Payroll Tax Rates
What are the 2026 payroll tax rates in the U.S.?
Payroll tax rates for 2026 include the federal FICA rate of 7.65% on employees (6.2% Social Security plus 1.45% Medicare) and the same 7.65% matched by employers, with an additional 0.9% Medicare surtax on employee wages over $200,000. The Social Security wage base for 2026 is $184,500 (up from $176,100 in 2025). Federal unemployment tax (FUTA) is 6.0% on the first $7,000 of wages, typically reduced to 0.6% with state credits. State unemployment tax rates vary by state and employer experience.
Payroll tax rates change enough each year to require annual configuration updates in every payroll system. For 2026 the headline change is the Social Security wage base, which rose to $184,500 (up 4.8% from $176,100) to reflect the national average wage index. The FICA rate itself (7.65% employee, 7.65% employer match) is set by statute and hasn't changed since 1990. State unemployment rates vary by state and employer experience rating.
2026 Federal Payroll Tax Rates
FICA employee: 6.2% Social Security up to $184,500 wage base, plus 1.45% Medicare on all wages, plus 0.9% additional Medicare on wages over $200,000. FICA employer match: 6.2% Social Security, 1.45% Medicare. Federal income tax withholding: based on W-4 elections and IRS Publication 15-T tables.
Federal Unemployment (FUTA)
6.0% on first $7,000 of wages per employee per year, reduced to 0.6% when state unemployment is paid timely and state is not credit-reduction. DOL publishes credit-reduction states in November.
State Unemployment (SUTA) Rate Variation
State unemployment rates from 0.1% to 13%+ depending on state and employer experience. Most states set wage base from $7,000 to $70,000+. New employers get an initial rate (2-3%) until claims history develops. See payroll for operational context and FICA for the federal rules.
Updating Tax Rates in Your Payroll System Each Year
Update rates in November-December for the new year. Verify Social Security wage base, state unemployment rates, state disability, local taxes. Test the first payroll of the new year. Coordinate with W-2 year-end. IRS reference: Publication 15.
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