Hello everyone,
I am planning on studying ChemE so I just wanted to know how much money would I need to pay in taxes assuming that I make 60k a year. I just want to know to see if I can get realistic loans. Thanks.
That will vary depending on a number of factors, such as local and state taxes, dependents, and any other exemptions or credits you qualify for. There are calculators online that you can play around with if you want a ballpark estimate. You should also consider the cost of benefit premiums and 401k or other retirement contributions that may come out of your check.
As someone who does individual tax services, it’s going to be nearly impossible for anyone to give you a quote based off the little bit of information you have said.
Eh, you can estimate and be relatively close. I used PaycheckCity once I got my salary offer, but before I had gotten my first paycheck, and it was a pretty close estimate to what I actually paid in both federal and state taxes (but caveat is also that WA has no state income tax). I used a similar calculator when I lived in NYC, which has a much more complicated tax code, and still got a relatively close estimate. Someone making $60K would probably take home around $4,000 a month, give or take - but that’s the roughest estimate.
If you’re trying to figure out how much to borrow, the general advice I’ve heard is that you shouldn’t borrow more than you expect to make in your first year out of college. However, I am kind of at odds with that advice, because it’s difficult to predict what you’re going to make in your first year out of college - you may change your major, decide to work for a nonprofit, have a difficult time finding a job in your field, do TFA, whatever. Generally speaking, the federal Direct loan limit about (which I think is around $30K) is the recommended max a student should borrow for college.
Taxes aren’t the only issue, of course. The cost of living can vary dramatically from city to city as well. I agree with @juillet – don’t take out more than your federal loans ($27K total over 4 years).
Just use an online calculator. Pick the state you will live in, or if you dont know, choose CA as it is high rate. You want to be conservative. The rest will be available to you, but you will likely need to pay for health insurance at a minimum. Good luck.
Thanks everyone for your advice!
https://smartasset.com/taxes/income-taxes
Here’s a VERY basic calculator; state by state it will vary a lot.
TX you’ll walk home with 47,363; CA you’ll walk home with 44,795.
At “low incomes” you won’t vary more than 5k~, but it goes up a lot.
At 1 million income, you take home 545,515 in CA and 622,240 in TX
I use http://www.smbiz.com/sbrl001.html which summarizes all of the federal taxes. Keep in mind that you won’t work the entire year your first year, but it’s useful to get an idea.
Also so far, social security is 6.2% and medicare is 1.45%.
And don’t forget to deduct a few hundred $ for benefits you will have to pay for. Those will. E deducted.
@HRSMom what do you mean by “benefits you will have to pay for”? Are you referring to Social Security and Medicare taxes, normal living expenses (food, shelter, water, electricity, phone, etc), or something else I’m missing?
No. your employer will deduct health insurance, disability, that sort of thing.
The calculators will have included SS and Medicare already:)
^^^as well as 401K and matching employer contributions
Oh gosh! How much is that usually?
No one can tell you exactly what some of those costs are.
Health insurance fees are based on the package you select. Be careful to not just pick the cheapest one without researching what you may lose. Healthcare costs are huge and if you skimp and have an illness or accident you will fund the excessive medical bills.
State disability insurance depends on your state.
RE 401K: You can opt out, sometimes, on the 401K but some companies won’t let you do that. You can not rely on just SS for retirement, that’s why some companies don’t have the 401 as an option.
Just think like 300 a month for it all and I think you will be under that, but to get an idea, use $300
@HRSMom thank you for the rough estimation. So I should take home about $3,500. Paying about $1000 a month seems reasonable. So $1000 for 1 year is $12,000. $12,000 in debt should be my max. Thank you everyone for your help! @“aunt bea” thank you for your insight.