Most employers with one or more employees are required to pay state unemployment insurance tax. The [Federal Unemployment Tax Act (FUTA)](https://www.law.cornell.edu/uscode/text/26/3301) requires covered employers to pay both federal and state unemployment taxes. The state unemployment tax rate for 2025 ranges from 0.05% to 8.80% on the first $9,000 of each employee’s wages, according to the [IRS Revenue Procedure 2024-40](https://www.irs.gov/pub/irs-drop/rp-24-40.pdf). However, specific rules and rates can vary by state.
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