| |
Employer Savings: |
Example: |
Your Numbers: |
| 1. |
Estimated number of employees participating |
53
|
|
| 2. |
Estimated average monthly employee contributions
for their medical, dental and other health insurance
|
$100
|
|
| 3. |
Employer FICA contribution percentage |
7.65% |
% |
| 4. |
Employer's estimated savings per month
|
$405
|
|
| Employer's estimated annual savings |
$4,865 |
|
| |
More Payroll Efficiency: |
| |
Estimated employee incremental tax rate
 Federal income tax
State income tax
FICA tax |
18.00%
5.00%
7.65% |
%
%
% |
| 5. |
Estimated employee incremental income tax rate |
30.65% |
% |
| 6. |
Total pre-tax employee contributions
(Line 1 x Line 2 x 12) |
$63,600 |
|
| 7. |
Employer's estimated increased payroll efficiency
Line 6 / (100% - Line 5) or $63,000 / (100 - 30.65) |
$91,709 |
|
In the example above, the Employer saves $4,865 in payroll taxes each year while at the same time the Employer gets $91,709 more efficient use of the payroll dollars already being spent. In other words, without the Plan, the Employer would have to increase Gross Pay by $91,709 in order to match the employees' increased take-home pay provided under the Plan. |