How to Set up SUTA and FUTA

Halfpricesoft.com Online Payroll System can handle both employer side and employee side taxes. This is the guide about how to set up the federal unemployment tax(FUTA) and the state unemployment tax(SUTA).

1. View Company Tax Setup


company tax setup

2. FUTA


FUTA (Federal Unemployment Tax) is Employer-side tax only and will not be printed on paycheck stubs

The default tax rate for 2018 is 6%. However, many companies can take up to 5.4% credit. Please check with your local IRS office to see what rate you should use.

For example:
- If your FUTA rate is 0.06 (6%), please enter 6 there.
- If your FUTA rate is 0.006 (0.6%), please enter 0.6 there

The FUTA tax applies to the first $7,000 you paid to each employee as wages during the year.

If you set up the wrong FUTA rate for some paychecks, you still have chance to correct it when you file Form 940.

3. SUTA


SUTA (State Unemployment Tax) is Employer-side tax only and will not be printed on paycheck stubs

Usually your state goverment will mail you the new SUTA rate each year. If you are not sure about your rate, you can contact your state office.

Ralated Links

  • How to add a customized deduction and withhold it from each paycheck automatically

  • How to handle local tax

  • How to handle FUTA and SUTA

  • How to add and print a paycheck

  • How to change the pay peroid



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