Mary Gonzalez had total cumulative gross earnings of $5,800 as of 1/31/19. Her gross earnings for the pay period ending 2/15/19 were $3,000. If federal unemployment taxes are 0.6% on a maximum earnings of $7,000 per year, how much federal unemployment tax will be paid by Mary and how much will be paid by her employer for her earnings of 2/15/19?

Question

Quizplus · Accepted Answer

Federal unemployment taxes are only assessed on the first $7,000 of an employee's earnings. Since Mary's total cumulative gross earnings as of 1/31/19 were only $5,800, only a portion of her earnings are subject to this tax. For the pay period ending 2/15/19, Mary earned an additional $3,000. Since this is less than the maximum earnings subject to the tax, her employer will be responsible for paying the entire federal unemployment tax on this pay period. Therefore, Mary will pay $0 and her employer will pay 0.006 x $3,000 = $18 x 0.6% = $7.20.

Mary Gonzalez Had Total Cumulative Gross Earnings of $5,800 as of 1/31/19