$30,000 A Year Is How Much An Hour?
When looking for a job, pay is a big factor in deciding whether or not to apply. Employers in Colorado are now required to include compensation on their job posts, but that is before taxes and doesn’t include any benefits. If one posting is paid by the hour and one is salaried, how do you compare them?
$30,000 A Year Is How Much An Hour?
A annual salary of $30,000, working 40 hours per week (assuming it’s a full-time job of 8 hours per day), will get you $14.71 per hour.
The chart below breaks down an annual salary of $30,000 into what your gross pay would be for common pay periods.
|Pay Period||Gross Pay||Math|
|Hourly||$14.71||$30,000 / 2040 hours|
|Daily||$82.19||$30,000 / 365 days|
|Weekly||$576.92||$30,000 / 52 weeks|
|Biweekly||$1153.85||$30,000 / 52 weeks x 2|
|1st and 15th||$1250||$30,000 / 12 months / 2|
|Monthly||$2500||$30,000 / 12 months|
Even though your gross pay is a line on your pay stub, your net pay is how much you actually get in your bank account. This is after all of your deductions, including contributions to things like retirement accounts, not just taxes. You will have to adjust for your personal contributions and deductions, but the chart below can get you started.
This chart is how much net pay you would receive for each of the common pay periods if you claim zero deductions and file single on your W-4. Based on the effective tax rate for 2021 of approximately 18.99%*. The effective tax rate is the average rate that a person is taxed, because the U.S. uses a progressive tax system with marginal rates. The progressive system in the US means that the first 9950 is always put in the 10% tax bucket, then anything over that up to $40,524 is put in the 12% tax bucket, etc. The rate used here is calculated by adding the effective tax rate, the employee’s social security contribution and the employee’s medicare contribution.
*Formula to get the effective tax rate: [(9950 x .1)+[(30000-9950) x .12]+(30000 x .062)+(30000 x .0145)] / 30000 =.18986667
|Pay Period||Net Pay for Filing Single||Math|
|Hourly||$11.91||($30,000 / 2040 hours) x (1 – .1899)|
|Daily||$66.58||($30,000 / 365 days) x (1 – .1899)|
|Weekly||$467.37||($30,000 / 52 weeks) x (1 – .1899)|
|Biweekly||$934.73||($30,000 / 52 weeks x 2) x (1 – .1899)|
|1st and 15th||$1012.63||($30,000 / 12 months / 2) x (1 – .1899)|
|Monthly||$2025.25||($30,000 / 12 months) x (1 – .1899)|
The numbers above still aren’t exactly what your check will be, because states can also collect income tax. State tax rates vary, but nine states don’t collect any income taxes.
These states are:
- New Hampshire
- South Dakota
Other Factors Affecting Net Pay
Taxes aren’t the only factors that affect net pay. If you contribute to an HSA or FSA, your net pay will be lower, but it will save you money in the long run. If your employer offers reimbursements, that will make your net pay higher.
You can also increase your net pay on your check by increasing the deductions on your W-4. Make sure you can actually take those deductions or you will have to pay them back when you file your taxes.
Converting $30,000 a year into an hourly gross rate is easy, but figuring out how much you will actually take home can get complicated.
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- Colorado Department of Labor and Employment. "Equal Pay for Equal Work Act, Part 2."
- IRS. 2020. "IRS Provides Tax Inflation Adjustments for Tax Year 2021."
- Social Security Administration. "Contribution and Benefit Base."
- Business Insider. 2021. "States With No Income Tax Map."
- CNBC. 2019. "How an FSA or HSA Can Save You Money on Medical Costs."
- IRS. 2021. "Tax Withholding."