The calculation of take home pay is the actual amount calculation of how much you will be credited on a job done well.
Step-by-step explanation:
Before calculation, things to be taken care of are -
- Gross pay amount
- Personal exemptions
- Tax status
- Deductions of payroll
Now knowing these much in exact form of amount, we may proceed to calculation -
- The annual income according to the gross pay amount is calculated by simply multiplying the gross pay amount to 12.
- The FICA tax percentage is known according to the tax slab of your annual income, so determine the FICA tax percent amount
- Other Personal Exemptions with Standard Deduction and Pay Roll Deductions are to be calculated
- Sum up all the taxable income and non taxable income separately, and deduct the amount of tax from the taxable income.
- The left over amount now shown is the annual income.
- Divide the annual income after the tax deduction by 12 to know the take home pay for monthly basis.
