2026 FUTA Tax Rate & Wage Base

Who it applies to

FUTA is an employer tax. Publication 15 says only the employer pays FUTA tax and that it is not withheld from the employee's wages. The guide gives three independent tests, each covering a different category of employee. Under the general test you are subject to FUTA tax in 2026 if you paid wages of at least the quarterly amount the guide states in any calendar quarter in 2025 or 2026, or if you had one or more employees for at least some part of a day in as many different weeks as the guide specifies in either year. The household employees test is measured by total cash wages paid to household employees in a calendar quarter, and the farmworkers test by cash wages paid to farmworkers in a calendar quarter or by the number of farmworkers employed in enough different weeks. Wages paid to H-2A visa workers count when you decide whether the farmworker test is met, but those wages are not themselves subject to FUTA tax.

What changed this year, and why

The FUTA wage base for 2026 is $7,000, the same amount that applied for 2025. Publication 15 (2026), the Employer's Tax Guide, states it in section 14: the FUTA tax applies to the first $7,000 you pay to each employee as wages during the year, and that $7,000 is the federal wage base. Nothing in the What's New items for 2026 touches it. Those items cover the social security and Medicare tax rates and the social security wage base limit, the permanent extension of the individual income tax rates by the One Big Beautiful Bill Act and what it means for supplemental wage and backup withholding, the raised information reporting thresholds, and the new withholding treatment of qualified tips and overtime. The Reminders add that an amended Form 940 can now be filed electronically through Modernized e-File. The guide also warns that a state wage base limit may be different from the federal one, and that the credit an employer takes for state unemployment contributions, together with any credit reduction the U.S. Department of Labor determines for a state, changes what the employer owes rather than the wages the tax is measured on.

Common questions

What is the FUTA wage base for 2026?

It is $7,000. Publication 15 (2026) says the FUTA tax applies to the first $7,000 you pay to each employee as wages during the year, and calls that $7,000 the federal wage base. Wages you pay the same employee above that point later in the calendar year are not part of the FUTA taxable wages you carry to Form 940.

Did the FUTA wage base change from 2025 to 2026?

No. It was $7,000 for 2025 and it is $7,000 for 2026. The amount is set by statute rather than adjusted for inflation each year, so it does not move with the annual inflation adjustments that change most other payroll and tax figures.

Is the $7,000 measured per employee or per employer?

Per employee, and each employer applies it to its own payroll. Publication 15 gives one exception: a successor employer who acquired a business from an employer who was liable for FUTA tax may count the wages that employer paid to employees who continue to work for the successor when figuring the $7,000 FUTA tax wage base limit.

Does my state use the same $7,000 wage base?

Not necessarily. Publication 15 says your state wage base limit may be different from the federal one. It adds that in some states the wages subject to state unemployment tax are the same as the wages subject to FUTA tax, while other states exclude some types of wages, such as wages paid to corporate officers or certain payments of sick pay by unions, from state unemployment tax even though those wages are subject to FUTA tax.

When do I stop depositing FUTA tax for an employee?

Publication 15 says to stop depositing FUTA tax on an employee's wages when taxable wages reach $7,000 for the calendar year. For deposit purposes FUTA tax is figured quarterly, and a deposit is due by the last day of the first month that follows the end of the quarter, moving to the next business day when that date falls on a Saturday, Sunday, or legal holiday.

Which form reports FUTA tax?

Form 940, the Employer's Annual Federal Unemployment (FUTA) Tax Return. Publication 15 says to use Form 940 to report FUTA tax. Household employers who did not report employment taxes for household employees on Form 941, Form 943, or Form 944 report FUTA tax for those employees on Schedule H (Form 1040) instead, and they need an EIN to file it.

Does the FUTA wage base change what an employer actually owes?

It sets the wages the tax is measured on, and the credit for state unemployment contributions then sets most of what is left. Publication 15 says an employer generally takes a credit against FUTA tax for amounts paid into state unemployment funds, and is entitled to the maximum credit when state unemployment taxes were paid in full, on time, and on all the same wages subject to FUTA tax, as long as the state is not determined to be a credit reduction state.

Every amount on this page is a published figure rather than yours. The FUTA wage base headroom takes the number you enter and works it out against them, showing which published figure it used.