Since the SUTA rates changes are made at the end of each year and there is much discussion about changes to the FUTA rate, the available 2017 rates were used for FUTA and SUTA.

Note: For this textbook edition the rate 0.6% was used for the FUTA tax rate for employers.

Example 5-8

The Iqbal Company of Georgia had a FUTA taxable payroll of $215,600 and a SUTA taxable payroll of $255,700 with a 5.6 percent SUTA tax rate. The company would pay unemployment taxes of:

FUTA $215,600 0.006	=	$1,293.60
SUTA $255,700 0.056	=	14,319.20
Total taxes		$15,612.80

Kresloff Company has only two employees and is located in a state that has set an unemployment tax for the company of 4.8 percent on the first $12,000 of each employees earnings. Both employees are paid the same amount each week ($900) and have earned $11,500 up to this weeks pay. The unemployment taxes that the company must pay for this weeks pay would be $48. FUTA tax (both over $7,000) = $0.00 SUTA tax ($1,000 0.048) = $48.00 ($500 of each employees pay is under the state taxable limit of $12,000)

During 2018, Shoupe Company was subject to the New Jersey state unemployment tax of 5.1%. The company's taxable wages for FUTA were $93,400 and for SUTA, $194,300. Compute the following; round your answers to the nearest cent.

a. SUTA tax that Shoupe Company would pay to the state of New Jersey $

b. Net FUTA tax for 2018 $

c. Amount of employees' unemployment tax for 2018 (use the employee's tax rate shown in Figure 5.1.) $

Feedback

a. SUTA Taxable payroll times net SUTA rate b. FUTA Taxable payroll times FUTA rate c. SUTA taxable wages times employee's rate (use Figure 5-1)

FIGURE 5.1 Summary of State Unemployment Compensation Laws (2017) Warning: The provisions of the state laws are subject to change at any time.

State	Size of Firm (One employee in specified time and/or size of payroll1)	Contributions (On first $7,000 unless otherwise indicated)		Benefits (Excluding dependency allowances)
		Employer Min.-Max.	Employee	Waiting Period (weeks)	Max. per Week	Min. per Week	Max. Duration (weeks)
ALABAMA	20 weeks	0.65%6.8% on first $8,000		none	$265	$45	26
ALASKA	any time	1.0%5.4% on first $39,800	0.5% on first $39,800	1	370	56	26
ARIZONA	20 weeks	0.04%10.59%**		1	240	60	26
ARKANSAS	10 days	0.4%14.3% on first $12,000**		1	451	81	26
CALIFORNIA*	over $100 in any calendar quarter	1.5%6.2%	0.9% on first $110,902 (disability ins)	1	450	40	25
COLORADO	any time	0.77%10.10% on first $12,500**		1	568	25	26
CONNECTICUT	20 weeks	1.9%6.8% on first $15,000		none	616	15	26
DELAWARE	20 weeks	0.3%8.2% on first $18,500		none	330	20	26
DISTRICT OF COLUMBIA	any time	1.6%7.0% on first $9,000		1	425	50	26
FLORIDA	20 weeks	0.1%5.4%		1	275	32	23
GEORGIA	20 weeks	0.04%8.10% on first $9,500**		none	330	44	26
HAWAII	any time	0.0%5.6% on first $44,000	0.5% of maximum weekly wages of $1,023.31 not to exceed $5.12 per week (disability ins)	1	569	5	26
IDAHO	20 weeks or $300 in any calendar quarter	0.399%5.4% on first $37,800		1	410	72	26
ILLINOIS	20 weeks	0.55%7.35% on first $12,960		1	449	51	25
INDIANA	20 weeks	0.5%7.4% on first $9,500**		1	390	50	26
IOWA	20 weeks	0.0%8.0% on first $29,300		none	447	64	26
KANSAS	20 weeks	0.2%7.6% on first $14,000**		1	474	117	26
KENTUCKY	20 weeks	0.6%9.75% on first $10,200**		none	415	39	26
LOUISIANA	20 weeks	0.10%6.2% on first $7,700**		1	247	10	26
MAINE	20 weeks	0.55%5.46% on first $12,000**		1	410	71	26
MARYLAND	any time	0.3%7.5% on first $8,500		none	430	25	26
MASSACHUSETTS	13 weeks	0.73%11.13% on first $15,000**		1	742	31	30
MICHIGAN	20 weeks or $1,000 in calendar year	0.06%10.3% on first $9,000**		none	362	81	20
MINNESOTA	20 weeks	0.2%9.1% on first $32,000**		1	683	38	26
MISSISSIPPI	20 weeks	0.2%5.6% on first $14,000		1	235	30	26
MISSOURI	20 weeks	0.0%6.0% on first $13,000**		1	320	48	26
MONTANA	Over $1,000 in current or preceding year	0.13%6.3% on first $31,400		1	487	139	28
NEBRASKA	20 weeks	0.0%5.4% on first $9,000**		1	392	30	26
NEVADA	$225 in any quarter	0.25%5.4% on first $29,500		none	426	16	26
NEW HAMPSHIRE	20 weeks	0.1%7.0% on first $14,000		none	427	32	20
NEW JERSEY	$1,000 in any year	0.5%5.8% on first $33,500**	0.765% (0.24% for disability ins; 0.525% for unempl. comp/family leave/workforce development funds) on first $33,500	1	677	73	26
NEW MEXICO	20 weeks or $450 in any quarter	0.33%5.4% on first $24,300**		1	425	79	26
NEW YORK	$300 in any quarter	1.3%9.1% on first $10,900**	0.5%limit $0.60 weekly	1	430	100	26
NORTH CAROLINA	20 weeks	0.06%5.76% on first $23,100**		1	350	46	26
NORTH DAKOTA	20 weeks	0.49%11.43% on first $35,100**		1	633	43	26
OHIO	20 weeks	0.3%8.8% on first $9,000**		1	435	111	26
OKLAHOMA		0.1%5.5% on first $17,700		1	505	16	26
OREGON	20 weeks	1.2%5.4% on first $38,400		1	590	138	26
PENNSYLVANIA	18 weeks or $225 in any quarter	2.6434%11.2616% on first $9,750**	0.07% on total wages	1	573	35	26
PUERTO RICO	any time	2.2%5.4%	0.3% on first $9,000 (disability ins)	1	133	7	26
RHODE ISLAND	any time	1.2%9.80% on first $22,400**	1.2% on first $68,100 (disability ins)	1	566	43	26
SOUTH CAROLINA	any time	0.06%5.46% on first $14,000		1	326	42	26
SOUTH DAKOTA	20 weeks	0.0%10.03% on first $15,000**		1	345	28	26
TENNESSEE	20 weeks	0.01%10.0% on first $8,000		1	275	30	26
TEXAS	20 weeks	0.59%8.21% on first $9,000**		1	493	66	26
UTAH	$140 in calendar quarter in current or preceding calendar year	0.2%7.2% on first $33,100		1	509	25	26
VERMONT	20 weeks	1.3%8.4% on first $17,300		1	458	59	26
VIRGIN ISLANDS*	any time	1.5%6.0% on first $23,500		1	495	33	26
VIRGINIA	20 weeks	0.13%6.23% on first $8,000		1	378	60	26
WASHINGTON	any time	0.13%5.72% on first $45,000**		1	681	158	26
WEST VIRGINIA	20 weeks	1.5%8.5% on first $12,000**		1	424	24	26
WISCONSIN	20 weeks	0.0%12.0% on first $14,000**		none	370	54	26
WYOMING	$500 in current or preceding calendar year	0.34%8.84% on first $25,400		1	489	34	26

¹This is $1,500 in any calendar quarter in current or preceding calendar year unless otherwise specified. *2016 FUTA credit reduction state **Allow voluntary contributions