June 2011: FUTA Tax Rate

The federal unemployment rate is comprised of a 6% permanent rate and a 0.2% surtax.  The 0.2% surtax has been in effect since 1976 and is currently set to expire on June 30, 2011 unless Congress acts soon.  Employers get a credit up to 5.4% for contributions paid into state unemployment funds.  Missouri has outstanding loan balances with the unemployment trust fund.  If these loans are not repaid by November 11, 2011, Missouri employers will only get a 5.1% credit against their federal unemployment tax.  This means Missouri employers may pay a federal unemployment rate of 1.1%  (6% + 0.2% - 5.1%) through June 30 and 0.9% (6% - 5.1%) from July 1 to December 31, 2011.  Missouri employers have been paying 0.8% (6% + 0.2% - 5.4%) during recent years through 2010.  The FUTA tax applies to the first $7,000 the employer pays to each employee as wages during the year.