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FUTA and SUTA taxes
| The partnership of Cox and Cohen paid the following wages during this year:
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In addition, the partnership owed $200 to Chu for work he performed during December. However, payment for this work will not be made until January of the following year. The state unemployment tax rate for the company is 2.95% on the first $9,000 of each employee’s earnings. Compute: a) Net FUTA tax for the partnership for this year b) SUTA tax for this year |
Expert Answer
Solution:
SUTA Tax
Employee earn per year = 9,000
SUTA Rate = 2.95%
Caluculation:
9,000 * 0.0295
= 265.5
Each employes suta is 265.5
8 Employee SUTA is 265.5 * 8
= 2,124
OR
7,000 * 0.0295
206.5
206.5 * 8
=1,652
Caluculation of FUTA Tax:
Employee Earn per year = 9,000
Rate = 0.295
= 9,000 * 0.0295
=265.5
Owed money for both SUTA and FUTA
265.5 – 200
=65.5
Remianing 7 Employees 265.5 * 7
1,858.5 + 65.5
=1,924
OR
= 65.5 * 8
= 524
