Question

Jason was a recent graduate from a university program with a BS in Medical Technology. He will begin a position at the local hospital with an annual salary $37,160 (gross). His federal income tax rate is 15%. His state tax rate is 5.7%. His social security tax is 6.2% and his Medicare tax rate is 1.45%. He will have $234.00 taken from his monthly paycheck for life and health insurance before the taxes are taken from his check.

What is Jason’s net annual salary? Show your steps or logic for your answer. Submit your answer in the textbox below.

Answer 1

The net income will be $24613.40

Explanation:

Net salary = gross salary - taxes

Now given is:

Jason's gross annual salary = $37160

So, monthly gross salary = 37160/12= $3096.66

Jason will have $234.00 taken from his monthly paycheck before the taxes apply so we will subtract this value from the monthly salary first, and then apply taxes on the remaining salary. So, value is = 3096.66-234= $2862.66

Now we will calculate monthly deductions :

Federal deduction = 15% ;
`0.15*2862.66=429.40`

State tax deduction = 5.7% ;
`0.057*2862.67=163.17`

Social security tax deduction = 6.2% ;
`0.062*2862.67=177.48`

Medicare tax = 1.45% ;
`0.0145*2862.67=41.50`

So, total deductions in a month are = 234+429.40+163.17+177.48+41.50

= $1045.55

So, total deductions for a year will be =
`1045.55*12=12546.60`

Hence, net income will be = 37160-12546.60 = $24613.40

Answer 2

You have to calculate the deductions and subtrat them from the annual gross salary.

Deductions:

15%*37160
5.7%*37160
6.2%*37160
1.45%*37160
234*12
------------------

Net = 37160 (1 - 0.2835) - 2808 = $23.817,14