How do I work out my net pay?
December 1, 2004 1:11 PM Subscribe
I’m thinking about switching jobs, and I’m trying to figure out what my net pay would be, but I’m stumbling a bit… [MI]
(I’m remembering why I hated my accounting courses in college!)
I’m currently an hourly employee, and, as the number of hours per week I work fluctuates greatly, so does my net pay. I’m thinking about moving into a salaried position in another company, and I’m trying to figure out what my net pay would be there. There are some numbers I don’t know and can’t work with (costs related to HMO, dental, parking, etc.), but I’m looking to get a grasp on the amount per paycheck that I should be deducting for taxes.
Using 2004 rates as a assumption, this page tells me that my pay would fall into the 25% category for Federal taxes ($29,051 to $70,350). And this page tells me that my Mass taxes would be 5.3% (as I would be making more than $24,000 a year).
Is it as simple as taking yearly salary, diving by 26 (pay periods per year) and then subtracting 30.3%? Or am I missing something?
(I’m remembering why I hated my accounting courses in college!)
I’m currently an hourly employee, and, as the number of hours per week I work fluctuates greatly, so does my net pay. I’m thinking about moving into a salaried position in another company, and I’m trying to figure out what my net pay would be there. There are some numbers I don’t know and can’t work with (costs related to HMO, dental, parking, etc.), but I’m looking to get a grasp on the amount per paycheck that I should be deducting for taxes.
Using 2004 rates as a assumption, this page tells me that my pay would fall into the 25% category for Federal taxes ($29,051 to $70,350). And this page tells me that my Mass taxes would be 5.3% (as I would be making more than $24,000 a year).
Is it as simple as taking yearly salary, diving by 26 (pay periods per year) and then subtracting 30.3%? Or am I missing something?
Don't forget unemployment, social security,worker's comp, medicare/medicaid, etc. taxes.
Also, don't forget that anything you deduct before taxes (i.e. health insurance, 401k) is going to warp that. Plus, there's the number of deductions you can take.
And if you're closer to the bottom end of that scale, if you own a house or have children or other significant tax credits or deductions, you could end up dropping into a different tax bracket.
With all that being said, I've found that 35% is a safe figure for federal, add state on top of that and you should get a better number.
posted by SpecialK at 1:19 PM on December 1, 2004
Also, don't forget that anything you deduct before taxes (i.e. health insurance, 401k) is going to warp that. Plus, there's the number of deductions you can take.
And if you're closer to the bottom end of that scale, if you own a house or have children or other significant tax credits or deductions, you could end up dropping into a different tax bracket.
With all that being said, I've found that 35% is a safe figure for federal, add state on top of that and you should get a better number.
posted by SpecialK at 1:19 PM on December 1, 2004
Damn, that's what I get for scanning, 12%, that's for us contractors.
If you are going to be salary, you'd end up paying around 7.5% for FICA and Medicare.
posted by madajb at 1:20 PM on December 1, 2004
If you are going to be salary, you'd end up paying around 7.5% for FICA and Medicare.
posted by madajb at 1:20 PM on December 1, 2004
Here you go, I knew I had one of these around somewhere.
posted by madajb at 1:26 PM on December 1, 2004
posted by madajb at 1:26 PM on December 1, 2004
Response by poster: SpecialK - Unfortunately, I'm a single, childless, apartment dweller. Oh well. ;-)
Juicylicious and madajb, thanks for that. I had it in my notes as a "solid" that I knew to deduct...
Madajb... on preview... damn I'm glad I'm not a contractor...
posted by NotMyselfRightNow at 1:27 PM on December 1, 2004
Juicylicious and madajb, thanks for that. I had it in my notes as a "solid" that I knew to deduct...
Madajb... on preview... damn I'm glad I'm not a contractor...
posted by NotMyselfRightNow at 1:27 PM on December 1, 2004
Response by poster: madajb - Thanks for that link. I was trying to find one online that I liked, and couldn't. But this is perfect! (And, cool, my math was right!)
posted by NotMyselfRightNow at 1:30 PM on December 1, 2004
posted by NotMyselfRightNow at 1:30 PM on December 1, 2004
damn I'm glad I'm not a contractor...
It's not as bad as it seems, the 15.4% that is. Because us "contractors" get to take biz expense deductions, which bring the dollar amount down quite a bit.
posted by Juicylicious at 1:33 PM on December 1, 2004
It's not as bad as it seems, the 15.4% that is. Because us "contractors" get to take biz expense deductions, which bring the dollar amount down quite a bit.
posted by Juicylicious at 1:33 PM on December 1, 2004
When estimating pay, I like to deduct %33 from the gross pay and be pleasantly 'surprised' when the net is actually more than that.
posted by soplerfo at 1:39 PM on December 1, 2004
posted by soplerfo at 1:39 PM on December 1, 2004
Actually he did and it is not correct that the 50,000th dollar is taxed at a greater rate. For 2004, the 25% bracket is $29,051 to $70,350, as the poster stated. So, you do bump up 'til you hit $70,351.
posted by Juicylicious at 2:40 PM on December 1, 2004
posted by Juicylicious at 2:40 PM on December 1, 2004
So, you do not bump up 'til you hit $70,351.
/correction
posted by Juicylicious at 3:03 PM on December 1, 2004
/correction
posted by Juicylicious at 3:03 PM on December 1, 2004
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posted by Juicylicious at 1:17 PM on December 1, 2004