Page 276 - Essentials of Payroll: Management and Accounting

Unemployment Insurance
• Contributions payable at experience rate. Multiply the
taxable payroll from the third column by the state
experience rate.
• Additional credit. Subtract the total contributions
payable at the experience rate from the total contribu-
tions if the rate had been 5.4 percent. If the result is
zero or less, enter a zero in this field; otherwise, enter
the difference.
• Contributions paid to state by 940 due date. Enter the

total amount of all payments actually paid to the state
by the due date for this tax. Any amounts not paid are
excluded from this calculation, which essentially imposes
a significant penalty on any FUTA late payers.

11. Total tentative credit (Part II, Line 3b). Combine the totals from
the additional credit and state contributions columns.The result is
the minimum total amount of the credit that can potentially be
applied against the FUTA tax.

12. Credit (Part II, Line 6). This is the actual amount of credit used
to offset the FUTA tax. It is the lesser of the total tentative credit
(which is based on actual payments to state governments) or the
theoretical maximum credit of 5.4 percent of applicable wages.

13. Total FUTA tax (Part II, Line 7). Subtract the preceding credit
from the total amount of the gross FUTA tax listed on line 2 of
Part II. If the amount of this tax exceeds $100, be sure to com-
plete Part III of the form as well.

14. Total FUTA tax deposited (Part II, Line 8). Summarize all FUTA
payments already made, as well as any overpayment carried for-

ward from the previous year.

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