Summary Definition: A state-based payroll tax that funds unemployment efforts for those without a job.
The State Unemployment Tax Act (SUTA) is a state-based payroll tax that funds unemployment benefits and programs for out-of-work citizens.
Also known as State Unemployment Insurance (SUI), the amount and rate for a SUTA tax varies by state but is always paid in addition to the Federal Unemployment Tax Act (FUTA) payroll tax.
SUTA funds are intended to supplement FUTA funds and help prevent citizens from experiencing financial hardship while they actively search for new employment.
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