Cost of hiring by state · 2026
Payroll tax and hiring cost, all 51 jurisdictions
Employer unemployment-insurance rates and wage bases vary widely by state, and they move the cost of a W-2 hire by thousands of dollars a year. Sort the table, or open any state for a pre-filled calculator and its misclassification rules.
| Income tax | |||
|---|---|---|---|
| Alabama | 2.7% | $8,000 | Yes |
| Alaska | 1% | $51,700 | None |
| Arizona | 2% | $8,000 | Yes |
| Arkansas | 2% | $7,000 | Yes |
| California | 3.4% | $7,000 | Yes |
| Colorado | 1.7% | $27,200 | Yes |
| Connecticut | 2.2% | $26,100 | Yes |
| Delaware | 1% | $12,500 | Yes |
| District of Columbia | 2.7% | $9,000 | Yes |
| Florida | 2.7% | $7,000 | None |
| Georgia | 2.7% | $9,500 | Yes |
| Hawaii | 2.4% | $62,000 | Yes |
| Idaho | 1% | $55,300 | Yes |
| Illinois | 3.65% | $13,916 | Yes |
| Indiana | 2.5% | $9,500 | Yes |
| Iowa | 1% | $39,500 | Yes |
| Kansas | 2.7% | $14,000 | Yes |
| Kentucky | 2.7% | $11,700 | Yes |
| Louisiana | 1.75% | $7,700 | Yes |
| Maine | 2.54% | $12,000 | Yes |
| Maryland | 2.6% | $8,500 | Yes |
| Massachusetts | 2.13% | $15,000 | Yes |
| Michigan | 2.7% | $9,000 | Yes |
| Minnesota | 1% | $43,000 | Yes |
| Mississippi | 1.2% | $14,000 | Yes |
| Missouri | 2.38% | $9,500 | Yes |
| Montana | 1% | $45,100 | Yes |
| Nebraska | 1.25% | $9,000 | Yes |
| Nevada | 3% | $41,800 | None |
| New Hampshire | 1.7% | $14,000 | None |
| New Jersey | 2.8% | $43,300 | Yes |
| New Mexico | 1% | $33,200 | Yes |
| New York | 4.1% | $12,800 | Yes |
| North Carolina | 1% | $32,600 | Yes |
| North Dakota | 1.03% | $45,100 | Yes |
| Ohio | 2.7% | $9,000 | Yes |
| Oklahoma | 1.5% | $28,200 | Yes |
| Oregon | 2.4% | $54,300 | Yes |
| Pennsylvania | 3.82% | $10,000 | Yes |
| Rhode Island | 1.21% | $29,800 | Yes |
| South Carolina | 0.35% | $14,000 | Yes |
| South Dakota | 1.2% | $15,000 | None |
| Tennessee | 2.7% | $7,000 | None |
| Texas | 2.7% | $9,000 | None |
| Utah | 1% | $48,900 | Yes |
| Vermont | 1% | $14,800 | Yes |
| Virginia | 2.5% | $8,000 | Yes |
| Washington | 1% | $72,800 | None |
| West Virginia | 2.7% | $9,500 | Yes |
| Wisconsin | 3.25% | $14,000 | Yes |
| Wyoming | 2.35% | $32,400 | None |
New-employer SUI rates · national average wage base $22,573 · Source: IRS Pub 15 + state unemployment agencies · 2026
How to read these numbers
The SUI rate is the new-employer state unemployment insurance rate — what a business pays on its first hires before it has a claims history. The wage basecaps the wages that rate applies to, so a high rate on a low base can cost less than a low rate on a high base. Nine states levy no income tax on wages, which makes a W-2 paycheck go further for the employee without changing the employer's payroll-tax bill. Open any state to model a specific salary and compare it against a 1099 contract.