Unemployment tax wage base

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Unemployment tax wage base is a term that refers to the amount of wages per employee on which an employer is taxed in order to fund the joint federal-state unemployment insurance program.

Employers do not pay unemployment taxes on employee earnings above the wage base.

The wage bases for state unemployment (SUTA) taxes vary by state. Federal unemployment (FUTA) taxes had a wage base of $7,000 as of April 2023.

Federal unemployment tax wage base

See also: Federal Unemployment Tax

While state tax amounts vary, the Federal Unemployment Tax Act (FUTA) tax is 6% of the federal unemployment tax wage base—the first $7,000 of an employee's wages—as of April 2025. Employers can receive an offset of up to 5.4% of their FUTA tax when they pay state unemployment taxes on time. An employer that receives the full 5.4% FUTA credit, therefore, pays 0.6% of the first $7,000 of an employee's wages, or $42, in FUTA tax per qualifying employee.[1][2]

FUTA tax credits are reduced for employers in states that have outstanding federal unemployment loans from the Unemployment Trust Fund’s Federal Unemployment Account on January 1 for at least two consecutive years. If states do not pay federal unemployment loans back by November 10 of the second consecutive year, FUTA tax credits are reduced by 0.3%. The reduction would limit the maximum FUTA tax credit to 5.1%, and employers would pay at least $63 in FUTA taxes per employee making $7,000 or more.[3]

State unemployment tax wage bases

See also: State unemployment tax

Wage bases for SUTA taxes vary by state. The following bulleted list describes selected wage base highlights for the year 2025:[4][5]

  • Oregon had the lowest wage base at $1,500.
  • Washington had the highest wage base at $72,800.
  • The average unemployment tax wage base was $21,547.

The table below outlines regular SUTA tax rate ranges for experienced employers and wage bases and new employer SUTA tax rates for all 50 states as of January 2025.

State unemployment tax rates
State SUTA new employer tax rate Employer tax rate range[6] SUTA wage bases
Alabama 2.7% 0.20% – 6.80% $8,000
Alaska 1.0% 1.00% – 5.40% $51,700
Arizona 2.0% 0.04% – 9.72% $8,000
Arkansas 2.0% 0.1% – 5.0% $7,000
California 3.4% 1.5% – 6.2% $7,000
Colorado 3.05% 0.64% – 12.34% $27,200
Connecticut 2.2% 0.1% – 10.0% $26,100
Delaware 1.0% 0.3% – 5.4% $12,500
D.C. 2.7% or prior year average 1.00% – 7.40% $9,000
Florida 2.7% 0.1% – 5.4% $7,000
Georgia 2.7% 0.06% – 8.1% $9,500
Hawaii 2.4% 2.4% – 5.6% $62,000
Idaho 1.0% 0.23% – 5.4% $55,300
Illinois 3.65% 0.75% – 7.85% $13,916
Indiana 2.5% 0.5% – 11.2% $9,500
Iowa 1.0% 0.0% – 7.0% $39,500
Kansas 1.75% 0.0% – 6.65% $14,000
Kentucky 2.7% 0.3% – 9.0% $11,700
Louisiana Varies 0.09% – 6.2% $7,700
Maine 2.41% 0.3% – 6.27% $12,000
Maryland 2.6% 0.3% – 7.5% $8,500
Massachusetts 2.13% 0.83% – 12.65% $15,000
Michigan 2.7% 0.06% – 10.3% $9,000
Minnesota Varies 0.4% – 8.9% $43,000
Mississippi 1.0% 0.0% – 5.4% $14,000
Missouri 1.0% (nonprofits) 2.376% (others) 0.0% – 6.0% $9,500
Montana Varies 0.00% – 6.12% $45,100
Nebraska 1.25% 0.0% – 5.4% $9,000 ($24,000 for max rate)
Nevada 2.95% 0.25% – 5.4% $41,800
New Hampshire 2.7% 1.00% – 7.00% $14,000
New Jersey 3.1% 0.6% – 6.4% $43,300
New Mexico 1.0% 0.33% – 5.4% $33,200
New York 4.1% 0.0% – 8.9% $12,800
North Carolina 1.0% 0.06% – 5.76% $32,600
North Dakota 1.03% (positive) 6.09% (negative) 0.08% – 9.69% $45,100
Ohio 2.7% 0.5% – 10.2% $9,000
Oklahoma 1.5% 0.3% – 9.2% $28,200
Oregon 2.4% 0.9% – 5.4% $54,300
Pennsylvania 3.822% 1.42% – 10.37% $10,000
Rhode Island 1.21% 1.1% – 9.7% $29,800 ($31,300 for negative balance)
South Carolina 0.35% or 1% 0.06% – 5.46% $14,000
South Dakota 1.2% 0.0% – 8.8% $15,000
Tennessee Varies 0.01% – 10.0% $7,000
Texas 2.7% 0.25% – 6.25% $9,000
Utah Varies 0.2% – 7.2% $48,900
Vermont 1.0% 0.4% – 5.4% $14,800
Virginia 2.5% 0.1% – 6.2% $8,000
Washington Varies 0.27% – 8.15% $72,800
West Virginia 2.7% 1.5% – 8.5% $9,500
Wisconsin 3.05% (<$500k payroll) 3.25% (>$500k payroll) 0.0% – 12.0% $14,000
Wyoming Varies 0.0% – 8.5% $32,400

See also

External links

Footnotes