# Fringes

Source: https://storiara.com/glossary/fringes
Last updated: 2026-09-14
Author: Charles Hirschhorn, Storiara

> Fringes are the employer costs that ride on top of wages in a film budget: employer Social Security and Medicare, federal and state unemployment tax, workers' compensation, payroll company fees, and union pension, health, and vacation contributions. They are calculated as percentages or hourly amounts per person and added to every labor line.

## Fringes on a $1,200 week

Take a non-union 2nd AC paid $1,200 for a week, early in the calendar year. The federal pieces are fixed by the IRS: 6.2% employer Social Security, 1.45% employer Medicare, and FUTA at 0.6% after the standard state credit. The state and insurance pieces vary, so the example below plugs in placeholder rates you would replace with your payroll company's quote.

| Fringe | Rate | On $1,200 |
|---|---|---|
| Social Security (employer) | 6.20% | $74.40 |
| Medicare (employer) | 1.45% | $17.40 |
| FUTA (net) | 0.60% | $7.20 |
| State unemployment (example rate) | 3.40% | $40.80 |
| Workers' comp (example rate) | 3.00% | $36.00 |
| Payroll handling fee (example rate) | 0.50% | $6.00 |
| **Total** | **15.15%** | **$181.80** |

So that week costs production $1,200 + $181.80 = $1,381.80. Check the arithmetic the other way: $1,200 x 0.1515 = $181.80.

## Union fringes are built differently

Guild benefits aren't one flat number. SAG-AFTRA performers carry a pension and health contribution as a percentage of gross: 22% for performers and 21.5% for background actors under the 2026 low budget rate sheets, effective September 6, 2026. A Low Budget day player at $834 generates $834 x 0.22 = $183.48 in P&H on top of payroll taxes. IATSE crew benefits under the Basic Agreement go to the Motion Picture Industry Pension and Health Plans as dollar amounts per hour worked or guaranteed, so the fringe on a 60-hour week is larger than on a 50-hour week even at the same rate. See [pension and health](https://storiara.com/glossary/pension-and-health) for how each works.

## Mistakes that throw the total off

The most common error is applying one blended percentage to every line, including equipment rentals, [kit rentals](https://storiara.com/glossary/kit-rental), and [per diem](https://storiara.com/glossary/per-diem), none of which are wages. The second is forgetting that FUTA and state unemployment stop at a wage cap, which makes long-running shows over-budget fringes for crew who hit the cap early. Payments to a [loan-out company](https://storiara.com/glossary/loan-out-company) also skip employer payroll taxes, but union benefits still apply.

## Where fringes show up

In budgeting software, each labor line is tagged with fringe codes (FICA, FUTA, SUI, WC, SAG, IA) and the program totals them by account. Your [payroll company](https://storiara.com/glossary/payroll-company) supplies the current state and comp rates, and the [payroll accountant](https://storiara.com/roles/payroll-accountant) checks that time cards were fringed at the right codes. The [film budget template](https://storiara.com/templates/film-budget) includes a fringe setup block, and [film budget fringes](https://storiara.com/blog/film-budget-fringes) covers state-by-state differences.

## Frequently asked questions

### What is a typical fringe rate for film crew?

It depends on the state, the union agreement, and your payroll company. A non-union crew member's fringe is mostly payroll taxes plus workers' comp and a handling fee. Union members add pension and health, which for SAG-AFTRA performers is a percentage of gross and for IATSE crew is an hourly amount.

### Do you pay fringes on a loan-out?

You don't pay employer payroll taxes on a payment to a loan-out company, because the loan-out is the employer. Union pension and health contributions are still owed on union members paid through a loan-out.

### Do fringes apply to per diem and kit rental?

Generally no. Non-taxable reimbursements and equipment rentals aren't wages, so payroll taxes don't apply. Keep those lines out of the fringe base in your budget.

### Why do fringes drop later in the year?

Some taxes stop at a wage cap. FUTA applies only to the first $7,000 paid to each employee in a year, and Social Security stops at the annual wage base, $184,500 for 2026.

## Sources

- [IRS Topic no. 751, Social Security and Medicare withholding rates](https://www.irs.gov/taxtopics/tc751)
- [IRS Topic no. 759, Form 940 Employer's Annual Federal Unemployment (FUTA) Tax Return](https://www.irs.gov/taxtopics/tc759)
- [SAG-AFTRA 2026 Low Budget Theatrical Agreement Rate Sheet](https://www.sagaftra.org/sites/default/files/LBA%20Rate%20Sheet%2026-30.pdf)