$40,000 Salary - US Employer Cost
To employ someone on a $40,000 salary in the US, the total cost to the employer is $43,372 per year. That's +8.4% on top of the gross salary.
$40,000 Employment Cost Breakdown
| Description | Yearly | Monthly |
|---|---|---|
| Gross Salary | $40,000.00 | $3,333.33 |
| Social Security (6.2%) | +$2,480.00 | +$206.67 |
| Medicare (1.45%) | +$580.00 | +$48.33 |
| FUTA (0.6%) | +$42.00 | +$3.50 |
| SUTA (est. 2.7%) | +$270.00 | +$22.50 |
| Total Employer Cost | $43,372.00 | $3,614.33 |
Employer Cost vs Employee Take Home
What the Employer Pays
total cost per year
What the Employee Gets
take home pay per year
The employer pays $9,194 more than what the employee takes home (27% difference)
Adjust 401(k) Match and State
Employee Salary
Enter the gross salary for 2025
Total Employer Cost
What it actually costs to employ someone
Understanding $40,000 Employer Costs
When hiring an employee on a $40,000 salary in the US for 2025, the total cost to the employer is $43,372. This includes the gross salary plus employer payroll taxes including FICA and unemployment insurance.
Employer FICA taxes include Social Security at 6.2% (up to the wage base of $176,100) and Medicare at 1.45%. For a $40,000 salary, employer FICA amounts to $3,060 per year.
Unemployment taxes include FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act). FUTA is effectively 0.6% on the first $7,000 of wages. SUTA rates vary by state and employer experience.
Compare this to the employee's perspective: see the $40,000 take-home pay calculation.