What are FUTA taxes?

Last modified 9/19/2024 8:27:25 AM EST

The Federal Unemployment Tax Act(FUTA) is a federal law that imposes taxes on businesses with employees. The FUTA tax rate is 6% of the first $7,000 paid to each employee annually. Employers are responsible for paying these taxes to the IRS. The main purpose of the FUTA tax is to help the unemployed during high unemployment or those who are fired without their fault.