Federal Unemployment Tax Act (FUTA) Rate Reduction

The effective tax rate for the Federal Unemployment Tax Act (FUTA) will be reduced from .8% (.008) to .6% (.006) on July 1, 2011. Congress has announced that the FUTA .2% surcharge, first enacted in 1977, will not be extended after June 30, 2011.

The IRS is currently revising Form 940 (Employer’s Annual Federal Unemployment (FUTA) Tax Return) to accommodate the two different FUTA rates for calendar year 2011.

Please sign in above and the select your product below for a PDF with full instructions on Modifying the FUTA Rate:

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