typically… when factoring someones salary out. How many hours are you basing that on?
what im also wondering…. at what point do you tell your employer… who’s running you at 50 to 60 hrs a week… that this crossing the border of taking advantage of someone.
also. If i tell you I want to take home after taxes 3500.00/month… how do you translate that to gross pay? ( raw numbers, i dont want to factor in benefits just yet)
Obviously I have no experience with an employee, but in needing one Ive talked with a friend, And this is what he said he’d need to take home.
So just in the preliminary stages of trying to do the numbers and figure this out before i Jump in.
Thanks for the help
Replies
take home is after withholding, and that depends on who many dependents you "claim" and each state that has incomrtax wants withholding.
bobl Volo, non valeo
Baloney detecter
Only you can decide the number of hours that constitutes being "taken advantage of". One way to look at it is to take your weekly salary and figure out what it equates to as an hourly wage if you were getting paid time-and-a-half for everything over 40 hours. If it works out to Home Depot wages, you may want to re-think your employment situation.
Regarding the $3,500 takehome, that's probably going to equate to around $4,500-$5,000/month gross, depending on withholdings and on state income tax percentages. Don't forget that on your side, you'll also be paying an additional 7.65% for the employer's cotribution to taxes (say $300-400), as well as paying worker's comp premiums for your employee (easily another $500+ per month, depending on what type of work you do). So, your "$3,500 takehome" guy will end up costing you more like $6k+, without factoring benefits.
Bob
typically... when factoring someones salary out. How many hours are you basing that on?
24/7 for a year. Whether he works it or not.
I try to insure that his weekly pay will be higher than the highest waged person would earn in 40r + 8ot.
As long as his pay is greater than it would be if he was earning min wage with OT, you're legal. Maybe. Check with your accountant.
If your friend will not be a supervisor according to the State and Federal labor laws, you may owe him additional wages if he were to work more than 40 hours a week! Check with your accountant.
You may want to consider putting him on a "garunteed time" pay schedule based on 40 reg hrs + 8 ot hrs and paying him extra when he works more than 48 hours a week. This would mean paying him for 48 even when he only works 1 day that week.
You can limit his "free" paid days by allocating him a number of vacation days and sick days. Then when he takes an extra day off you would shorten his pay that week by 8 hrs ot. if two days off shorten it by 8 reg hrs and 8 OT hrs.
Check out this Payroll Tutorial. Lesson 3, IIRC.
Under a Garunteed Time system, divide 3500 by 4x(40 + (8x1.5)) to get about $16.85/hr take home. Multiply that by 1 + (Tax Rate + 12.7%? (FICA) + other employee contributions). Call it 30% for this example.
This shows about $21.90 / hour. Paying him for 40reg hrs and 8 OT hrs 4 times a month will give him $3500± take home. YOu will still have to pay him extra if he worked more than 8 OT hrs. You could garuntee 166.6 reg hrs/ month + 33.3 OT hrs/ month. Then you might only have to pay extra OT over 33.3 hrs. Check with your accountant.
SamT
when factoring someones salary out. How many hours are you basing that on?
SamT touches on some good information. Sadly, what that means is the answer depends on the legal description of the employee's job. For "salaried, exempt" it's 2080 hours the year. For that rarest of birds, "salaried, non-exempt"--that's frought with all sorts of IRS & State rules to apply.
The next rarest (declared) pay condition is "hourly, exempt" (no matter how many of us are actually paid that way <grr>). The federal guidelines, IIRC, actually say that this category is for certain kinds of managers who would rarely if ever have o/t hours (and with a presumption that there would be some sort of equally speciallized compensation for the o/t). So, that's "versus" 2080 hours a year as well.
That most familiar category, "hourly, non-exempt" can be hard to set a value of hours per year to. I have to admit to liking the suggestion of calcuating the yearly payroll budget versus 365 * 8 hours. (I have used 50 * 6 * 8 [weeks, day, hours] + 80 [vacation time] as a planning figure before.)
what im also wondering.... at what point do you tell your employer... who's running you at 50 to 60 hrs a week... that this crossing the border of taking advantage of someone.
That is a very "sticky wicket." It could be that the boss has over-scheduled the work to "pay" for a long slow winter. It could be the boss is a jerk. It could be that the boss just doesn't know. I've yet to meeta anybody who could reliably draw to that inside straight.
If i tell you I want to take home after taxes 3500.00/month... how do you translate that to gross pay?
Employee side, it's generally safe to multiply "net" (take home) by 1.22 to get an idea of "gross." That, of course depends on how many dependants, whether it crosses a tax bracket, or the like.
When I worked in the hotel industry they thought 50 hours a week for a salaried person was an average week. 60 just meant something came up or you weren't on the ball. 70 was rare but did happen. All for the same salary. DanT
A quick way to estimate is divide your yearly salary by 2000 hrs to get your per hour rate before takes. If one's salary is 50K then he is earning $25/hr based on a 40 hr work week. That is gross pay. Your net pay will depend on your status and dependants. If you want to take home $3500/mo your salary should be around $50K. More if you are single and have no dependants.
I have usually found that takehome runs about 70-75% of Gross as a general quick rule of thumb.