American living, then and now (1975 vs 2005)

[cercis]

Re: American living, then and now (1975 vs 2005)

Sadly enough the owner after all the bill payments and taxes probably doesn't make much more than his people.

Cicy, I was referring to the owner's actual salary - what s/he had left after all the business expenses. That is what would be figured for census stats as that would be the amount s/he would pay income taxes on.

[cercis]

Re: American living, then and now (1975 vs 2005)

That would be WILDLY wrong.

#

What would be wildly wrong? I'm lost.

[mom-from-missouri]

Re: American living, then and now (1975 vs 2005)

Let me know where you can buy a 3 bedroom house for $195k That is more my price range! Mostly dumps are available for that (if you're lucky) in Jersey.

Move to Missouri--mines for sale!!!! And, its no dump!!!

[cicy33]

Re: American living, then and now (1975 vs 2005)

Cicy, I was referring to the owner's actual salary - what s/he had left after all the business expenses. That is what would be figured for census stats as that would be the amount s/he would pay income taxes on.

Actually I kinda was too. my dh is self employed with one guy. Workers comp and liability alone is high enough. He is in construction and so it is higher for that field. And by the time we pay for his fuel , tools that seem to be always need replaced, and misc expenses that we spend getting the jobs the paycheck just gets smaller and smaller. It is a tough field to be in. self employed I mean. The convenience is worth it though. The bill payments I was referring to are the materials and supplies. not our bills. I just hope that one of his tools doesn't break anytime soon. It is called a Jaybreak and it is very expensive to replace.

[VJW]

Re: American living, then and now (1975 vs 2005)

What would be wildly wrong? I'm lost.

OK.

Well, even after paying the taxes, the take home from $64,272 is still many times the take home from $10,712. Plus, there are many times the benefits as well.

my dh is self employed with one guy. Workers comp and liability alone is high enough. He is in construction and so it is higher for that field. And by the time we pay for his fuel , tools that seem to be always need replaced, and misc expenses that we spend getting the jobs the paycheck just gets smaller and smaller. It is a tough field to be in. self employed I mean. The convenience is worth it though. The bill payments I was referring to are the materials and supplies. not our bills.

Except all of that is deductible, a write-off. Something those employees earning $10,712 cannot do, as most of their spending is on non-deductible necessities.

#

[cercis]

Re: American living, then and now (1975 vs 2005)

Actually I kinda was too. my dh is self employed with one guy. Workers comp and liability alone is high enough. He is in construction and so it is higher for that field. And by the time we pay for his fuel , tools that seem to be always need replaced, and misc expenses that we spend getting the jobs the paycheck just gets smaller and smaller. It is a tough field to be in. self employed I mean. The convenience is worth it though. The bill payments I was referring to are the materials and supplies. not our bills. I just hope that one of his tools doesn't break anytime soon. It is called a Jaybreak and it is very expensive to replace.

All of that should be taken out on the schedule C. After the schedule c is done, then you know your true income. Which is what I was referring to. The TAXABLE income. And if you're paying taxes on all that, you need to change accountants.

[cicy33]

Re: American living, then and now (1975 vs 2005)

OK.

Well, even after paying the taxes, the take home from $64,272 is still many times the take home from $10,712. Plus, there are many times the benefits as well.





Except all of that is deductible, a write-off. Something those employees earning $10,712 cannot do, as most of their spending is on non-deductible necessities.

#

Very true that is a write off but that doesn't mean we get the money back. It just means we have to pay in less taxes off the gross income. For example, my dh's company made approx 68,000 last year. After we paid all the wages and insurance and all that stuff HIS income was approx $25,000. not much better than mine. Our liability and what not is about $2000 per year. If we add more people though it will go up and up. And of course we also pay higher taxes due to the self employment stuff. Of course last year was not a good year. We do pay our guy pretty well. He gets 29% of the job after materials. And actually minimum wage at 40 hours per week is $12,480.00 without figuring in the extra two weeks. Fuel itself is not deductible, mileage is deductible. We can't turn in receipts for $1000 worth of fuel. We turn in our mileage and it is so much per mile. I think that it is 29.5 cents right now. but I could be wrong. Also keep in mind that someone working minimum wage at a regular job has a steady fixed fuel price. His varies wildly because he drives all over. We average around $100 a week for fuel for him right now, before it was around 60 to 70. So we are frequently in the negative if we deducted his actual expenses.

[cercis]

Re: American living, then and now (1975 vs 2005)

Very true that is a write off but that doesn't mean we get the money back. It just means we have to pay in less taxes off the gross income. For example, my dh's company made approx 68,000 last year. After we paid all the wages and insurance and all that stuff HIS income was approx $25,000. not much better than mine. Our liability and what not is about $2000 per year. If we add more people though it will go up and up. And of course we also pay higher taxes due to the self employment stuff. Of course last year was not a good year. We do pay our guy pretty well. He gets 29% of the job after materials. And actually minimum wage at 40 hours per week is $12,480.00 without figuring in the extra two weeks. Fuel itself is not deductible, mileage is deductible. We can't turn in receipts for $1000 worth of fuel. We turn in our mileage and it is so much per mile. I think that it is 29.5 cents right now. but I could be wrong. Also keep in mind that someone working minimum wage at a regular job has a steady fixed fuel price. His varies wildly because he drives all over. We average around $100 a week for fuel for him right now, before it was around 60 to 70. So we are frequently in the negative if we deducted his actual expenses.

I don't think you're understanding my example. I'm speaking SOLELY of the amount that is claimed on income taxes. The amount after all the expenses, etc were deducted. Not the gross amount. So in your dh's case, he makes $25k or so, not $68k or whatever the gross amount would appear to be.

And I don't get $12,480 as actual minimum wage. There are 2,080 hours in a year (40 hrs/wk, 52 wks/year). Last I checked, federal minimum wage is $5.15. Your amount is $6/hr. That's not minimum wage in most US states.

There are many small businesses where, after all expenses, the owner makes well over $60k/year (take, for instance, my bosses who are attorneys. I know they make over $150k/year and the most they pay us is probably $40k/year and I'd say we average about $28k).

And, just in case you missed it, mileage is 48.5 cents/mile (the IRS just passed an emergency measure to raise it). Last year it was something like 36.5.

[cicy33]

Re: American living, then and now (1975 vs 2005)

Actually minimum wage was increased in January to 6.50 per hour. hope that you aren't the one making the 5.15 mark still. I believe that it was nationwide. I actually did become aware of the new mileage rate and am so thrilled. I did miss it! fortunately our accountant (his aunt) won't!

[cercis]

Re: American living, then and now (1975 vs 2005)

Nope, it's still $5.15 http://www.dol.gov/dol/topic/wages/minimumwage.htm

Maybe it's your state, some states have a higher minimum wage, but the fed rate is still $5.15 and that's what it is in Oklahoma and Texas and probably most other states (especially the "red" states).

I make more than minimum wage. I'm actually well paid for a part time worker. And I'm very grateful for that. I love my bosses and I try to tell them as often as possible how much I appreciate the job and my hours.

[mom-from-missouri]

Re: American living, then and now (1975 vs 2005)

Go to http://www.dol.gov/esa/minwage/america.htm
It tells all the state rates.
As of Aug 1, Kansas is $2.65 an hour, and Ohio $2.80 an hour. There are loopholes to minimum wages-such as if you work for a small company and/or get tips.

[cicy33]

Re: American living, then and now (1975 vs 2005)

Thanks for the site, it was an eye opener! I stand fully corrected. Isn't is amazing how you don't realize what other states are paying? How do people live on 2.65 an hour???? That is terrible. even at the old 5.15 we were used to that is too low! Maybe american made products would be better made if their people were better paid!

[jmjj215]

Re: American living, then and now (1975 vs 2005)

Lots of servers make a pretty paltry amount b/c the restuarants they work at don't cater to tippers (no pun intended). However, there are many servers that are "lifers" and make 50-60k. It's a tough job, being on your feet, constantly aware, and you really have to earn a position at these higher-end restaurants - but you can make pretty good money.

[VJW]

Re: American living, then and now (1975 vs 2005)

Very true that is a write off but that doesn't mean we get the money back. It just means we have to pay in less taxes off the gross income.

That’s the advantage of a business, you pretty much can write-off everything that isn’t nailed down, and depreciate what is. It lowers your taxable income, therebye keeping more money in your pocket.

#

[cicy33]

Re: American living, then and now (1975 vs 2005)

I wish we had more to depreciate. His truck is so old that I am afraid that if we depreciate it anymore it will cease to exist! One of these days I would love for him to have a new truck but so far not happening. So far the things we can deduct are: Portion of our home payment, portion of our light bill, his cell phone cost, the money we spent on materials, and mileage. Not sure if I am missing anything.