The Federal Unemployment Tax Act (FUTA) is a law that imposes a payroll tax on any business with employees; the income generated is used to fund unemployment benefits.
As of 2021, the FUTA tax rate is 6% on the first $7,000 paid annually to each employee.
Although the FUTA payroll tax is based on the wages of employees, it is only levied on employers and not on their employees.
FUTA and SUTA are similar taxes, just levied on different levels of government, while FUTA and FICA fund completely different programs by charging different people.
– Employers who also pay State Unemployment Insurance may receive a federal tax credit of up to 5.4%, resulting in an effective FUTA tax rate of 0.6%.
Choice 83(b) is an Internal Revenue Code (IRC) provision that gives an employee or startup founder the ability to pay taxes on the total fair market value of the restricted shares at the time of grant.
A franchise tax is a fee paid by certain businesses that want to do business in certain states. Contrary to what the name implies, a franchise tax is not a franchise tax.
Business partners, S corporation shareholders, and investors in limited partnerships and certain ETFs use Appendix K-1 to report their income, losses, and dividends.
External economies of scale - these are factors that contribute to the development of business, which are manifested outside the company, but within the same industry.