Asked by Gabrielle Gwizdala on Jul 15, 2024

verifed

Verified

Federal unemployment compensation tax becomes an employer's liability at the time the employee is paid.

Unemployment Compensation Tax

A tax paid by employers to fund unemployment benefits for workers who have lost their jobs.

Employer's Liability

Refers to the employer's obligation to compensate employees for injuries and illnesses that occur due to their job.

Employee

An individual who is hired to work for a company or organization in exchange for compensation, typically under an employment agreement.

  • Understand the concept and implications of federal unemployment compensation tax.
verifed

Verified Answer

NM
Nicole MetzlerJul 20, 2024
Final Answer :
True
Explanation :
Federal unemployment compensation tax, also known as FUTA tax, is a tax that employers must pay based on the wages they pay their employees. It becomes the employer's liability at the time the employee is paid, and is reported and paid on the employer's federal tax return.