Employer payroll tax calculator

Hiring someone costs more than the salary. As the employer you pay your own share of Social Security and Medicare, plus federal and state unemployment taxes.

Enter the yearly wages to see each tax and the full cost per employee.

How it's calculated

Social Security: 6.2% of wages up to $184,500.
Medicare: 1.45% of all wages. Unlike employees, employers never pay the Additional Medicare Tax.
FUTA: 6% of the first $7,000 of each employee's wages, minus a credit of up to 5.4% for paying state unemployment tax. Most employers pay a net 0.6%.
SUTA: the rate your state assigns you, on wages up to your state's wage base.

An example

An employee paid $50,000 a year costs $53,867: $3,100 of Social Security, $725 of Medicare and $42 of FUTA, before state unemployment tax.

Frequently asked questions

How much does an employee cost on top of salary?

Federal payroll taxes add about 7.7% for most salaries. State unemployment tax, benefits and workers' compensation usually push the total higher.

What is my SUTA rate?

Each state sets it every year based on your industry and how many former employees claimed unemployment. New employers get a standard starting rate from the state.

Do I pay these taxes for contractors?

No. Independent contractors who get a 1099 pay their own self-employment tax. Classify workers carefully, because the IRS and the Department of Labor look at how the work is controlled, not at the contract's title.

Key terms

FUTA: The Federal Unemployment Tax Act tax, paid only by employers.
SUTA: State unemployment tax. The rate and wage base change by state and by employer.