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State Unemployment Tax Rate for 2009, 2010


State unemployment tax is a tax that employers pay. The payroll tax usually refers to two different kinds of taxes. Employers are required to withhold these taxes from their employees’ pay. This is also called withholding. The two types are pay as you earn (PAYE) or pay as you go (PAYG) tax. The employer can pay directly from their own funds which are directly related to employing a worker. This can be a fixed amount or proportional to an employee’s pay.

State and Federal Unemployment Taxes

Each employer must pay State and Federal Unemployment taxes (SUTA and FUTA). The federal unemployment rate is equal to 6.2% of gross compensation, but normally nets to 0.8% because the employer is allowed to take a credit up to 5.4% of compensation for State unemployment taxes paid by the employer. This is true if the employer is eligible for the maximum credit.

State Unemployment Tax Rate

Each state has a different rate. Employers are going to have to consult their state for the requirements for their particular state regarding tax rates and maximum wage base. A new business will be required by many states to have an average starting rate until an employment history is created and established.

Where to Find More Information

You can go directly to the IRS and look up state information. This will actually take you away from the IRS site and open up a map of the United States. You simply click on your state and then research your states website. If this sounds like a lot of work then, I don’t blame you. Who has the time?

Another Option

You can save yourself a lot of time and maybe some costly mistakes by letting the tax experts handle the important tax matters. Turbo Tax Online can help you with your federal tax return and your state tax return.

They can certainly help you as a business owner and most likely find deductions you deserve to claim which you were unaware of. You are guaranteed the biggest refund possible. The software displays your refund (or tax owed) on every screen and updates the amount, as you answer questions.


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