What is the SUI rate and wage base for new employers in Delaware?

New employers pay unemployment insurance at 1.0% on the first $12,500 of each employee's wages, capping SUI cost at $125 per worker per year. Delaware also levies a 0.2% Operations and Technology supplemental tax on those same SUI wages, which adds up to $25 per employee at the wage base — bringing the combined rate to 1.2% on the first $12,500.

Does Delaware impose a state income tax on employee wages?

Yes. Delaware taxes wage income at the state level, which means employers must withhold Delaware income tax from each paycheck and remit it to the Division of Revenue. This does not increase the employer's direct tax cost, but it adds a payroll-administration obligation for every W-2 hire in the state.

What happens if Delaware classifies a contractor as a misclassified employee?

Delaware uses the ABC test to determine worker status, and misclassification carries serious financial exposure: employers face back unemployment insurance taxes, interest on amounts owed, and civil penalties. Because the ABC test places the burden of proof on the employer, treating a worker as a 1099 contractor without clear documentation of all three prongs is a significant compliance risk.

DE · Payroll tax 2026

The true cost of hiring in Delaware

What a W-2 employee actually costs an employer in Delaware— and how that compares to a 1099 contractor — with the state's real 2026 unemployment-insurance rates built in.

Delaware punches above its weight economically. Wilmington anchors a financial services corridor — credit card issuers, insurance carriers, and trust companies — while the I-95 corridor supports logistics, life sciences, and a growing professional services sector. That corporate concentration means many Delaware employers are hiring white-collar W-2 workers and need exact cost figures before extending an offer. For a new employer, the state SUI rate is 1.0% on the first $12,500 of each worker's wages — a maximum unemployment insurance exposure of $125 per employee per year. On top of that sits a 0.2% Operations and Technology supplemental tax applied to those same SUI wages, adding up to $25 per employee at the wage base. Delaware does impose a state income tax on wages, so employers must withhold and remit accordingly. Add 7.65% in employer-side FICA (Social Security and Medicare), FUTA, and any benefits load, and the total employer cost on a $70,000 salary runs well above that base number. HiringMath calculates the full stack — SUI, FICA, supplemental taxes, and benefits — so you see the real number before signing the offer.

Estimate a Delaware hire

Pre-filled with Delaware's 1% new-employer SUI rate. Adjust salary, benefits, and the 1099 rate to fit your hire.

Fully-loaded W-2 costDelaware

$99,205/yr

1.32× base salary$47.69/hr$24,205 over base

W-2 employee

$99,205

1099 contractor

$75,000

W-2 costs $24,205 more (32.3%) than this contract. Breakeven rate: $99,205.

Annual salary

State

Health insurance/mo

401(k) match

Overhead

1099 contract/yr

New-employer rates · IRS Pub 15DE details

Delaware employer tax facts

Delaware employer payroll-tax rates for 2026
Item	DE	Context
New-employer SUI rate	1%	-1.07% vs national avg 2.07%
SUI taxable wage base	$12,500	national avg $22,573
Federal FICA (employer)	7.65%	6.2% SS + 1.45% Medicare
FUTA	0.6%	max $42 per employee/yr
State income tax on wages	Yes
Worker classification test	ABC test

Source: IRS Pub 15 · Delaware unemployment agency · Updated 2026-06-01

Extra employer taxes: 0.2% Operations & Technology supplemental tax on SUI wages.

Example: a $75,000 hire in Delaware

At a $75,000 base salary with typical benefits, a W-2 employee in Delaware costs an employer $99,205 per year — $24,205 above base pay. An equivalent 1099 contract at $75,000 would cost $24,205 less; the breakeven contract rate is $99,205.

Misclassification risk in Delaware

Test: ABC test

ABC test; back UI taxes, interest, civil penalties.

Penalties by state

Compare nearby rates

Delaware's 1% new-employer SUI rate sits near Alaska (1%), Idaho (1%), Iowa (1%), Minnesota (1%). See the full 51-state comparison or the 2026 employer payroll tax reference.

Delaware hiring-cost FAQ

What is the SUI rate and wage base for new employers in Delaware?: New employers pay unemployment insurance at 1.0% on the first $12,500 of each employee's wages, capping SUI cost at $125 per worker per year. Delaware also levies a 0.2% Operations and Technology supplemental tax on those same SUI wages, which adds up to $25 per employee at the wage base — bringing the combined rate to 1.2% on the first $12,500.
Does Delaware impose a state income tax on employee wages?: Yes. Delaware taxes wage income at the state level, which means employers must withhold Delaware income tax from each paycheck and remit it to the Division of Revenue. This does not increase the employer's direct tax cost, but it adds a payroll-administration obligation for every W-2 hire in the state.
What happens if Delaware classifies a contractor as a misclassified employee?: Delaware uses the ABC test to determine worker status, and misclassification carries serious financial exposure: employers face back unemployment insurance taxes, interest on amounts owed, and civil penalties. Because the ABC test places the burden of proof on the employer, treating a worker as a 1099 contractor without clear documentation of all three prongs is a significant compliance risk.