# RE: Payroll computations

```I'm only looking for rough numbers, not exacts (being off by \$5.00 or \$10.00
is acceptable), since this won't be actually used for peoples paychecks.```
```
George

>-----Original Message-----
>From: Anthony Youngman [mailto:[EMAIL PROTECTED]
>Sent: Friday, February 13, 2004 11:06 AM
>To: U2 Users Discussion List
>Subject: RE: Payroll computations
>
>
>Oh crumbs. We sell software that does EXACTLY that. I might
>even be able
>to email you an out-of-date copy (several years out-of-date ...)
>
>To try and explain how it works ...
>
>We first look at the "first-priority" tax bands, and build an array of
>gross2net at each kink. Let's say you pay 10% on the first 10K, 20% on
>the next 10K, and 30% on the next...
>
>Gross  Net
>0      0
>10K    9K
>20K    17K
>30K    24K
>
>Now let's say that, on your "net of tax" income, you now have to pay 5%
>of the first 10K in health premiums, and 10% of the next 10K.
>
>Gross  Net1   Net2
>0      0
>10K    9K
>       10K    9.5K
>20K    17K
>       20K    19.5K
>30K    24K
>
>For each tax in turn, you now add a new column to the right, and
>extrapolate back to the left. It's easy. That's what our program does.
>And you end up with, in the "gross" column, the exact gross for every
>point at which the marginal tax rate changes.
>
>Our ex-IT-manager once demonstrated this program at a "beauty contest",
>up against one of the big accountancy firm. Their guy didn't
>believe him
>when he said he could do a "net to gross" calculation instantaneously,
>so they tried it. Our program was instant, while you could watch their
>program iterating down towards the correct result :-)
>
>Of course, in truth, our program didn't do it instantly. But
>as you exit
>the "these taxes apply" setup screen, it calculates this table on the
>way out. Then, when you actually enter the net, it simply interpolates
>to get the gross, then does a forward calculation to report all the
>taxes etc.
>
>(By the way, no offence to the others who've replied, but do those
>spreadsheets etc that you've referred to allow you to enter what taxes
>apply? And (as in our case) might George possibly want to use the same
>technique for other countries? After all, he did ask for the technique
>...)
>
>Cheers,
>Wol
>
>-----Original Message-----
>From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED]
>On Behalf Of George Gallen
>Sent: 13 February 2004 15:40
>To: 'Ardent List'
>Subject: Payroll computations
>
>I'm trying to write a program that will give a estimate (fairly close
>estimate)
>for determine what amount of money deducted pre-taxed, will cause your
>taxable income to drop a tax bracket.
>
>What I'm looking for is an excel file for tax rates on salary income.
>I'm assuming you take the gross * (# payperiods in year) for annualized
>salary
>and use that as a base (depending on the # of dependants on the w4)
>would
>give you the % to charge for fed inc tax.
>
>Is that how it works?
>
>(Annualized Salary - pre tax \$) * (% based on dedecutions from table) =
>Fed
>withholding \$
>
>I'm not looking to include state / FICA at this point
>
>Is the above the correct method for determining taxable income for a
>paycheck, and
>if it is via tables where can I get the table in computer readable
>format.
>
>George
>
>George Gallen
>Senior Programmer/Analyst
>Accounting/Data Division
>[EMAIL PROTECTED]
>ph:856.848.1000 Ext 220
>
>SLACK Incorporated - An innovative information, education and
>management
>company
>http://www.slackinc.com
>
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>
>
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```