Which Wages Are Subject to FUTA & SUTA?

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Only certain types of wages are going to be subject to both FUTA and SUTA. Learn about which wages are subject to FUTA and SUTA with help from an accounting professional in this free video clip.

Part of the Video Series: Accounting & Finance
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Video Transcript

Hi, I'm Lori Greer from Atlanta, Georgia, and I'm here to answer the question which wages are subject to FUTA and SUTA. The Federal Unemployment Tax Act or FUTA is a United States Federal Law that requires employers to pay a portion of every employee's earnings to fund state unemployment agencies. State Unemployment Tax Acts or SUTA also require employers to pay a tax to fund the state unemployment agencies as well. You will want to consult a tax professional though to confirm but here are some wages that would be exempt, wages for services performed outside of the United States. Wages paid to a deceased employee or a deceased employee's estate in any year after the year of the employee's death, wages paid by a parent to a child under age 21, paid by a child to a parent, or paid by one spouse to the other spouse, wages paid by a foreign government or international organization and wages paid by nonprofit organizations. As I mentioned, these are just a few exemptions of several that are available from FUTA and SUTA. You will want to consult with a tax professional for more information. Again, I'm Lori Greer from Atlanta, Georgia and we just answered the question which wages are subject to FUTA and SUTA.


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