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2021 SUTA Taxes: Here’s What You Need to Know

With tax season in full swing, ensuring your company meets government standards in an ever-changing compliance landscape can be tough. When it comes to state taxes, specifically the State Unemployment Tax Act (SUTA), it’s important to know how the tax is calculated, stay aware of current rates and more. For example, did you know having employees in multiple states could mean different SUTA rates? The right payroll partner can help you navigate the ins and outs of SUTA to help you stay compliant.

What is SUTA?

The State Unemployment Tax Act (SUTA), also known as State Unemployment Insurance (SUI), is a payroll tax required of employers. Once paid, these taxes are placed into each state’s unemployment fund and used by employees who have separated from their place of employment. Companies that neglect to pay SUTA or SUI taxes may be subject to fines and penalty fees. In severe cases, criminal penalties can be brought against employers.

Unlike FUTA taxes, which are paid only by the employer, some states require additional money be withheld from employee wages for state unemployment taxes. States consider several factors in calculating SUTA rates, including the number of former employees who’ve filed unemployment claims, account status, the age of your business and the turnover rate for the industry in which you operate.

Your company will pay SUTA taxes to the state where the work takes place. The wage base and limits for SUTA taxes differ from state to state. If all of your employees work in the state in which the business is located, then that’s where SUTA taxes will be paid. But if there are employees working in different states, then SUTA tax payments will need to be made to each individual state. Be aware that your SUTA rate can change from year to year based on evaluation by the state. You should receive a SUTA Rate Notice, which provides a breakdown of how rates are determined.

Where can I find the updated 2021 SUTA rate for my state?

This chart outlines the 2021 SUTA employer tax rate ranges. Some states are still finalizing their 2021 tax information, so these tax ranges have been left blank. For complete SUTA tax rate information, visit your state’s government website.

State 2021 Employer Tax Rate Range
Alabama 0.65% – 6.8%
Alaska 1.5% – 5.9%
Arizona 0.08% – 20.6%
Arkansas 0.30% – 14.2%
California 1.5% – 6.2%
Colorado 0.71% – 9.64%
Connecticut 1.9% – 6.8%
Delaware 0.3% – 8.2%
D.C. The higher of 2.7% or the average rate of all employer contributions in the preceding year
Florida 0.29% – 5.4%
Georgia 0.04% – 7.56%
Hawaii 0.01% – 6.6%
Idaho 0.207% – 5.4%
Illinois 0.2% – 6.4%
Indiana 0.5% – 7.4%
Iowa 0.0% – 7.5%
Kansas 0.2% – 7.6%
Kentucky 1.0% – 10%
Louisiana 0.09% – 6.2%
Maine 0.69% – 6.01%
Maryland 2.2% – 13.5%
Massachusetts Not yet available
Michigan 6.8% – 8.1%
Minnesota 0.1% – 0.5%
Mississippi 0.0% – 5.4%
Missouri 0.0% – 6.0%
Montana 0.0% – 6.12%
Nebraska 0% – 5.4%
Nevada 0.25% – 5.4%
New Hampshire Not yet available
New Jersey 0.4% – 5.4%
New Mexico 0.33% – 5.4%
New York 0.6% – 7.9%
North Carolina 0.06% – 5.76%
North Dakota 0.08% – 9.69%
Ohio 0.3% – 9.3%
Oklahoma 0.3% – 7.5%
Oregon 1.2% – 5.4%
Pennsylvania 1.29% – 9.93%
Rhode Island 1.2% – 9.8%
South Carolina 0.06% – 5.46%
South Dakota 0% – 9.5%
Tennessee 0.01% – 10%
Texas Not yet available
Utah 0.2% – 7.2%
Vermont 0.4% – 5.4%
Virginia 0.1% – 6.2%
Washington 0.0% – 6.86%
West Virginia Not yet available
Wisconsin 0% – 12%
Wyoming 0.48% – 9.78%

Please note the above rates are subject to change. Visit your state’s official website for finalized SUTA information.

Paycom can help alleviate the stress of tax season by making your payroll tax management process simple. To learn more about how we can help remove the headache of managing state and local tax laws and help you stay compliant, schedule a demo today.

The information provided herein does not constitute the provision of legal advice, tax advice, accounting services or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional legal, tax, accounting or other professional advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation and for your particular state(s) of operation.