How much does an employee cost on top of salary?

Employer payroll taxes alone add roughly 7.65% (Social Security and Medicare) plus unemployment taxes. With workers' comp, benefits and overhead, the total is often 20% to 40% above salary.

What is the Social Security wage base for 2027?

$192,300, up from $184,500 in 2026. Employer Social Security tax stops at that level of wages.

Why is my FUTA higher than $42?

Employers in states with an outstanding federal unemployment loan pay extra FUTA (a credit reduction). The list for each year is published in November.

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Employee cost calculator What does that hire really cost?

A salary is only the start. Add employer payroll taxes, workers’ comp, benefits and overhead, then compare the total with outsourcing your bookkeeping or back office. Free, no sign-up.

General information, not tax or legal advice. Updated October 22, 2026.

Employer costs on top of salary

Cost	2026	2027
Social Security (employer share)	6.2% up to $184,500	6.2% up to $192,300
Medicare (employer share)	1.45% of all wages	1.45% of all wages
Federal unemployment (FUTA)	0.6% of the first $7,000	0.6% of the first $7,000
State unemployment, workers’ comp	Vary by state and job

Example

A $60,000 bookkeeper in 2026 with 2.7% state unemployment on $7,000, 1.5% workers’ comp, $8,000 health insurance, a 3% retirement match and $3,000 of software and equipment costs about $78,521 a year. Our Bookkeeping Growth plan is $18,000 a year.

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Sources: Social Security Administration, Contribution and Benefit Base; IRC sections 3111 (FICA) and 3301 (FUTA); IRS Publication 15. Employer Medicare is 1.45% (the extra 0.9% is withheld from employees only). An estimate, not payroll advice.