Legal Definitions - unemployment tax

An unemployment tax is a type of tax that is imposed by the government on employers to fund unemployment benefits for workers who have lost their jobs. This tax is usually a percentage of the employee's wages and is paid by the employer.

For example, if an employer has 10 employees and each employee earns $50,000 per year, the employer may be required to pay a certain percentage of that amount as an unemployment tax. This tax is used to fund unemployment benefits for workers who have been laid off or terminated from their jobs.

The purpose of the unemployment tax is to provide financial assistance to workers who have lost their jobs through no fault of their own. This tax helps to ensure that workers have a safety net in case they are unable to find new employment right away.