Federal Unemployment Tax Act

The Federal Unemployment Tax Act is a part of Chapter 26 of the Federal Code commonly referred to as the Internal Revenue Code. This act requires employers to pay a tax that funds unemployment benefits during economic depressions/recessions. It is also commonly referred to as FUTA.

FUTA – An Explanation to the Federal Unemployment Tax Act

FUTA

Federal Unemployment Tax Act or FUTA for short is a part of the Internal Revenue Code and is an employer tax on wages paid to employees.  It is used to fund unemployment benefits.  The tax is paid on the first $7,000 of wages paid to every employee.  It is reported via Form 940 https://businessecon.org/resources/ .  The Form must be filed and all taxes paid by January 31, 2019.

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