The Complete Guide to SUTA Rates by State (2026)

State Unemployment Tax (SUTA) is one of the most misunderstood employer payroll taxes — partly because it varies dramatically by state, and partly because your rate changes over time based on your own claims history. Pay too little attention to it, and you'll get surprised by your quarterly bill. Manage it actively, and you can significantly lower your costs over time.

This guide covers 2026 SUTA rates for all 50 states plus DC, explains how experience rating works, and shows you strategies to reduce your rate.

How SUTA Works: The Basics

SUTA has three key variables:

1. Rate: Your percentage, assigned by the state based on your industry and claims history
2. Wage Base: The maximum wages per employee subject to SUTA (varies by state from $7,000 to $101,400)
3. Experience Rating: Your rate adjusts annually based on how many former employees filed unemployment claims against you

SUTA formula: Annual SUTA per employee = Rate × min(Employee's wages, State wage base)

2026 SUTA Rates: Low-Wage-Base States

State	New Employer Rate	Wage Base	Max SUTA/Employee	Rate Range (Experienced)
Arizona	2.0%	$8,000	$160	0.04% - 10.21%
California	3.4%	$7,000	$238	1.5% - 6.2%
Florida	2.7%	$7,000	$189	0.1% - 5.4%
Georgia	2.7%	$9,500	$257	0.04% - 8.1%
Mississippi	1.0%	$14,000	$140	0.0% - 5.4%
North Carolina	1.0%	$31,400	$314	0.06% - 5.76%
Tennessee	2.7%	$7,000	$189	0.01% - 10.0%
Texas	2.7%	$9,000	$243	0.23% - 6.23%

2026 SUTA Rates: High-Wage-Base States

State	New Employer Rate	Wage Base	Max SUTA/Employee	Rate Range (Experienced)
Alaska	1.0%	$49,700	$497	1.0% - 5.4%
Colorado	1.9%	$23,800	$452	0.75% - 10.39%
Hawaii	3.0%	$61,000	$1,830	0.0% - 6.0%
Nevada	2.95%	$40,600	$1,198	0.25% - 5.4%
New Jersey	3.1%	$42,300	$1,311	0.4% - 5.4%
Oregon	2.4%	$54,300	$1,303	0.7% - 5.4%
Utah	1.0%	$47,000	$470	0.1% - 7.1%
Washington	1.0%	$72,800	$728	0.27% - 6.02%
Wyoming	1.01%	$30,900	$312	0.0% - 8.5%

Notable States: Washington vs. Florida

A tale of two cost structures:

Florida: 2.7% rate on $7,000 wage base = $189/employee. If your 10-person team all earn over $7,000 (they all do), your annual Florida SUTA is $1,890/year — capped, no matter how high salaries are.

Washington: 1.0% rate on $72,800 wage base = $728/employee. Same 10-person team = $7,280/year in SUTA — nearly 4x more, even though the rate is lower. High wage bases destroy the "low rate" advantage.

This is why comparing rates alone misleads. Always calculate: Rate × Wage Base = Max annual cost per employee.

How Experience Rating Changes Your SUTA Over Time

After 1-3 years of operation (varies by state), your rate converts from the new-employer rate to an "experience rate" based on your unemployment claims history. States calculate this differently, but the core formula is:

Experience Rate = (Benefits Charged to Your Account) ÷ (Your Average Taxable Payroll) × Reserve Factor

In plain English: the more former employees who successfully claim unemployment against you, the higher your rate. Businesses with low turnover and few claims can see their rate drop to near 0%. Businesses with high turnover can hit the maximum rate (5-10%+).

Industries with Typically High SUTA Rates

• Construction (seasonal, layoff-prone): often 6-10%
• Restaurants and food service: often 5-8%
• Retail (holiday seasonal staffing): often 4-6%
• Temp staffing agencies: often at maximum rates

Industries with Typically Low SUTA Rates

• Professional services: often 1-3%
• Technology: often 0.5-2%
• Healthcare (long-tenured staff): often 1-3%

Strategies to Lower Your SUTA Rate

1. Contest Fraudulent or Ineligible Unemployment Claims

Not every unemployment claim should be approved. Employees who quit voluntarily, were terminated for misconduct, or don't meet eligibility requirements should not be charged to your account. When you receive a Notice of Claim, respond within the deadline (usually 10-14 days) with documentation of why the claim should be denied. Each successful protest protects your experience rating.

2. Reduce Voluntary Turnover

Employees who quit are generally ineligible for unemployment — only involuntary separations count against you. Improving retention through better management, competitive pay, and career development directly reduces your SUTA cost over time.

3. Use Voluntary Contribution Programs

Many states allow "voluntary contributions" — paying extra into your account to artificially lower your rate. If your state does this and the math works (contribution < tax savings), it's a no-brainer. Your state's unemployment agency website will have a calculator.

4. Consider Layoff Alternatives

Some states allow "shared work" programs where employees reduce hours temporarily instead of being laid off. Workers receive partial unemployment benefits, and the claims are charged at lower rates. This helps both employees (keep some income) and employers (lower SUTA impact).

Calculate Your SUTA for Any State

Use our Employee Cost Calculator to see the exact SUTA obligation for your state and salary level. Our Payroll Tax Calculator shows a complete breakdown of all employer payroll taxes — FICA, FUTA, and SUTA — with your state's specific 2026 rates.

Explore individual state pages for detailed SUTA data: California, New York, Texas, Florida, and all other states.