Summary: Every US employer pays four payroll taxes on wages: Social Security at 6.2 percent up to the 2026 wage base of $184,500, Medicare at 1.45 percent with no cap, federal unemployment (FUTA) at 0.6 percent on the first $7,000 of each worker's wages, and state unemployment (SUTA), which varies by state. Together they add roughly 8 to 12 percent on top of wages for most workers, before benefits, workers compensation, or paid leave.
An employee's salary is only part of what they cost. Enter headcount, average wages, and your state unemployment rate to see the four payroll taxes every US employer pays in 2026, per employee and in total, with the Social Security wage base of $184,500 built in.
Total employer payroll tax (annual)
$0
| Tax | Per employee | All employees |
|---|---|---|
| Social Security 6.2% (to $184,500) | $0 | $0 |
| Medicare 1.45% (no cap) | $0 | $0 |
| FUTA 0.6% (first $7,000) | $0 | $0 |
| SUTA (your rate and base) | $0 | $0 |
Estimates only. Excludes benefits, workers compensation, paid leave, and the 0.9 percent Additional Medicare Tax (employee-paid, but employers must withhold it over $200,000).
| Tax | Employer rate | Wage base 2026 | Notes |
|---|---|---|---|
| Social Security (OASDI) | 6.2% | $184,500 | Employee pays the same 6.2% |
| Medicare (HI) | 1.45% | No cap | Employee pays 1.45%; extra 0.9% over $200,000 is employee-only |
| FUTA (federal unemployment) | 0.6% | First $7,000 per worker | Net rate after the 5.4% state credit; max $42 per worker per year |
| SUTA (state unemployment) | Varies | Varies by state | Experience-rated; new-employer rates differ by state |
Source: Social Security Administration (2026 wage base), IRS (FUTA). SUTA rates and wage bases are set by each state.
Hiring your first employee triggers four separate tax obligations, and they stack. Social Security takes 6.2 percent of wages up to $184,500 per worker in 2026. Medicare takes 1.45 percent of all wages with no cap. Federal unemployment insurance (FUTA) takes a net 0.6 percent on the first $7,000 of each worker's annual wages, which works out to a maximum of $42 per employee per year. State unemployment insurance (SUTA) takes your assigned rate on your state's wage base.
For a worker earning $65,000 with a 2.7 percent SUTA rate on a $10,000 base, the employer's 2026 payroll tax is $4,030 in Social Security, $942.50 in Medicare, $42 in FUTA, and $270 in SUTA: $5,284.50 total, or about 8.1 percent on top of wages. That percentage is remarkably stable for middle earners because the wage bases mostly stop binding once salaries pass the low five figures.
Where the math changes is at the extremes. Workers under $7,000 a year cost you FUTA on every dollar. Workers over $184,500 stop costing you Social Security on the excess, which is why the employer tax rate effectively falls for very high earners. And the 0.9 percent Additional Medicare Tax on wages over $200,000 comes entirely out of the employee's pocket, though you are the one required to withhold it.
Payroll taxes are only the mandatory slice. A realistic loaded-cost multiplier for a US employee runs 1.25 to 1.4 times salary once you add the employer's share of health insurance (often $7,000 to $15,000 per year for family coverage), retirement plan matching, workers compensation insurance (roughly 1 to 2 percent of payroll for office work, far more for construction and trades), and paid time off. A $65,000 salary typically costs $81,000 to $91,000 all in.
This matters most when you are deciding between hiring and contracting, or between your first employee and staying solo. The payroll taxes alone are the floor, not the ceiling. On the other hand, many of the add-ons scale with headcount choices you control: plan design, PTO policy, and workers comp classification are all levers.
Payroll taxes are pay-as-you-go, and the IRS is unforgiving about timing. Your deposit schedule, monthly or semiweekly, depends on your total tax liability during the lookback period. Miss a deposit and the failure-to-deposit penalty starts at 2 percent for deposits up to 5 days late, climbing to 10 percent beyond 15 days, plus interest. The trust fund recovery penalty can make owners and officers personally liable for withheld taxes the business failed to remit.
State unemployment taxes have their own quarterly filings and their own penalties, and your SUTA rate is experience-rated: layoffs raise it, stable employment lowers it. New employers get a standard new-employer rate that varies widely by state. The single best investment a new employer can make is a payroll service or software that handles deposits and filings automatically; the cost is trivial next to one penalty.
Four: Social Security at 6.2 percent up to the $184,500 wage base, Medicare at 1.45 percent with no cap, FUTA at a net 0.6 percent on the first $7,000 of each worker's wages, and state unemployment (SUTA) at your assigned rate on your state's wage base.
The 2026 Social Security wage base is $184,500, up from $176,100 in 2025. Employers pay 6.2 percent on wages up to that amount per worker; wages above it are exempt from Social Security tax but not from Medicare tax.
The net FUTA rate is 0.6 percent on the first $7,000 of each employee's annual wages, for a maximum of $42 per employee per year. The 0.6 percent is the 6.0 percent statutory rate minus the 5.4 percent credit for paying state unemployment taxes on time.
No. The 0.9 percent Additional Medicare Tax on wages over $200,000 ($250,000 joint) is paid entirely by the employee, but the employer must withhold it once wages cross the threshold.
The IRS failure-to-deposit penalty runs 2 to 10 percent depending on how late the deposit is, plus interest. Owners and responsible officers can be held personally liable for withheld employee taxes under the trust fund recovery penalty.
Figures: 2026. Sources: the Social Security Administration (2026 contribution and benefit base), the Internal Revenue Service (FUTA, deposit rules), and the US Department of Labor. This page is for planning only and is not financial, tax, or legal advice. Verify with the cited source or a qualified professional.