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The futa tax rate is 6.0% Beginning october 6, 2025, the maximum weekly benefit amount (wba) for unemployment claims will increase from $504 to $869 per week. The tax applies to the first $7,000 you paid to each employee as wages during the year
The $7,000 is often referred to as the federal or futa wage base The taxable wage base is estimated to increase from $12,800 in 2025 to $16,900 in 2026 Your state wage base may be different based on the applicable state's rules.
To access from the payo home page select compliance and then state unemployment wage bases under overview. the federal unemployment tax act (futa) requires that each state’s taxable wage base must at least equal the futa taxable wage base of $7,000 per employee, and most states have wage bases that exceed the required amount.
Understanding how futa affects payroll is essential if you’re planning to hire employees Learn the latest futa rates, reporting requirements and more. While the initial $7,000 is known as the “futa wage base,” a state unemployment tax act (suta) may modify this base Plus, employers that pay their federal and state unemployment taxes in full may have the opportunity to earn a tax credit worth up to 5.4% of their futa taxable wages.
Ers assigned the maximum rate Base, assuming no law change Some states apply various formulas to determine the taxable wage base, others use a percentage of the state’s average annual wage, and many simply follow the futa wage base. A chart of state taxable wage bases for 2026, 2025, 2024, and 2023 may be downloaded below
States that have changed their wage base for 2026 are highlighted in bold face.
Find out how to report the employer’s annual federal unemployment (futa) credit reduction and how credit reduction states are determined. After 2026, the wage base is permanently adjusted on january 1 of each year to 16% of the state average annual wage, rounded up to the nearest $100 The state average annual wage is established no later than may 31 of each year.
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