Account for FICA tax when calculating Profit Share Pool #58
Conversation
This file contains bidirectional Unicode text that may be interpreted or compiled differently than what appears below. To review, open the file in an editor that reveals hidden Unicode characters.
Learn more about bidirectional Unicode characters
joshiefishbein
approved these changes
Nov 22, 2019
conordavidson
approved these changes
Nov 25, 2019
aliciakw
approved these changes
Nov 25, 2019
Sign up for free
to join this conversation on GitHub.
Already have an account?
Sign in to comment
Add this suggestion to a batch that can be applied as a single commit.
This suggestion is invalid because no changes were made to the code.
Suggestions cannot be applied while the pull request is closed.
Suggestions cannot be applied while viewing a subset of changes.
Only one suggestion per line can be applied in a batch.
Add this suggestion to a batch that can be applied as a single commit.
Applying suggestions on deleted lines is not supported.
You must change the existing code in this line in order to create a valid suggestion.
Outdated suggestions cannot be applied.
This suggestion has been applied or marked resolved.
Suggestions cannot be applied from pending reviews.
Suggestions cannot be applied on multi-line comments.
Suggestions cannot be applied while the pull request is queued to merge.
Suggestion cannot be applied right now. Please check back later.
In our first two years of sharing profit, I did not account for FICA tax. When paying bonuses (the way we distribute profit share), we were incurring an additional 7.65% fee to pay those bonuses out (roughly an extra $3,901 USD in 2018).
This was an oversight on my behalf when I first wrote the calculator code.
As our profit share pool is growing, this is becoming more important to calculate for. If I didn't account for it, this year (2019) we may end up pay like $8k or $9k extra, which risks our ability to make payroll in January. As such, we now need to absorb that amount in the profit share pool.
https://www.accountingcoach.com/terms/F/federal-insurance-contributions-act
** Please note, the values in this screenshot aren't indicative of anything real