Payroll Tax Calculator

Calculate employer and employee payroll tax obligations including Social Security, Medicare, and FUTA for 2024.

Employee Information

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Assumes same wages for all employees

Enter employee wages and headcount, then click Calculate to see payroll tax obligations.

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Pro Tip

The true cost of an employee is 7-12% above their gross salary when you factor in employer-paid payroll taxes, unemployment insurance, and workers' compensation.

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Understanding Payroll Taxes

Payroll taxes are shared between employers and employees to fund Social Security and Medicare programs. Employers have additional obligations including FUTA (Federal Unemployment Tax Act) and matching FICA contributions.

Social Security tax is 6.2% for both the employer and employee, applied to wages up to the annual wage base of $168,600 for 2024. Once an employee's earnings exceed this cap, no further Social Security tax is withheld.

Medicare tax is 1.45% for both employer and employee on all wages with no cap. Employees earning over $200,000 pay an additional 0.9% Medicare surcharge, but employers do not match this extra amount.

FUTA funds the federal unemployment insurance system. The base rate is 6.0% on the first $7,000 of each employee's wages, but employers in states that have met federal requirements receive a 5.4% credit, reducing the effective rate to 0.6%.

Employer Payroll Tax Formulas

Total Employer Cost = Wages + Employer SS + Employer Medicare + FUTA

Where:

Employer SS = 6.2% of wages up to $168,600

Employer Medicare = 1.45% of all wages (no cap)

FUTA = 0.6% of first $7,000 per employee (after state credit)

Example

One employee earning $65,000 annually:

  • • Employer SS = $65,000 x 6.2% = $4,030
  • • Employer Medicare = $65,000 x 1.45% = $942.50
  • • FUTA = $7,000 x 0.6% = $42.00
  • • Total employer cost = $65,000 + $4,030 + $942.50 + $42 = $70,014.50

Frequently Asked Questions

What is the Social Security wage base for 2024?
The 2024 Social Security wage base is $168,600. Both employer and employee pay 6.2% on wages up to this amount. Wages above this threshold are not subject to Social Security tax.
Who pays the additional Medicare tax?
Only employees pay the additional 0.9% Medicare tax on wages exceeding $200,000 ($250,000 for married filing jointly). Employers do not match this additional amount.
What is FUTA and how much does it cost?
FUTA (Federal Unemployment Tax Act) is paid only by employers at a base rate of 6.0% on the first $7,000 of each employee's wages. Most employers receive a 5.4% state credit, reducing the effective rate to 0.6%, or a maximum of $42 per employee per year.
Are payroll taxes different from income taxes?
Yes. Payroll taxes (FICA) specifically fund Social Security and Medicare. They are separate from federal and state income taxes, which fund general government operations. Payroll taxes are split between employer and employee, while income taxes are the employee's responsibility.
Does the employer pay more than just matching FICA?
Yes. Beyond matching Social Security and Medicare, employers pay FUTA, and in most states, they also pay State Unemployment Tax (SUTA), workers' compensation insurance, and sometimes local taxes. The true cost of an employee is typically 7-12% more than their gross wages.