FUTA Credit Reduction States
Employers are entitled to a FUTA credit if they paid unemployment taxes to a state government. The FUTA credit is built into IRS Form 940 and is calculated for you if you are filling out the form and correctly following the Form 940 instructions.
But that nice FUTA credit (it’s a credit of .054 % by the way) gets reduced if you paid wages in one of the following states.
You can tell by the higher number for the State of Michigan (.009) that they must really owe a lot of money to the federal government for unemployment.