Getting PaidAdvanced Level

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© Take Charge Today –August2013 – Getting Paid– Slide 2Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Good Morning! 3/11/14

• Today’s Agenda:• Learn about paychecks

• Reminder:• Finish test during Raider Rally

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© Take Charge Today –August2013 – Getting Paid– Slide 3Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What are the two primary sources of employment?

What sources of employment do your family members have?

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© Take Charge Today –August2013 – Getting Paid– Slide 4Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Salary vs. Hourly

Would you rather be paid a salary or hourly wage?

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© Take Charge Today –August2013 – Getting Paid– Slide 5Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What methods do employers use to pay employees?

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© Take Charge Today –August2013 – Getting Paid– Slide 6Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Paper Paycheck and Direct Deposit

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© Take Charge Today –August2013 – Getting Paid– Slide 7Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Payroll Card

What method of payment would be best for you?

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© Take Charge Today –August2013 – Getting Paid– Slide 8Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Payroll deductions

Mandatory Optional

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© Take Charge Today –August2013 – Getting Paid– Slide 9Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What are the five main types of taxes?

Withheld from wages

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© Take Charge Today –August2013 – Getting Paid– Slide 10Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Why are income and payroll taxes deducted from wages?

Helps manage tax liability on an ongoing basis(total tax bill)

Beginning of year

End of year –

total tax liability

due

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© Take Charge Today –August2013 – Getting Paid– Slide 11Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What are the mandatory income and payroll tax deductions?

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© Take Charge Today –August2013 – Getting Paid– Slide 12Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Federal Income Tax

Largest required deduction

How do you benefit from paying federal income taxes?

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© Take Charge Today –August2013 – Getting Paid– Slide 13Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What is a Form W-4?

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© Take Charge Today –August2013 – Getting Paid– Slide 14Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Form W-4 Allowances

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© Take Charge Today –August2013 – Getting Paid– Slide 15Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Allowances

Individuals may change their Form W-4 at any time

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© Take Charge Today –August2013 – Getting Paid– Slide 16Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

State Income Tax

Does your state have state income tax?

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© Take Charge Today –August2013 – Getting Paid– Slide 17Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What is Social Security?

• Income for:o Retirees o People with profound

disabilityo Children who have lost

a parento A person with children

who has experienced the death of a spouse

• 6.2%• Up to an annual

maximum• Paid by each worker

and matched by employer

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© Take Charge Today –August2013 – Getting Paid– Slide 18Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What is Medicare?

• Helps pay for health care for individuals 65 and older

• 1.45%• No limit• Paid by each worker

and matched by each employer

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© Take Charge Today –August2013 – Getting Paid– Slide 19Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What are optional payroll deductions?

Employee will typically pay much less than privately purchasing that same

benefit.

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© Take Charge Today –August2013 – Getting Paid– Slide 20Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

How Employers Further Support Employees

Both required at no cost to the employee

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© Take Charge Today –August2013 – Getting Paid– Slide 21Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

How Employers Further Support Employees

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© Take Charge Today –August2013 – Getting Paid– Slide 22Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

What is a pay stub?

Pay stub - outlines the deductions made to wages

Why is it important to review your pay stub?

Employee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 23Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay StubEmployee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 24Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay StubEmployee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

Why is the pay period different than the pay date?

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© Take Charge Today –August2013 – Getting Paid– Slide 25Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay Stub

• Gross income

• Net income

Current Year-to-date (YTD)

Amount this pay period

Amount from January 1 to last day of current pay period

Employee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 26Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay StubEmployee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 27Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay Stub

What are examples of deductions?

Employee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 28Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay Stub

What contributions are included?

Employee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 29Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Pay StubEmployee Information Pay Date: 6/11/2013

Name Identification Number

Address Pay RatePay Period

Joe Beakens 00112233 293 Michael Grove

$15.005/1 – 5/31/2013

Summary

Gross Income Total Personal Deductions

Net Income

Current $2,400.00 $747.00 $1,653.00

YTD $12,000.00 $3,735.00 $8,265.00

Earnings

Type Rate Hours Current YTD

Regular $15.00 160 $2,400.00 $12,000.00

Overtime 0 0 0 0

Deductions

Type Personal Deduction Employer Contribution

Federal income tax $249.40 0

State income tax $100.00 0

Social Security and Medicare $183.60 $183.60

Retirement plan $144.00 $144.00

Health insurance $100.00 $400.00

Workers’ compensation 0 $13.80

Unemployment insurance 0 $6.26

Employee Leave Balances

Type Beginning balance current

Beginning balance YTD

Used Current

Used YTD

Ending Balance

Personal 10 15 0 5 10

Sick 5 5 0 0 5

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© Take Charge Today –August2013 – Getting Paid– Slide 30Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Can an employer pay employees cash?

Ensure employer is deducting income and payroll taxes from wages paid in cash

Consult a tax professional to determine if you should pay taxes on cash earned.

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© Take Charge Today –August2013 – Getting Paid– Slide 31Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Institute at the University of Arizona

Summary