0.6% on the first $7,000 of wages) and SUTA (varies by state, usually 1–6% on a capped wage base). Combined, this adds roughly 8–11% on top of gross wages for most salary levels.
Is FICA paid by both employer and employee?
Yes. FICA is split evenly — the employee has 7.65% withheld from their paycheck, and the employer pays a matching 7.65% on top. This calculator estimates only the employer's share.
What is FUTA and who pays it?
FUTA (Federal Unemployment Tax Act) is paid entirely by the employer — never deducted from employee wages. The statutory rate is 6.0% on the first $7,000 of each employee's wages, but employers who pay state unemployment tax on time receive a 5.4% credit, reducing the effective rate to 0.6%.
What is SUTA and how is the rate determined?
SUTA (State Unemployment Tax Act) is a state-level payroll tax, also paid entirely by employers. Rates vary by state and are influenced by the employer's "experience rating" — companies with more layoffs/claims pay higher rates. New employers typically start at a state-average rate, often 2–4%.
How much extra does an employee really cost beyond their salary?
Beyond payroll taxes (roughly 8–11%), employers typically add benefits (10–20%), workers' comp insurance, and overhead — bringing total employment cost to 1.25x–1.4x base salary. See our Employee Cost Calculator for the full picture.
