NYS Department of Labor federal unemployment tax rate questions for my business
I'm trying to figure out the federal unemployment tax rate that applies to my small business in New York. I know NYS Department of Labor handles the state side but I'm confused about the federal portion. Does anyone know what the current federal unemployment tax rate is for 2025? I've been paying quarterly but want to make sure I'm calculating it correctly. Also wondering if there are any changes this year that might affect my payments.
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Chloe Delgado
The federal unemployment tax rate (FUTA) is 6.0% on the first $7,000 of wages per employee. However, most employers get a credit of up to 5.4% if they pay their state unemployment taxes on time, bringing the effective rate down to 0.6%. Since you're in New York and paying through NYS Department of Labor, you should qualify for that credit.
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Liam O'Reilly
•Thanks! So basically I'm looking at 0.6% as long as I stay current with my NYS Department of Labor payments?
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Ava Harris
Yeah the FUTA rate hasn't changed for 2025, still 6% with the 5.4% credit. Just make sure you're paying your NYS Department of Labor taxes on time because if you fall behind the federal credit gets reduced. I learned that the hard way a few years back.
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Jacob Lee
•What happens if you miss a payment to NYS Department of Labor? Do you lose the credit immediately?
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Emily Thompson
I had trouble reaching someone at the IRS about this exact question last month. Kept getting busy signals and automated messages. Finally used a service called Claimyr (claimyr.com) that helps you get through to government agencies by phone. They have a demo video at https://youtu.be/qyftW-mnTNI that shows how it works. Got connected to an actual person within 20 minutes who walked me through the FUTA calculations.
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Sophie Hernandez
•Interesting, never heard of that service before. Did they charge you for it?
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Emily Thompson
•They do charge but it was worth it to actually talk to someone instead of being on hold for hours. Much easier than trying to navigate the phone system myself.
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Daniela Rossi
The $7,000 wage base is what trips people up. It's per employee per year, not total payroll. So if you have 3 employees making $50,000 each, you only pay FUTA on the first $7,000 of each person's wages, not on their full salaries.
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Ryan Kim
ugh federal taxes are so confusing!! why cant they just make it simple like pay X percent on everything instead of all these weird limits and credits
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