Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages. Refer to
ID: 2458901 • Letter: U
Question
Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages. Refer to Instruction 5-1. Ted Carman worked for Rivertide Country Club and earned $28,500 during the year. He also worked part time for Harrison Furniture Company and earned $12,400 during the year. The SUTA tax rate for Rivertide Country Club is 4.2% on the first $8,000, and the rate for Harrison Furniture Company is 5.1% on the first $8,000. Calculate the FUTA and SUTA taxes paid by the employers on Carman’s earnings. FUTA SUTA a. Riverside ______________ _____________ b. Harrison Furniture Company ______________ _____________
Explanation / Answer
a. Riverside FUTA 7000 * 0.6% = $42
SUTA 8000 * 4.2% = $336
b. Harrison Furniture Company FUTA $0
SUTA 8000 * 5.1% = $408
As the employee is working part time in Harrison Furniture Company, there would be no liability for the employer to pay FUTA.