2022 futa tax rates and limits

Employers are liable for unemployment tax in Virginia if they are currently liable for Federal Unemployment Tax. Once an employer is eligible to receive a reduced tax rate, the tax rate is determined annually based on experience. The FUTA tax rate for 2022 and 2023 is 6%. The 2022 Employee rate is 0.56%. Absent this legislation, and due to the continuing effect on the state's UI trust fund of the COVID-19 pandemic, the SUI wage base could have increased to $11,000 or $12,000 for 2022. Maintaining 2020 annual taxable wage base limits. Paying taxes, including federal income tax, social security tax, and Medicare tax, is an obligation youll need to fulfill again and again often on a monthly, quarterly, and yearly basis. However, don't include any wages paid by the predecessor employer on your Form 940 unless you're a successor employer. It was raised to 62.5 for the remainder . 759 Form 940 Employer's Annual Federal Unemployment (FUTA) Tax Return Filing and Deposit Requirements, You paid wages of $1,500 or more to employees in any calendar quarter during 2021 or 2022, or. Average Quarterly. Virgin Islands is yet to repay its loan balance, so employers in this jurisdiction are potentially subject to a reduction in FUTA. This $7,000 is known as the taxable wage base. Heres a breakdown of how to calculate your quarterly FUTA liability in this scenario: As mentioned before, the IRS allows you to carry over your FUTA payment to the next quarter if your FUTA tax is $500 or less. However, FUTA and SUTA tax rates and wage base amounts may not be the same. What is the 2022-2023 FUTA Tax Rate? IRS Updates: The IRS has made some changes to Form 940 for 2022 Tax Year. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. , with a taxable wage base of $7,000 (per employee) or taxable wages up to $7,000. As a result, many states currently have outstanding loans to the government that will result in higher FUTA taxes being paid by employers in those states in 2023. But if you paid an employee $6,000, you pay 6.0% of $6,000 in FUTA. This is because marginal tax rates only apply to income that falls within that specific bracket. It's a payroll tax that many states impose on employers in order to fund state unemployment insurance and other employment programs. (U.S. Department of Labor, Comparison of State Unemployment Laws, 2020, state law information webpage; email response to inquiry. The 2021 rates are effective Jan. 1, and remain in effect through 2021 unless Congress passes new tax legislation. If you won't be liable for filing Form 940 in the future, see "Final: Business closed or stopped paying wages" under Type of Return in the Instructions for Form 940PDF. According to the example above, your business pays the $105.60 in FUTA taxes on January 31 of the following year since you did not collect $500 during the year. Additionally, positive-rated employers and . In addition to state unemployment tax, the Federal Unemployment Tax Act (FUTA). 760, Reporting and Deposit Requirements for Agricultural Employers. Employee 3 has $37,100 in eligible FUTA wages, but FUTA applies only to the first $7,000 of each . Supports 940-PR, and 940 Schedule R. Multiple Options to Pay Balance Due. Once your FUTA tax liability for a quarter (including any FUTA tax carried forward from an earlier quarter), is more than $500, you must deposit the tax by electronic funds transfer using the Electronic Federal Tax Payment System (EFTPS). So, in the example above, you wouldnt need to make a FUTA deposit yet. 4 January 31, 2022 January 31, 2022 February 28, 2022 Paychex 2021 Tax Bulletin SUI or FUTA Exempt Employees If you had employees who were exempt for state unemployment insurance (SUI) or federal Most other business types do not subject owners pay to FUTA tax, making owners ineligible to receive unemployment benefits. States include the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. . As a result of 2021 legislation (HB 1409/Act 368), the SUI taxable wage base for calendar year 2022 will remain $10,000, the same as it was in 2021. In brief, the unemployment tax system works as follows: Employers pay into the system, based on a percentage of total employee wages. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein. Understanding Homeowners Insurance Premiums, Guide to Homeowners Insurance Deductibles, Best Pet Insurance for Pre-existing Conditions, What to Look for in a Pet Insurance Company, Marcus by Goldman Sachs Personal Loans Review, The Best Way to Get a Loan With Zero Credit. For rates of 1.0% or greater, multiply the rate by 1.667. For 2022, as in 2021, unemployment tax rates for experienced employers are to be determined with Schedule F+ and are to range from 1.5% to 6.2%. You pay unemployment tax on the first $9,000 that each employee earns during the calendar year. The maximum FUTA tax credit is 5.4%. 6.2% Social Security tax on the first $160,200 of employee wages (maximum tax is $9,932.40; i.e., 6.20% $160,200), plus; The 5.4% tax credit is reduced if the businesss state or territory fails to repay the federal government for money borrowed to pay unemployment benefits. Sometimes states need to borrow money from the federal government to pay unemployment benefits. Taxpayers can qualify for the foreign earned income exclusion of $112,000 for tax year 2022. Also, this tax can be offset by SUTA tax payments . Legislation from 2017 grants the territory's Secretary of Labor the discretion to increase the taxable wage base to as much as $10,500 if deemed necessary. The standard FUTA tax rate is 6.0% on the first $7,000 of taxable wages per employee, which means that the maximum tax that you as an employer have to pay per employee for the 2022 tax year is: $7,000 x 6% = $420 . Minnesota. For Quarter 2 (April to June), the FUTA Tax Payment is due by July 31. In some states, wages paid to corporate officers or payments for fringe benefits may not be subject to SUTA tax, but may be subject to FUTA. The FUTA tax rate protection for 2021 is 6% as per the IRS standards. As a result, most states reduced the taxable wage base last year. Wage limit . Generally, you're entitled to the maximum credit if you paid your state unemployment taxes in full, by the due date of the Form 940, and the state isn't determined to be a credit reduction state. Starting Jan. 1, 2023, the maximum earnings subject to the Social Security payroll tax will increase by nearly 9 percent to $160,200up from the $147,000 maximum for 2022, the Social Security . Copyright, Trademark and Patent Information, Youve paid employees $1,500 or more in any quarter of the year, Youve had one or more employees working at least 20 weeks during the year, even if theyre part-time or temporary employees and worked part of a day, The wages of your children under 21 if youre their employer. Exceptions include employers of household employees, agricultural employers, Indian tribe governments, tax-exempt organizations, and state and local government employers. If the flat tax has no limit, "no limit" appears in this field. The employers in these states may have to pay more unemployment taxes for each employee unless the state has repaid its loan. A credit of up to 5.4 percent for state unemployment taxes can reduce the FUTA tax owed by employers on their payroll, but only if you are subject to state or local unemployment taxes. For Quarter 3 (July to September), the FUTA Tax Payment is due by October 31. According to the IRS, the standard FUTA tax rate is 6%. Your email address will not be published. E-file Starts at $4.95 /form. This article was originally written on January 3, 2020 and updated on February 2, 2023. These reductions in tax revenue due to lower tax rates are being made up by transfers from the general . Your company paid its state unemployment insurance taxes on time (and in full). FUTA Tax per employee = (Taxable Wage Base Limit) x (FUTA Tax Rate). See the table on page 2. 760, Reporting and Deposit Requirements for Agricultural Employers, Schedule A (Form 940), Multi-State Employer and Credit Reduction Information, Publication 15, (Circular E), Employer's Tax Guide, Publication 966, Electronic Federal Tax Payment System, A Guide to Getting Started, Treasury Inspector General for Tax Administration, Topic No. Weekly benefit amounts are also increased 6.5%. Also, FUTA has a much lower wage base than FICA taxes at just $7,000 per employee. Keep records of these calculations to ensure that no interest is charged to you for underpayment of estimated tax because you deposited too little money during the year. Start with their gross pay -- their total salary or wages before deductions and taxes -- and subtract: Lets say you have three employees -- two part-time and one full-time -- with the following earnings for the year: The FUTA tax liability is based on $17,600 of employee earnings ($4,900 + $5,700 + $7,000). The E&T assessment amount cannot be taken as a credit against the Federal unemployment tax (FUTA). Use Schedule A Form 940 to calculate and report Multi-State Employer and Credit Reduction Information to the IRS. You may choose to add FUTA taxes paid for an employee in their pay stubs. FUTA tax credit. Minimum Rate. Federal tax rates apply only to taxable income. Health Savings Account limits for 2020 and 2021. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Copyright 2018 - 2023 The Ascent. The due date for filing the Form 940 is January 31. Its likely that your payroll software calculates and retains your FUTA liability and automatically remits it when the time is right. Employers fund federal unemployment through a FUTA payroll tax. You may withdraw your consent to cookies at any time once you have entered the website through a link in the privacy policy, which you can find at the bottom of each page on the website. Theres a lot to consider here when calculating FUTA tax. The business also needs to report FUTA by filing a Form 940 (or 940-EZ) by January 31 of the following year as part of its annual tax returns. It is a federal payroll tax that provides temporary unemployment benefits to qualified workers who lose their job through no fault of their own. . All rights reserved. The higher the trust fund balance, the lower the taxable wage base. All 2023 Unemployment Insurance Tax Rate Determinations were sent out by U.S. mail to Minnesota employers on or before December 15, 2022. ( SSA Press Release, 10/13/2022) For 2023, the FICA tax rate for both employers and employees is 7.65% (6.2% for OASDI and 1.45% for Medicare). The tax rate for new employers remains 1% in 2022. FUTA Tax Rates and Taxable Wage Base Limit for 2022. HR Support From Abacus Payroll: Check out our HR Help Center for $11/month . In 2022, the Medicare tax rate for employers and employees is 1.45% of all wages, unchanged . But after a period of time (again, varying by state), the rate will be re-evaluated, and employers who have had higher unemployment claims will be charged more. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Each state has a range of SUTA tax rates ranging from (0.65% to 6.8%). Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. FICA taxes are also based on payroll, but are a different tax. The due date for the 2023 Form 940 will likely be the same as 2022, though the 2023 Form 940 is not yet available from the IRS. The FUTA tax is calculated based on employee wages, and there is no deduction from the employee's paycheck. When your payroll software issues Form W-2 for each employee, it should send in Form 940. The wage base limit is the maximum threshold for which the SUTA taxes can be withheld. In addition to cookies that are strictly necessary to operate this website, we use the following types of cookies to improve your experience and our services: Functional cookies to enhance your experience (e.g. (Email response to inquiry, 9-27-2021.). Includes all the Supporting Forms Schedule-A,8453-EMP, & 940-V. If it seems complicated (and it can be) you may want to work with an accounting professional, use accounting software that includes payroll (including FUTA), or use a payroll services company that includes FUTA and SUTA tax management. The Federal Unemployment Tax Act (FUTA) is the law that requires employers to pay payroll taxes that provides unemployment compensation to workers who have lost their jobs. North Carolina's unemployment-taxable wage base is $28,000 for 2022, up from $26,000 in 2021, the state's Department of Commerce announced on its website Jan. 5. Comment * document.getElementById("comment").setAttribute( "id", "ae158e54b67c1cb6deddb4aa28fcfe1b" );document.getElementById("h09971f2bf").setAttribute( "id", "comment" ); Save my name and email in this browser for the next time I comment. In this guide, we break down what FUTA means, when your business must pay it and tips to make sure its done properly. The FUTA tax applies to the first $7,000 in wages you pay an employee throughout the calendar year. Health Savings Account limits for 2021 and 2022. Reviews Disclosure: The responses below are not provided or commissioned by the credit card, financing and service companies that appear on this site. The maximum Social Security employer contribution will increase $818.40 in 2023. Copyright 1996 2023, Ernst & Young LLP. Each employer's payroll for the last three fiscal years as of July 31 of the current year is divided into the applicable credit or debit balance to yield a ratio. The calendar quarter dates on the left represent the pay period during which your employee received wages. In 2013, legislation (HB 168) increased the SUI taxable wage base to a minimum of $10,500 and a maximum of $18,500 by linking the wage limit to the balance of the state's unemployment trust fund. Tax rate for new employers: View rates. This information in this communication is general in nature, and is not intended, nor should it be construed, as legal, accounting, tax or other professional advice rendered by GreenSlate, LLC. And if you are not good at that kind of stuff but want to get it done on time, then hiring a professional is probably your best choice. SUTA tax rates will vary for each state. Unemployment Tax Rates. The first $7,000 for each employee will be the taxable wage base limit for FUTA. If the tax has a default rate that has been overridden in Company Tax Group Maintenance, an asterisk (*) appears next to the tax rate. Your Unemployment Insurance (UI) and Employment Training Tax (ETT rates are combined on the Notice of Contribution Rates and Statement of UI Reserve Account (DE 2088). SUTA rates range from 0.85% - 8.65% for 2023. This applies to the first $7000 of taxable wages per employee. All rights reserved. According to a senior Workforce West Virginia representative, to achieve the 25% savings in 2022, Governor Justice intends to reduce the 2022 SUI taxable wage base from $12,000 to $9,000, which would require legislation to implement. FUTA taxes are reported on IRS Form 940, which is due on January 31 each year. This means, instead of getting credit for 5.4% of the 6% tax due, employers in those states would receive a credit of only 5.1% instead. In case you have deposited FUTA taxes on time for all quarters, you may file the form by February 10. Your state wage base may be different based on the respective states rules. These are employees that you filed Form W-2 for. The FUTA tax applies to the first $7,000 in wages you pay an employee throughout the calendar year. Adoption assistance benefits are not currently exempt from FUTA, while dependent care assistance is exempt up to limits, currently up to $5,000 ($2,500 for married employees filing separate returns). The conditional factor (D) calculation for 2023 must then be applied, which for rates of 0.1% to 0.9%, simply add 0.6%. Shes an expert on credit reporting, credit scoring, identity theft, budgeting, and debt eradication. FUTA is one of those taxes you must make sure you calculate correctly and pay on time. The Federal Unemployment Tax Act (FUTA) requires the employers to pay the FUTA taxes quarterly and report the same on FUTA tax rate: The FUTA tax rate is 6.0%. remember settings), Performance cookies to measure the website's performance and improve your experience, Marketing/Targeting cookies which are set by third parties with whom we execute marketing campaigns and allow us to provide you with content relevant to you. Add the total gross wages for all employees in any quarter and divide by 4. Your small businesss FUTA tax liability for the year is $105.60 ($17,600 * 0.006). Multiply the amount by 0.07. The chart below outlines 2023 SUTA employer tax rate ranges. If I'm on Disability, Can I Still Get a Loan? Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. US employment tax rates and limits for 2021, Health Savings Account limits for 2021 and 2022, Fringe-benefit inflation adjustments and Form W-2 penalties for 2022, Federal mileage rates and luxury vehicle limit for 2022, Per diem rates under high-low substantiation method for 2022, State unemployment insurance wage bases and tax rates for 2022, Disability and paid family leave insurance wage base and rates for 2022, State income tax withholding tables, supplemental withholding and highest withholding tax rates for 2022. Legislation in 2020 (SB 20-207) held the SUI taxable wage base at $13,600 for calendar year 2021 with incremental increases each year thereafter until it reaches $30,600 in 2026. Deposit or pay any federal non-FUTA taxes as well as FUTA taxes by the deposit schedule or due dates so that you meet all filing requirements. The standard FUTA rate in 2022 is 6%, with a taxable wage base of $7,000 (per employee) or taxable wages up to $7,000. Please help us keep our site clean and protect yourself. And theres one more wrinkle to consider. The State Disability Insurance (SDI) tax rate can be found by visiting Tax-Rated Employers.We will mail your DE 2088 in December and you can get a copy by logging in to e-Services for Business. Employers who also pay state unemployment tax can get a federal tax credit of up to 5.4%, reducing the effective FUTA rate to 0.6%. Best Mortgage Lenders for First-Time Homebuyers. Employer rate. The standard FUTA rate in 2022 is 6%, with a taxable wage base of $7,000 (per employee) or taxable wages up to $7,000. 0.6%. Ryan Lasker is an SMB accounting expert writing for The Ascent and The Motley Fool. General employers are liable if they have had a quarterly payroll of $1,500 or more or have had an employee for 20 weeks or more during a calendar year. The effective tax rate for 2022 is 0.6%. However, this credit will be reduced by 0.3 percent to 5.1 percent for the 2022 tax year. With 123PayStubs, you can easily add the employer-paid taxes such as FUTA, SUTA, and other state-specific employer-paid taxes to the pay stubs, along with accurate tax calculations. If a business pays wages subject to unemployment tax in a credit reduction state, your business may not be eligible for the full credit against your FUTA tax rate. Every employer pays FUTA; nothing is taken from the employees pay. The legislature did not override the governor's veto. The taxable wage base remains $9,000 for all other employers. Find out the trending topics in the payroll industry and the product updates from 123PayStubs. | Privacy Policy We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The FUTA tax rate is 6% of the first $7,000 of wages, though many businesses qualify for a tax credit that lowers it to 0.6%. Page Last Reviewed or Updated: 08-Feb-2023, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation, Electronic Federal Tax Payment System (EFTPS), Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, Publication 15, (Circular E), Employers Tax Guide, Publication 926, Household Employers Tax Guide, Publication 51, (Circular A), Agricultural Employers Tax Guide, Topic No. This results in the minimum amount of FUTA tax of $42 per employee. The Tennessee UI trust fund balance as of November 30, 2021, was $1,119,103,499. Michelle is also an experienced personal finance and travel writer. In 2023, this rises to $160,200. Employers report FUTA tax by filing an annual Form 940 with the IRS. Although Form 940 covers a calendar year, you may have to deposit your FUTA tax before you file your return. Illinois. Let's break down the limits and how to calculate it. The Federal Unemployment Tax Act came into law after the worst recession the U.S. had ever seen, where unemployment spiked to unprecedented levels. View More Features Customer Reviews. The FCR and FUTA rates that will be charged for 2023 are listed below. In other words, the maximum FUTA tax rate per employee to be paid by the employer for 2022 is calculated as: $7000 * 6% = $420. Refer to Publication 966, Electronic Federal Tax Payment System, A Guide to Getting StartedPDF for electronic federal tax payment system information, and Publication 15 for more information on deposit rules. Small business owners carry a lot of responsibility on their shoulders. Email [email protected] Another factor is credit for state unemployment tax paid to a state unemployment fund. Tax rates for experienced employers continue to range from 0.06% to 5.76%. In our final 2022 edition of US employment tax rates and limits you will find, as of December 16, 2022, the following: Social Security wage base for 2022. Any Canadians earning less than $53,359 in taxable income . The FUTA rate is 6.0% (before state tax credits) of what you paid an employee during the quarter. FUTA Tax per employee = (Taxable Wage Base Limit) x (FUTA Tax Rate). This article currently has 61 ratings with an average of 4.5 stars. Click here to know how to add FUTA taxes to pay stubs.. Access our support center for frequently asked questions and answers about 123PayStubs. Businesses dont pay FUTA tax on contractors since theyre not considered employees. 129 S Main St, #260, Grapevine, TX 76051, United States, 11845 W Olympic Blvd, West Tower, 11th Floor, Los Angeles, CA 90064, United States, Copyright 2023 Paystubsnow.com, LLC All Rights Reserved. For details, see "Successor employer" in the Instructions for Form 940. Annual Federal Unemployment Tax Return (Form 940), Wage and Tax Statement (Form W-2), and . These rates do not include the Workforce Investment and Training . Generally you must file a Form 940 and pay FUTA tax (on non-household employees or farmworkers) for 2022 for employees if you answer yes to either of these questions (referred to as the general test): You must file a Form 940 and pay FUTA tax (on non-household employees or farmworkers) in 2022 for employees who arent if your business satisfies any of the following criteria: There are some exemptions, as we will discuss next. For budgeting purposes, you should assume a 0.6% FUTA rate on the first $7,000 in wages for all states with an additional percentage to be charged to cover the FUTA Credit Reduction . Maximum Rate . With the mass unemployment that resulted from the COVID-19 pandemic, many states have had to borrow from the Federal government in order to pay unemployment benefits. This $7,000 is known as the taxable wage base. (In years where credit reduction states apply, you must include liabilities owed for credit reduction with your fourth quarter deposit.). This results in a net FUTA tax rate of .06%. This field displays the flat tax limit and can only be viewed. The Federal Unemployment Tax Act (FUTA), is a federal law that requires employers to pay unemployment taxes. Based on economic conditions, an employer's tax rate could be as low as 0.060% or as high as 5.760%. The new federal tax brackets for Canadians in 2023. You may have to do everything from securing small business loans to setting the vision for your brand. How do you calculate FUTA tax? The Department of Labor makes an announcement at the end of each year with the list of states that are eligible to receive the full 5.4% tax credit on FUTA tax. Legislation passed in 2021 (SB 89/Act 91) requires that the taxable wage base remains at $7,700 for 2022. The employers under credit reduction state are usually not eligible for the full credit against the FUTA tax rate. The Virgin Islands has carried a federal UI loan balance since 2009, and a FUTA credit reduction has applied since 2011 . The FUTA and SUTA taxes are filed on Form 940 each year, regardless if a business has an employee on unemployment insurance. Bulk Upload Template for Tax Pros. Under the Federal Unemployment Insurance Tax Act (FUTA), the 2022 federal unemployment insurance wage base is $7,000, the maximum tax is 6.0% and the maximum credit reduction is 5.4%, for a net FUTA deposit rate of 0.6%. The tax applies to the first $7,000 you paid to each employee as wages during the year. Continue carrying your tax liability forward until your cumulative FUTA tax liability is more than $500. 2022: $11,000: 2021: $11,000: 2020: $11,500: 2019: $12,000 . Temporary, part-time, and full-time employees count. You can pay extras to employees in addition to . Privacy PolicyTerms of Service, Federal Unemployment Tax Act (FUTA) Updates for 2023. The FUTA rate was initially 3% on both employers and employees for each covered worker from 1940 until 1950, when it changed to 0.20% per employee. The amount owed, or liability, depends on the number of employees and their wages. Legislation enacted in 2016 (SB 235) increased the SUI taxable wage base to $9,500 for calendar years 2018 and 2019. Access our resource articles that would help you get more insights about managing the payroll manually. IRS Announces 2022 Limits for HSAs and High-Deductible Health Plans, SHRM Online, May 2021. Based on economic conditions, an employer's tax rate could be as low as 0.060% or as high as 5 . A business day is any day other than a Saturday, Sunday, or legal holiday. Revised tax rate notices were issued in April 2021. Unemployment benefits help people whove lost their jobs stay afloat while they seek new work. Furthermore, employers who pay state unemployment taxes will likely be eligible for a 5.4% federal tax credit. The business stops paying SUTA tax on Barry's wages once he makes $7,000, which happens in the middle of Q2. The IRS publishes details of the taxability of fringe benefits in Publication 15-B (2023), Employers Tax Guide to Fringe Benefits. Fringe-benefit inflation adjustments and Form W-2 penalties for 2022. . News Thats one month after the end of the third quarter, which is when the FUTA liability grew past $500 for the year. As an employer, you also pay state unemployment tax (SUTA), and in Alaska, New Jersey, and Pennsylvania, employees chip in, too. You can also view limits, if any. Keep in mind the wage base is the limit of SUTA tax withholdings. You had one or more employees for at least some part of a day in any 20 or more different weeks in 2021 or 20 or more different weeks in 2022. Our experts love this top pick,which featuresa0% intro APRuntil 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee. In this case, your answer would be $120.00 ($15,500 x 0.07 = 930). So, if you paid an employee $8,000, you pay 6.0% (before state tax credits) of $7,000 in FUTA. The Social Security Act of 1935 had administered unemployment benefits until FUTA was enacted in 1939. The term legal holiday means any legal holiday in the District of Columbia. Contract workersthose who receive a Form 1099-NECare not considered employees.. The UI agency announced that the taxable wage base of $9,500 will continue for 2022. However, many employers receive a credit of 5.4% because they have paid state unemployment tax (SUTA) taxes on time. Your email address will not be published. The taxable wage base reverted to $9,000 effective January 1, 2020 and will remain at that amount unless changed by future legislation. How do you move long-term value creation from ambition to action? Failure to pay FUTA taxes can lead to significant penalties, including fines and even criminal charges. This discounted FUTA rate can be used if all Unemployment Insurance taxes for 2023 have been paid in full by January 31, 2024; the employer has no out-of-state employees; and the state is not a credit reduction .