Film Accounting Glossary
FUTA and SUTA
What are FUTA and SUTA?
Also called unemployment tax, FUTA, or SUTA.
FUTA and SUTA are the federal and state unemployment insurance taxes an employer pays on wages, and both are employer-only costs inside the fringe rate.
Each applies to a limited wage base per employee per year, so the cost is front-loaded and then stops, and SUTA rates vary by state and by the employer's claims history. On multi-state shoots the state component has to be estimated per work location.
Example
FUTA applies to the first $7,000 of each employee's annual wages, and SUTA to a state-set wage base at a rate reflecting the employer's claims history. Both are front-loaded: heavy in the first weeks of a crew member's year, then zero.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Inside the fringe rate, and estimated per work state on multi-state shoots because the state component varies.
Common mistake
Spreading unemployment tax evenly across the schedule. Both apply only to a limited wage base per employee per year, so the cost is front-loaded and then stops.
Related questions
- Who pays FUTA and SUTA?
- The employer only. Neither is withheld from the employee, and both sit inside the fringe rate as an employer cost.
- Why do unemployment tax costs vary by state?
- Because each state sets its own wage base and rate, and the rate reflects the employer's claims history, so multi-state shoots estimate per work location.