Gera Tools

Tennessee Employer Payroll Tax Calculator

Compute your total employer payroll tax burden for Tennessee employees.

Calculates the employer-side payroll tax cost for a Tennessee employee: FUTA at 0.6% on the first $7,000, Tennessee SUTA at the new-employer 2.7% rate on the $7,000 wage base, and the employer Social Security and Medicare match.

Does Tennessee have employer state income tax withholding?

No. Tennessee has no state income tax, so there is no state income-tax withholding for employees and no employer-paid state disability (SDI) or paid family and medical leave (PFML) program. Your state obligation is unemployment insurance (SUTA).

Hiring in Tennessee is comparatively simple on the payroll-tax side because Tennessee has no state income tax. There is no state withholding to administer and no state disability or paid-leave program. Your employer-side obligations come down to federal and state unemployment tax plus the federal FICA match. This calculator adds them up so you can budget the true cost of a Tennessee hire.

How it works

The calculator sums four employer-side taxes:

  1. FUTA. Federal unemployment tax is effectively 0.6% (after the standard 5.4% state credit) on the first $7,000 of wages — a maximum of $42 per employee per year.
  2. Tennessee SUTA. State unemployment is charged on Tennessee’s $7,000 taxable wage base. New employers typically pay 2.7%, so up to $189 per employee; experienced employers use their assigned rate.
  3. Social Security match. Employers match 6.2% of wages up to the annual Social Security wage base.
  4. Medicare match. Employers match 1.45% on all wages, with no wage cap.

In formula form: total = FUTA + SUTA + (6.2% Social Security match) + (1.45% Medicare match).

Tips and example

For an employee paid $50,000: FUTA is $42 (0.6% of $7,000), Tennessee SUTA at 2.7% is $189 (2.7% of $7,000), the Social Security match is $3,100 (6.2% of $50,000), and Medicare is $725 (1.45%). The total employer payroll cost above wages is about $4,056.

Note there is no Tennessee state income tax, SDI, or PFML line — those are zero. The biggest variable is your SUTA rate, which becomes experience-rated after your first years, so update that field once Tennessee assigns your employer rate.