August 8, 2011

Expiration of FUTA Surcharge Tax

The federal unemployment tax (FUTA) empowers the IRS to tax employers in all states to fund unemployment benefits for involuntarily terminated workers.  For the past 23 years, FUTA included a 0.2% surcharge. This additional 0.2% surcharge provision expired on June 30, 2011.  Therefore, unless extended by law, the FUTA rate has decreased from 6.2% to 6.0% of gross payroll, beginning July 1, 2011.


The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations.

As required by U.S. Treasury rules, we inform you that, unless expressly stated otherwise, any U.S. federal tax advice contained in this Benefit Beat is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service.