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thanks-i think I got a little confused on the 30%. I just talked to my accountant and she thinks I should leave it as is and maybe ask for a raise in January after last quarter..I have experience and she thinks that I should make more . I asked around here of moms that pay nannies and they all said $10-$13/hour.But this is my 1st job as a nanny and their 1st child so we are both trying to figure it out. does that make sense
That's why I wondered whether the 30% you mentioned was your income tax rate.
That might be. Her federal tax rate will depend on her husband's income bracket if they file jointly. If they file separately, her tax rate would be much lower because her earnings are under 20k, but her husband might need her for a dependent so their overall taxes are lower. Regardless, I fear her accountant isn't really crunching the numbers for her because I can't imagine any accountant being kosher with someone not being told her gross earnings rate.
thanks-i think I got a little confused on the 30%. I just talked to my accountant and she thinks I should leave it as is and maybe ask for a raise in January after last quarter..
What I don't understand is how your accountant is okay with you not knowing your gross pay rate. They can't just set $10/hour as your net because your net changes according to your specific tax situation. Your employer can't possibly know your specific tax situation because they don't know your husband's earnings or your deductions. I just think it's super weird for them to say you're net pay rate will be $10. You should be given a gross pay rate. I fear that you misunderstood your employers and that $10/hour is actually your gross pay rate and you'll be taking home less than $320 a week like you expect. And even if they pay you $320 per week, it might not all pan out at tax time----resulting in you owing more in taxes or your employer pocketing the difference for themselves.
thanks for the info- I am not sure what my net should be so I am not sure how to proceed - I am not sure it is worth bringing it up b/c they are quite flexible and laid back and it is a good situation for me. it sounds like it is less than $1 per hour which that does add up quickly- i guess that i will call my accountant tomorrow and see what she says-if she can run the numbers for me and then I can present it to them- I already signed that $10/hr was ok but I can say that i didn't really understand what they paid and what i paid on the taxes...
It's clear that they were planning to pay you under the table until you brought up taxes.
Otherwise, they wouldn't have needed to change your hourly pay rate when you asked them to pay your taxes.
The difference between 10 and 11.50 is 1.50 or $48 per pay (1.50 x 32 hours).
By paying your taxes, they have the additional burden of paying .029 and .062 (which equals .091).
11.60 x 32 hours = 368
368 x .091 = 33.48 (the amount extra they have to pay)
10 x 32 hours = 320 (what they are paying you.)
368 - 320 = 78
78 - 33.48 = 44.52
That means they are withholding 44.52 for your federal, state, local, SUTA and your portion of social security and medicare.
I can't imagine why they would pay additional money you own in taxes if your portion of taxes exceed $44.52.
You'll likely be making less than $10/hour if your taxes exceed $44.52.
And if your taxes are less than $44.52, you're losing out on income because they're keeping it for themselves.
I'm just saying that if you are being paid over the table, you have a right to know your set gross income, not just an arbitrary net like they set.
I will ask them my gross pay tomorrow then go from there and tell them that i researched it and found that they end up paying about .91/hr of (SS and medicare)
they are not paying my federal and state- I am
I have other monthly income so not even sure how that plays into this income..
I will ask them my gross pay tomorrow then go from there and tell them that i researched it and found that they end up paying about .91/hr of (SS and medicare)
they are not paying my federal and state- I am
I have other monthly income so not even sure how that plays into this income.
Your other monthly pay is none of their business and should not be a consideration in whatever package you agree on.
It's clear that they were planning to pay you under the table until you brought up taxes.
Otherwise, they wouldn't have needed to change your hourly pay rate when you asked them to pay your taxes.
The difference between 10 and 11.50 is 1.50 or $48 per pay (1.50 x 32 hours).
By paying your taxes, they have the additional burden of paying .029 and .062 (which equals .091).
11.60 x 32 hours = 368
368 x .091 = 33.48 (the amount extra they have to pay)
10 x 32 hours = 320 (what they are paying you.)
368 - 320 = 78
78 - 33.48 = 44.52
That means they are withholding 44.52 for your federal, state, local, SUTA and your portion of social security and medicare.
I can't imagine why they would pay additional money you own in taxes if your portion of taxes exceed $44.52.
You'll likely be making less than $10/hour if your taxes exceed $44.52.
And if your taxes are less than $44.52, you're losing out on income because they're keeping it for themselves.
I'm just saying that if you are being paid over the table, you have a right to know your set gross income, not just an arbitrary net like they set.
I don't want to confuse the OP and give her a bigger headache than she already has, but if the employer pays all the payroll taxes, it comes out to 6.2% + 4.2% + 2.9% = 13.3%. If the base pay is $11.50 an hour, that is $1.53 per hour, not $0.91. Of that $1.53, the employer's responsibility is $0.88 per hour. That never is taken out of the employee's check. The amount they will pay that is the employee's share is $0.65 per hour ($1.53 - 0.88).
If the employer pays all the payroll taxes, the OP takes home the entire $11.50 per hour less any state and federal tax owed, but gets credit for the Social Security and Medicare just as if it had been withheld from her paycheck. The net effect is she keeps an additional 5.65% of the $11.50. If she works 32 hours per week at $11.50 per hour, that is $368 times 5.65% = $20.79 per week. For income tax purposes, the taxable amount is still $368 per week.
As you say, OP needs to know the gross pay, not the net. We can't know how much the withholding for state and federal tax is without knowing her W4 info. If the employer has included the state and federal tax and come up with a net of $10 per hour based on the W4, then that's what it is. That would be withholding about 13% for state and federal tax.
The bottom line is to require confirmation of the payment of the state and federal withholding, Social Security, and Medicare taxes.
And again, unemployment and workman's comp are all the employer's responsibility. They are never deducted from the employee's wages.
And my question is why has her accountant not crunched these numbers for her?
And again, unemployment and workman's comp are all the employer's responsibility. They are never deducted from the employee's wages.
Employee contributions to SUTA differ state to state. For example, in Pennsylvania, employees contribute a small percentage towards SUTA.
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