What does payroll
really cost?
Wages are only part of it. Enter your head count and payroll to see the federal taxes a small business pays on top of wages in 2027, and what it costs to have us run payroll with your books.
Your payroll
Everyone on payroll, including you if you're on it.
Gross pay for everyone, before taxes and deductions.
What the employer pays on top of wages in 2027
- •Social Security: 6.2% of each employee's wages, up to $192,300 a person for 2027 (it was $184,500 in 2026)
- •Medicare: 1.45% of all wages, with no cap
- •Federal unemployment (FUTA): 6.0% of the first $7,000 a person, less a credit of up to 5.4% for state unemployment tax. With the full credit that's 0.6%, or $42 a person
- •State unemployment: your state sets the wage base and your rate, which moves with your history. Pick your state to fill in its wage base and new-employer rate, or enter your own
What the estimate leaves out
It covers the employer's federal payroll taxes, plus state unemployment if you pick your state or enter your rate. It doesn't include state and local income tax withholding (that comes out of the employee's pay), workers' compensation, benefits, retirement contributions or local payroll taxes. The 0.9% Additional Medicare tax on wages over $200,000 is withheld from the employee, with no employer share.
Why payroll comes with the books
Every pay run touches the books: wages, the employer's taxes, the deposits and the quarterly filings all have to agree with the bank. That's why we run payroll as part of a bookkeeping engagement, so the W-2s, the filings and the books tell the same story at year-end.
Common questions
- What payroll taxes does an employer pay?
- On top of wages, the employer pays 6.2% Social Security on each employee's wages up to $192,300 for 2027, 1.45% Medicare on all wages, federal unemployment (FUTA) on the first $7,000 a person, and state unemployment at the rate the state sets.
- Is federal unemployment tax really $42 a person?
- With the full 5.4% credit for state unemployment tax, yes: 0.6% of the first $7,000. In a state that owes the federal unemployment fund, the credit is reduced and FUTA costs more. The Labor Department names those states each November.
- Where do the state unemployment figures come from?
- From each state's unemployment agency. When you pick a state, the estimator fills in its taxable wage base and its rate for new employers, and shows the source and the year. Your own rate depends on your history and is on your state's annual rate notice, so change it if you have it. We update the figures as states publish them.
- Why does it ask for revenue and how my books are kept?
- We run payroll as part of a bookkeeping engagement, so the filings and the books agree. Revenue and books are what our estimate for that engagement is based on.
- Why 2027 rates?
- Because 2027 is the year you're budgeting for. The Social Security wage base for 2027, $192,300, was announced in October 2026. We update the figures every November.
- Why do you ask for my email?
- So we can show you the results and email you this estimate. You'll get a few follow-ups from Jeff. Unsubscribe anytime.
Budget for payroll
before the year starts.
We run payroll with your books for one flat monthly fee, with no hourly charges. Tell us about your business, and we'll confirm a firm monthly price in writing after a 30-minute call.
Educational, not professional advice. This estimate uses the figures and answers you gave and 2027 federal payroll tax rates and our standard pricing, and doesn't account for your full situation. For advice on your business, get in touch. Invisible LLC isn't your accountant until we have an engagement letter.
- Federal employer taxes only, plus state unemployment if you picked your state or entered your rate. State and local taxes, workers' compensation and benefits aren't included.
- It assumes wages are spread evenly across your employees. The Social Security and FUTA wage bases apply to each person, so an uneven payroll changes those lines.
- It's an estimated range, not firm pricing. All businesses are different; your firm monthly price is confirmed in writing after a short scoping call.
- Financial modeling and fractional controller work are scoped separately and aren't included here.