--- title: Unemployment Taxes for Employers description: Explore the fundamentals of unemployment benefits and how employers contribute through taxes to support them. Navigate the essentials with our breakdown. image: https://www.megapayusa.com/hubfs/Canva%20images/Canva%20Design%20DAFsj57pXCE.png --- [![Megapay](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/logo-1.svg) ![Megapay](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/logo-white.svg)](https://www.megapayusa.com/) [How We’re Different](https://www.megapayusa.com/how-we-are-different) Payroll + More ## Feature-rich software. Stress-free services. A full suite of payroll, timekeeping, and Human Resources tools and services helps your business run – and grow. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu.png) [Meet the platform.](https://www.megapayusa.com/platform) Harness the power of our cloud-based, fully integrated platform, customized to 10+ industries ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-3.svg) [Payroll](https://www.megapayusa.com/payroll) [Pay Options](https://www.megapayusa.com/payroll#payroll-pay-options) [Reporting](https://www.megapayusa.com/payroll#payroll-reporting-tracking) [Tracking](https://www.megapayusa.com/payroll#payroll-reporting-tracking) [Financing](https://www.megapayusa.com/payroll#payroll-financing) [Compliance](https://www.megapayusa.com/payroll#payroll-compliance) [Deductions](https://www.megapayusa.com/payroll#payroll-additional-services) [Workers Comp](https://www.megapayusa.com/payroll#payroll-additional-services) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-2.svg) [Timekeeping](https://www.megapayusa.com/timekeeping) [Scheduling](https://www.megapayusa.com/timekeeping#timekeeping-scheduling) [Tracking](https://www.megapayusa.com/timekeeping#timekeeping-tracking) [Compliance](https://www.megapayusa.com/timekeeping#timekeeping-compliance) [Devices](https://www.megapayusa.com/timekeeping#timekeeping-devices) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-1.svg) [Human Resources](https://www.megapayusa.com/hr) [Onboarding](https://www.megapayusa.com/hr#hr-onboarding) [Compliance](https://www.megapayusa.com/hr#hr-compliance) [Benefits](https://www.megapayusa.com/hr#hr-benefits) [Pricing](https://www.megapayusa.com/pricing) [Become a Partner](https://www.megapayusa.com/partners) Resources ## Resources for growing companies. A suite of videos, tools, and templates for you and your people. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/resources-menu-icon-2.svg) [Video Library](https://www.megapayusa.com/videos) Learn the ins and outs of the Megapay platform - and get it all done even faster. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/resources-menu-icon-3.svg) [HR Tools](https://megapayusa.portal.zywave.com/) HR videos, customizable handbook templates, onboarding & offboarding forms, and more. [Human Resources NEW](https://www.megapayusa.com/human-resources) [News](https://www.megapayusa.com/the-mega-pulse) Client Login ## Select an account to log in. Payroll [Payroll (new)](https://megapayusa.evolutionpayroll.com/hcm/#/) [Payroll (old)](https://secure.netlinksolution.com/nextgen/?firm=404480) [Payroll + HR](https://megapayusa.evolutionadvancedhr.com/Secure/Home.aspx) [For Employees](https://megapayusa.evolutionpayroll.com/ess#/login) Swipeclock [For Employers](https://megapayusa.payrollservers.us/pg/login.aspx) [For Employees](https://clock.payrollservers.us/#/clock/web/login) HR Support [HR Live Support](https://www.megapayusa.com/human-resources) [HR 360](https://www.megapayusa.com/hr) [Contact Sales](https://www.megapayusa.com/contact) [Home](https://www.megapayusa.com/) [How We’re Different](https://www.megapayusa.com/how-we-are-different) Payroll + More ## Feature-rich software. Stress-free services. A full suite of payroll, timekeeping, and Human Resources tools and services helps your business run – and grow. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-1.svg) [Payroll](https://www.megapayusa.com/payroll) [Pay Options](https://www.megapayusa.com/payroll#payroll-pay-options) [Reporting](https://www.megapayusa.com/payroll#payroll-reporting-tracking) [Tracking](https://www.megapayusa.com/payroll#payroll-reporting-tracking) [Financing](https://www.megapayusa.com/payroll#payroll-financing) [Compliance](https://www.megapayusa.com/payroll#payroll-compliance) [Deductions](https://www.megapayusa.com/payroll#payroll-additional-services) [Workers Comp](https://www.megapayusa.com/payroll#payroll-additional-services) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-2.svg) [Timekeeping](https://www.megapayusa.com/timekeeping) [Scheduling](https://www.megapayusa.com/timekeeping#timekeeping-scheduling) [Tracking](https://www.megapayusa.com/timekeeping#timekeeping-tracking) [Compliance](https://www.megapayusa.com/timekeeping#timekeeping-compliance) [Devices](https://www.megapayusa.com/timekeeping#timekeeping-devices) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu-icon-3.svg) [Human Resources](https://www.megapayusa.com/hr) [Onboarding](https://www.megapayusa.com/hr#hr-onboarding) [Compliance](https://www.megapayusa.com/hr#hr-compliance) [Benefits](https://www.megapayusa.com/hr#hr-benefits) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/service-menu.png) [Meet the platform.](https://www.megapayusa.com/platform) Harness the power of our cloud-based, fully integrated platform, customized to 10+ industries [Pricing](https://www.megapayusa.com/pricing) [Become a Partner](https://www.megapayusa.com/partners) Resources ## Resources for growing companies. A suite of videos, tools, and templates for you and your people. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/resources-menu-icon-2.svg) [Video Library](https://www.megapayusa.com/videos) Learn the ins and outs of the Megapay platform - and get it all done even faster. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/resources-menu-icon-3.svg) [HR Tools](https://megapayusa.portal.zywave.com/) HR videos, customizable handbook templates, onboarding & offboarding forms, and more. [Human Resources NEW](https://www.megapayusa.com/human-resources) [news](https://www.megapayusa.com/the-mega-pulse) client login ## Select an account to log in. Payroll [Payroll (new)](https://megapayusa.evolutionpayroll.com/hcm/#/) [Payroll (old)](https://secure.netlinksolution.com/nextgen/?firm=404480) [Payroll + HR](https://megapayusa.evolutionadvancedhr.com/Secure/Home.aspx) [For Employees](https://megapayusa.evolutionpayroll.com/ess#/login) Swipeclock [For Employers](https://megapayusa.payrollservers.us/pg/login.aspx) [For Employees](https://clock.payrollservers.us/#/clock/web/login) HR Support [HR Live Support](https://www.megapayusa.com/human-resources) [HR 360](https://www.megapayusa.com/hr) [contact sales](https://www.megapayusa.com/contact) [![Megapay](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/logo-footer.svg)](https://www.megapayusa.com/) Payroll, personally™ Megapay is an all-in-one customizable payroll, timekeeping and HR software that offers built-in support from dedicated personal payroll experts. About Megapay [Home](https://www.megapayusa.com/) [How We're Different](https://www.megapayusa.com/how-we-are-different) [For Partners](https://www.megapayusa.com/partners) [Pricing](https://www.megapayusa.com/pricing) [Contact](https://www.megapayusa.com/contact) Explore Platform [Payroll](https://www.megapayusa.com/payroll) [Timekeeping](https://www.megapayusa.com/timekeeping) [Human Resources](https://www.megapayusa.com/hr) [Premium HR Tools](https://www.megapayusa.com/hr360) Resources [HR 360](https://www.megapayusa.com/hr360) Contact us [Call us! 855 634 2729](tel:8556342729) [hello@megapayusa.com](mailto:hello@megapayusa.com) [25 Robert Pitt Dr | Ste #218 Monsey, NY 10952](https://goo.gl/maps/whjTESbpgrTTxLNL6) Follow us Copyright Megapay Inc. All Rights Reserved. [< Return to the blog](https://www.megapayusa.com/blog/all) ![](https://www.megapayusa.com/hubfs/Canva%20images/Canva%20Design%20DAFsj57pXCE.png) [Law](https://www.megapayusa.com/blog/tag/law) [Federal](https://www.megapayusa.com/blog/tag/federal) [Payroll & Tax](https://www.megapayusa.com/blog/tag/payroll-tax) [State](https://www.megapayusa.com/blog/tag/state) # Unemployment Taxes for Employers When it comes to unemployment benefits and the taxes that fund them, employers have a key role to play. In this post, we’ll break down the basics of what unemployment taxes are and how as an employer, you are responsible for paying them. ## The Federal Unemployment Tax The United States has a federal law called [FUTA (Federal Unemployment Tax Act)](https://www.investopedia.com/terms/f/federal-unemployment-tax-act-futa.asp) that requires employers to contribute to the federal unemployment insurance program. FUTA’s goal is to provide temporary financial assistance to workers who have lost their jobs and are actively seeking new employment. As an employer, you are required to pay a tax on the wages you pay to your employers that will be applied toward unemployment benefits. This is done through payroll. Currently, the federal unemployment tax rate is a standard rate of [6% for the first $7,000 of your employee’s wages](https://www.paylocity.com/resources/tax-resources/futa-tax/#:~:text=The%202023%20FUTA%20tax%20rate,(6.0%25%20x%20%247%2C000).).  With that said, you can receive a credit for your federal tax rate if you pay your state unemployment taxes. This may bring your federal rate to 0.6%. ## New York State's Unemployment Tax The rate of unemployment taxes for employers varies state by state and will always be paid to the state where the employee works in. In most cases, states require separate registration based on the state your employees work in. In New York State, the NY Department of Labor has an unemployment insurance program (UI). This means that employers in New York are required to pay unemployment insurance taxes to contibute to this program. Here are a few things to remember: - When you begin to hire employers, register with the NYSDOL [using this form](https://dol.ny.gov/system/files/documents/2021/02/nys100.pdf). You will then receive your [Employer Registration Number](https://www.freshbooks.com/en-gb/hub/other/what-is-an-ern) (ERN). - At this point, your unemployment insurance tax rate will be calculated - Your tax rate is determined based on your industry, number of employees, and your history of layoffs and unemployment claims (read below for more info). The [the new employer rate is 3.4%](https://dol.ny.gov/unemployment-insurance-rate-information), but rates in general range from 2.1% - 9.9%. - You are required to report your quarterly wages and pay unemployment insurance using your ERN - If any claims are submitted by former employees, you are required to respond promptly. ## So, How Does It Work? The rate of unemployment taxes for employers varies state by state and will always be paid to the state where the employee works. In most cases, states require separate registration based on where your employees work. For every payroll in NY State, the unemployment tax will be paid by the employer and put into New York’s Unemployment Insurance Trust Fund. This is where the funds will be held and used to pay unemployment benefits to qualified unemployed persons. The amount of benefits someone receives is based on their previous earnings and state laws. What makes someone [eligible for unemployment](https://www.ny.gov/services/get-unemployment-assistance) in New York State? - They’ve worked in New York for the past 18 months - They’ve lost their job due to no fault of their own: - Reduced work force or company has downsized, restructured, or shut down - Job was eliminated or there was lack of work - Seasonal/temporary contract has ended - Unable to meet the qualifications of the job - Out of work due to uncontrollable circumstances ## Common Questions - Clarified The amount you pay per employee each year is capped. In 2023, for New York State, the capped amount per employee is $12,300. [Check your state’s limit here.](https://taxnews.ey.com/news/2022-1913-a-preliminary-look-at-the-2023-sui-taxable-wage-bases-as-of-december-19-2022) Your rate can increase if you have a lot of turnover, causing previous staff to file for unemployment. If you do not agree with an approved claim, you can fight it by asking for a hearing. This can be done by both a former employee and/or employer [using this form](https://dol.ny.gov/system/files/documents/2021/02/lo436.pdf). Check out more [Frequently Asked Questions](https://dol.ny.gov/you-apply-unemployment-frequently-asked-questions) here. Related articles [Browse all articles](https://www.megapayusa.com/blog/all) [Federal](https://www.megapayusa.com/blog/tag/federal) [Payroll & Tax](https://www.megapayusa.com/blog/tag/payroll-tax) [HR](https://www.megapayusa.com/blog/tag/hr) ### Can I Hire an Employee Without a Social Security Number? Simply put, no. A person needs a Social... [Read more](https://www.megapayusa.com/blog/hire-employee-without-social-security-number) [Timekeeping](https://www.megapayusa.com/blog/tag/timekeeping) [State](https://www.megapayusa.com/blog/tag/state) ### New York’s Spread of Hours: What Employers Need to Know When managing a business in New York,... [Read more](https://www.megapayusa.com/blog/spread-of-hours) [Federal](https://www.megapayusa.com/blog/tag/federal) [Payroll & Tax](https://www.megapayusa.com/blog/tag/payroll-tax) [State](https://www.megapayusa.com/blog/tag/state) ### Get Tax Credits for Helping Employees With Childcare We recently recorded a conversation... [Read more](https://www.megapayusa.com/blog/get-tax-credits-for-helping-employees-with-childcare) [Browse all articles](https://www.megapayusa.com/blog) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/line-blue.svg) ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/line-purple-2.svg) Sign up for Emails ## Get important payroll updates – written in plain English. Sign up [![Megapay](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/logo-footer.svg)](https://www.megapayusa.com/) Payroll, personally™ Megapay is an all-in-one customizable payroll, timekeeping and HR software that offers built-in support from dedicated personal payroll experts. About Megapay [Home](https://www.megapayusa.com/) [How We're Different](https://www.megapayusa.com/how-we-are-different) [For Partners](https://www.megapayusa.com/partners) [Pricing](https://www.megapayusa.com/pricing) [Contact](https://www.megapayusa.com/contact) Explore Platform [Payroll](https://www.megapayusa.com/payroll) [Timekeeping](https://www.megapayusa.com/timekeeping) [Human Resources](https://www.megapayusa.com/hr) [Premium HR Tools](https://www.megapayusa.com/hr360) Resources HR 360 [Video Library](https://www.megapayusa.com/videos) [HR Tools](https://megapayusa.portal.zywave.com/Landing) [Labor Law Posters](https://www.megapayusa.com/blog/labor-law-posters-for-every-state) Contact us [Call us! 855 634 2729](tel:8556342729) [hello@megapayusa.com](mailto:hello@megapayusa.com) [33 Downtown Dr | Ste #420 Monsey, NY 10952](https://maps.app.goo.gl/wSnPfKMZSE52vtBD8) Follow us Copyright Megapay Inc. All Rights Reserved. Website content provided is for informational purposes only and is not legal or professional advice. Each situation is unique; please consult a qualified professional for guidance specific to your case. We are here to answer your questions and help you with any of your payroll processing, time-keeping, and HR compliance needs. ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/pop-btn-icon-1.svg)Payroll ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/pop-btn-icon-2.svg)HR ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/pop-btn-icon-3.svg)Timekeeping ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/pop-btn-icon-4.svg)Benefits ![](https://www.megapayusa.com/hubfs/raw_assets/public/Megapay/images/pop-btn-icon-5.svg)Onboarding Download our Chrome Extension! Make your Megapay online experience more simple and seamless than ever with our free Chrome extension. [Download here](https://chromewebstore.google.com/detail/megapay-usa/ggbbnmhpldgcccpchkjcmpcbjalnhegg?authuser=0&hl=en&pli=1) ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Megapay", "url" : "https://www.megapayusa.com/blog/author/megapay" }, "dateModified" : "2023-11-16T20:28:59.103Z", "datePublished" : "2023-08-25T15:15:16.000Z", "headline" : "Unemployment Taxes for Employers", "image" : [ "https://www.megapayusa.com/hubfs/Canva%20images/Canva%20Design%20DAFsj57pXCE.png" ], "mainEntityOfPage" : { "@id" : "https://www.megapayusa.com/blog/unemployment-taxes", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://www.megapayusa.com/hubfs/Logo%20Full%20Color@8x-1.png" }, "name" : "MegaPay USA" } } ```