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DIY ezPaycheck Payroll Tax Software: How to Set up FUTA and SUTA

ezPaycheck payroll software estimates the unemployment tax based on your set up. Some companies may be able to take credit to pay unemployment tax at lower rate. In some states, your local office will mail you the new rate for next year in Dec. You can also call them to find your rate. Please enter your rate correctly, so you can reserve the fund amount correctly.

Do not worry If you entered a higher rate or a lower rate by mistake. You still have the chance to correct it when you file the year-end report (ie: form 940) to make deposit.

Step 1: Open company tax information setup screen

  • Start ezPaycheck payroll software
  • Click the left menu "Company Settings" then click the sub menu "Tax Information" to open the company tax setup screen
    payroll application tax option setup
    (Click image to enlarge)

    Step 2: Federal Unemployment Tax

    FUTA (Federal Unemployment Tax) is Employer-side tax only and will not be printed on paycheck stubs

    The default tax rate for 2017 is 6%. However, many companies can take up to 5.4% credit. Please check with your local IRS office to see what rate you should use.

    For example:
    - If your FUTA rate is 0.06 (6%), please enter 6 there.
    - If your FUTA rate is 0.006 (0.6%), please enter 0.6 there

    The FUTA tax applies to the first $7,000 you paid to each employee as wages during the year.

    If you set up the wrong FUTA rate before, you still have chance to correct it when you file Form 940.

    Step 3: State Unemployment Tax

    SUTA (State Unemployment Tax) is Employer-side tax only and will not be printed on paycheck stubs

    Step 4: Click the UPDATE button to save your changes

    ezPaycheck will withhold FUTA and SUTA according to your setup.

    Note: Reports

    If you want to see FUTA and SUTA withhold information, you can check reports part.

    payroll reports
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