Employer Payroll Cost Calculator
See the employer side of payroll: Social Security and Medicare match, FUTA, SUTA, workers' comp, and benefits, with the burden multiple and true hourly cost.
Employer Payroll Cost Calculator
The wage
Gross wages for the year before anything is withheld. Include expected overtime, bonuses, and commission, since all of it is FICA wages.
Base rate before any shift or overtime premium. To build the annual figure from a rate and a schedule, the hourly to paystub earnings calculator does that step.
Drop this below 52 for seasonal or part-year work. A 40 hour week over 44 weeks is 1,760 annual hours, and the true hourly cost follows.
Employer add-ons
Your share of health, dental, and vision premiums, plus life and disability cover. Leave out whatever the employee pays through payroll.
Employer contributions to a 401(k), SIMPLE, or SEP. Real plans cap out under the IRC section 415(c) annual additions limit, which this tool does not model.
The experience rate on your state unemployment tax notice. New employers are often assigned something near 2.7%. A rate of 0.00% is valid, not a blank field.
Percent of payroll. A manual rate quoted as $1.50 per $100 of payroll is 1.5% here.
Laptop and tools, software seats, training, recruiting amortized over the year, payroll service fees.
Adjust the assumptions
Set by your state. 2026 bases run from $7,000 (California, Florida, Texas) to $72,800 (Washington).
Pick No credit if you are in a FUTA credit-reduction state or you paid state unemployment tax late, which forfeits some or all of the 5.4% credit.
Full time is 2,080 hours. In hourly mode this is set from hours per week times weeks per year.
Costing a 1099 contractor instead? None of these employer taxes apply. You pay the invoice and file a 1099-NEC. Same worker, very different number, which is why the classification on the pay stub matters.
Show the math
| Line | Base it applies to | Rate | Amount |
|---|
Each line is rounded to the cent on its own, then the rounded lines are added, so the breakdown ties to the total exactly. The 0.9% Additional Medicare Tax is deliberately absent: it is withheld from the employee and carries no employer match.
What employers actually pay on top of wages
Wages are the easy part. The employer bill splits into two layers: taxes you have no say over, and costs you choose.
The mandatory layer, with the 2026 figures attached:
- Social Security, 6.2% on the first $184,500 of each employee's wages. Shared with the employee, who pays the same 6.2%. The employer share tops out at $11,439 per person.
- Medicare, 1.45% on every dollar of wages, no cap. Also shared 50/50. The 0.9% Additional Medicare Tax above $200,000 is employee-only, and there is no employer match, so it never belongs in a cost figure.
- FUTA, 6.0% on the first $7,000 of wages, less a credit of up to 5.4% for state unemployment tax paid on time. Employer-only. Most employers pay the net 0.6%, a maximum of $42 per employee per year.
- SUTA (state unemployment), your experience rate on your state's taxable wage base. Employer-only in nearly every state.
Then the layer you control: your share of health, dental, and vision premiums, the retirement match, workers' compensation insurance, and everything else a working person needs to do the job (laptop, phone, software seats, training).
One line that is not an employer cost: federal and state income tax withholding. That is the employee's money passing through your payroll account on its way to the tax agency. It reduces their net pay, not your bank balance.
How to calculate total employer cost, step by step
Take a $60,000 salary with the calculator's default add-ons and work down the lines.
- Social Security: $60,000 x 6.2% = $3,720.00
- Medicare: $60,000 x 1.45% = $870.00
- FUTA: $7,000 x 0.6% = $42.00 (capped base, not the full salary)
- SUTA: $7,000 x 2.7% = $189.00 (on a $7,000 state base)
- Payroll taxes: $4,821.00, which is 8.04% of the wage
- Workers' comp: $60,000 x 1% = $600.00
- Retirement match: $60,000 x 3% = $1,800.00
- Benefits: $8,000.00
Total annual employer cost is $75,221.00. That is $15,221 above the wage, a 25.4% labor burden, a 1.25x multiple, and $36.16 an hour across 2,080 hours. Divide by 12 and the role costs $6,268.42 a month.
Now run a $220,000 salary and watch what changes. Social Security applies to $184,500, not $220,000, so it is $11,439.00 rather than $13,640.00. Medicare has no cap, so it stays at 1.45% of the whole $220,000, or $3,190.00. The employee also owes 0.9% on the $20,000 above $200,000, which is $180.00 withheld from their check. You do not match a cent of it.
Why the wage bases change the answer
Three caps decide the answer, and plenty of free calculators ignore all three. Social Security stops at $184,500. FUTA stops at $7,000. SUTA stops at whatever base your state sets, which might be $7,000 in California, Florida, and Texas or $72,800 in Washington.
Because FUTA and SUTA sit on such small bases, they are heavily front-loaded. A full-year employee finishes their FUTA liability inside the first quarter and you owe nothing more on them until January. The flip side: a part-year hire at $15,000 still costs the full $42 of FUTA, because $15,000 clears the $7,000 base. Unemployment tax scales with headcount, not with payroll.
The 0.6% assumption is not permanent either. States that borrow from the federal unemployment account and do not repay in time become credit-reduction states, and employers there lose part of the 5.4% credit. Employers who pay state UI late lose it too. Switch the FUTA chip to No credit to see the ceiling: 6.0% on $7,000, or $420 per employee.
Two questions follow this one almost every time. For a contractor, none of this applies: you pay the invoice, file a 1099-NEC, and the worker handles their own self-employment tax. And if you want to know what it costs to promise a specific net amount on a bonus, that is a different calculation, handled by the gross-up calculator. The FICA tax calculator covers the per-paycheck view of the same 6.2% and 1.45%.
Putting employer costs on the pay stub
Employer-side contributions belong on the stub, but in the right column. They are employer contributions, not deductions, because nothing was withheld from the worker. Print the employer FICA match as a deduction and the stub will not reconcile, and the employee will reasonably ask why their pay is short.
Payslip44 builds that document. Employer and employee records are reusable, so you are not retyping an EIN every payroll. Employer-contribution line items carry their own YTD amounts. The worker record holds the W-2 / 1099 / statutory / owner classification. And the Insights view has a labor cost metric, gross plus employer contributions, that matches the total on this page. Everything runs on-device, and stubs export to PDF, PNG, CSV, or text.
To convert the annual figure into a per-payroll budget line, the pay frequency converter handles the division. For the running totals that go in the YTD column, use the YTD earnings calculator.
Know what the hire costs? Download Payslip44 and put the numbers on a real stub.
Frequently Asked Questions
Common questions about employer payroll cost calculator
How much does an employer pay in payroll taxes per employee?
Start with 7.65% FICA: 6.2% Social Security on wages up to $184,500 in 2026, plus 1.45% Medicare on every dollar with no cap. Add FUTA at a net 0.6% on the first $7,000 of wages, then your state SUTA rate on the state taxable wage base. Most employees land between 8% and 10% of wages once all four are in. The FICA tax calculator runs the same 6.2% and 1.45% math per pay period if you want the per-check figure.
What is the true cost of an employee beyond their salary?
Usually 1.25x to 1.4x base pay once payroll taxes, benefits, a retirement match, and workers' comp are counted. A $60,000 salary with $8,000 of benefits, a 3% match, 2.7% SUTA, and 1% workers' comp costs $75,221 a year, a 1.25x multiple. Trades with steep workers' comp manual rates run higher, sometimes past 1.5x.
Which payroll taxes does the employer pay alone?
FUTA, and in almost every state, SUTA. Social Security and Medicare are split 50/50 between employer and employee. Federal and state income tax withholding is not an employer cost at all: that is the employee's own money moving from gross pay to the tax agency. Alaska, New Jersey, and Pennsylvania also withhold a small employee unemployment share. This tool skips it, because it is not employer money.
Does the employer match the 0.9% Additional Medicare Tax?
No. The 0.9% surtax on wages above $200,000 (single) or $250,000 (married filing jointly) is withheld from the employee only. There is no employer match, so it never belongs in employer cost. Calculators that add it to the employer column overstate the bill. This one leaves it out and flags it separately as an employee withholding item.
How is FUTA calculated, and why is it usually 0.6% and not 6%?
FUTA is 6.0% of the first $7,000 of each employee's annual wages. Employers who pay their state unemployment tax in full and on time earn a credit of up to 5.4%, which leaves a net 0.6%, or $42 per employee per year at most. In a credit-reduction state, or if you paid state UI late, the credit shrinks or disappears and the full 6.0% ($420 per employee) applies. Switch the FUTA chip above to model that.
What is a labor burden rate and how do I calculate it?
Burden rate is everything you spend on an employee above their wage, divided by that wage. Total cost of $75,221 on a $60,000 salary is $15,221 of burden, which is 25.4%, or a 1.25x multiple. Contractors bidding work usually want that same answer as a fully loaded hourly figure, which on 2,080 hours is $36.16 per hour.
What SUTA rate and wage base should I enter?
Use the experience rate printed on your state's annual unemployment tax notice, plus that state's taxable wage base. The 2026 bases run from $7,000 (California, Florida, Texas) up to $72,800 (Washington). New employers usually get a standard rate near 2.7%. Federal law requires every state base to be at least the $7,000 FUTA base, so the field clamps there.
Does the Social Security wage base cap lower my cost for high earners?
Yes. Employer Social Security stops after $184,500 of wages in 2026, a maximum of $11,439 per employee, so the employer tax percentage falls as salary climbs above the cap. Medicare keeps applying to every dollar at 1.45%. On a $220,000 salary the employer pays $11,439 of Social Security rather than $13,640, while the employee owes an extra $180 of Additional Medicare Tax that the employer does not match.