Paycheck Calculation Basics

• Overview

Gain valuable insights into the complex process of payroll calculations.This topic is designed for persons who are responsible for calculating employee pay manually, testing the validity of the payroll system that calculates employee pay, or responsible for answering questions regarding the calculation of employee pay. This material will help you take away valuable information to ensure you can handle various calculation scenarios with confidence.

Authors

Veronica B. King, CPP, PB, Notary Public, Pay-Pro Business and Consumer Resources

Agenda

Calculating Gross Pay

• Regular Rate of Pay Recap

- Inclusions

- Exclusions

• Components of Gross Pay

- Hourly

- Salary

- Piece Rate

- Commission

- Tip Pay

• Cash vs. Noncash Payments

- Impact on Net Pay

- Examples

Taxes and Other Deductions

• Federal Taxes

- Calculation Types

• FICA(Social Security and Medicare Taxes)

• State Taxes

• Other Deductions

- Voluntary

- Involuntary

• Pre-Taxed vs. Post-Taxed

• Gross Ups

Net Pay Calculation

• Calculating Net Pay

• FLSA Minimum Wage

• Wage Assignment and Other Garnishment Impact

- Disposable Pay