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. Sort the 2026 base rates and planning defaults, or open any state for a calculator where you can enter the rate assigned to your account.
| Income tax | |||
|---|---|---|---|
| Alabama | 2.7% | $8,000 | Yes |
| Alaska | 1% | $54,200 | None |
| Arizona | 2% | $8,000 | Yes |
| Arkansas | 1.8% | $7,000 | Yes |
| California | 3.4% | $7,000 | Yes |
| Colorado | 3.05%* | $30,600 | Yes |
| Connecticut | 1.9% | $27,000 | Yes |
| Delaware | 1% | $14,500 | Yes |
| District of Columbia | 2.7% | $9,000 | Yes |
| Florida | 2.7% | $7,000 | None |
| Georgia | 2.64% | $9,500 | Yes |
| Hawaii | 2.4% | $64,500 | Yes |
| Idaho | 1% | $58,300 | Yes |
| Illinois | 2.8% | $14,250 | Yes |
| Indiana | 2.5% | $9,500 | Yes |
| Iowa | 1% | $20,400 | Yes |
| Kansas | 1.75% | $15,100 | Yes |
| Kentucky | 2.7% | $12,000 | Yes |
| Louisiana | 1.75%* | $7,000 | Yes |
| Maine | 2.23% | $12,000 | Yes |
| Maryland | 2.6% | $8,500 | Yes |
| Massachusetts | 2.42% | $15,000 | Yes |
| Michigan | 2.7% | $9,000 | Yes |
| Minnesota | 1%* | $44,000 | Yes |
| Mississippi | 1% | $14,000 | Yes |
| Missouri | 2.38% | $9,000 | Yes |
| Montana | 1%* | $47,300 | Yes |
| Nebraska | 1.25% | $9,000 | Yes |
| Nevada | 2.95% | $43,700 | None |
| New Hampshire | 2.7% | $14,000 | None |
| New Jersey | 2.8% | $44,800 | Yes |
| New Mexico | 1%* | $34,800 | Yes |
| New York | 4.03% | $17,600 | Yes |
| North Carolina | 1% | $34,200 | Yes |
| North Dakota | 1% | $46,600 | Yes |
| Ohio | 2.7% | $9,000 | Yes |
| Oklahoma | 1.5% | $25,000 | Yes |
| Oregon | 2.4% | $56,700 | Yes |
| Pennsylvania | 3.82% | $10,000 | Yes |
| Rhode Island | 1% | $30,800 | Yes |
| South Carolina | 1% | $14,000 | Yes |
| South Dakota | 1.2% | $15,000 | None |
| Tennessee | 2.7% | $7,000 | None |
| Texas | 2.7% | $9,000 | None |
| Utah | 1%* | $50,700 | Yes |
| Vermont | 1% | $15,400 | Yes |
| Virginia | 2.5% | $8,000 | Yes |
| Washington | 1%* | $78,200 | None |
| West Virginia | 2.7% | $9,500 | Yes |
| Wisconsin | 2.5% | $14,000 | Yes |
| Wyoming | 2.35%* | $33,800 | None |
2026 base rates and industry planning defaults · national average wage base $22,989 · Source: IRS Pub 15 + U.S. DOL
How to read these numbers
The SUI rate is a base new-employer rate or, where a state assigns rates by industry, a clearly marked planning default. Surcharges and account notices can change the actual rate. 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.
Start with the biggest hiring markets — California, Texas, and New York — or compare the extremes: New York carries the highest new-employer SUI rate at 4.03%, while Alaska sits at 1%. For the cross-state picture, use the 2026 payroll-tax reference, read W-2 vs 1099, or run the cost-to-hire calculator.