1. Part 1: Earning Statements

2. Working and Earning Earning Statements
Key Ideas
Employee earning statements include information about……………….
gross wages, benefits, taxes and other deductions
Gross vs. Net – define?
Take home pay

3. What is a good wage? Median wage in US 2016
$849 per week or $44,148 per year for a 40-hour work week.
That is before taxes / other deductions

4. men earned a median average of $927 per week while women earned only $758 or 81.8 percent of what males earned. 
ACDC video

5. Deductions
Define….
money that is taken out of an employees gross pay for different purposes
Think of examples of deductions

6. Example: Pete earns a salary of $45,000/year and gets paid every 2 weeks. Then, money is deducted for
health insurance ($100/pay)
401k (10% of gross)
Social Security (7% of gross)
federal income tax (20% of gross) *largest deduction
state income (4% of gross)
local income taxes (2% of gross)

7. Deductions Other Examples: health insurance (medical, dental, vision)
retirement contributions
annuities/loan payments
garnishment (for unpaid child support, owed back taxes, etc.)
taxes - federal, state and local
Social Security, federal income, state income, local income

8. Deductions
Deduction Amount
Gross Income $45,000
Health Ins ($100 per pay)
401 k (10% of gross)
Social Securtity (7% of gross)
Fed.Income Tax (20% of gross)
State Income Tax (4% of gross)
Local Income Tax (2% of gross)
Total Deductions

9. Deductions
Deduction Amount
Gross Income $45,000
Health Ins ($100 per pay)
$2,400
401 k (10% of gross)
$4,500
Social Security (7% of gross)
$3,150
Fed.Income Tax (10% of gross)
$4, see next slide
State Income Tax (2% of gross)
$900
Local Income Tax (1% of gross)
$450
Total Deductions
$15900
Net Income =
I HAVE NOT EATEN YET!
$29,100
= 64.6 % of Gross Income

10. Table 1. Single Taxable Income Tax Brackets and Rates, 2017
Taxable Income Bracket
Tax Owed
10%
$0 to $9,325
10% of Taxable Income
15%
$9,325 to $37,950
$ plus 15% of the excess over $9325
25%
$37,950 to $91,900
$5, plus 25% of the excess over $37,950
28%
$91,900 to $191,650
$18, plus 28% of the excess over $91,900
33%
$191,650 to $416,700
$46, plus 33% of the excess over $191,650
35%
$416,700 to $418,400
$120, plus 35% of the excess over $416,700
39.60%
$418,400+
$121, plus 39.6% of the excess over $418,400

11. ------------------------------------------------------------ $1026
Pay Check Deductions
Federal Income Tax 300
State Income Tax 100
City Income Tax 70
Medicare 25
STRS 300
Health 60
Dental 3
Vision 1
Union 7
403 B 100
Credit Union 60
$1026
Not taxed on this income earned