Hello to all....first timer
I have a question about calculating my hourly wage.
As I said in another post, in the past I used a 20% across the board mark up on total job cost.
My business is doing not so great that is why I decided to find out why. After now doing what I should have been doing in the past an Overhead Recovery Analysis
I know why....I was pretty much working for slave wages. ........unbeknownst to me.:confused:
I use Quicken Home & Office for basing my P&L from. I know it is elementary but for
as my needs it serves it's purpose.
Doing my restructuring of my hourly rate, I categorized Indirect and Direct expenses
My questions are: (finally)
I will preface this with saying...I know I am the business and the business is me as far as the IRS is concerned, so these question are about what the customer (my hourly rate) should be billed for and what is fair.
1). Are Self Employee tax and Income Tax considered to be Indirect cost or are they considered Direct cost because they are directly tied to wages?
2). Do I include 100% of both of taxes in my overhead....IE; should the customer be footing the bill on 100% of these taxes
OR...Do I do like an employee and absorb 1/2 the SE Tax in my personal finances.
3). Do I include ANY part of my estimated Income Tax in figuring my hourly rate
4.) Same thing about including a retirement in my hourly rate....If I have a set % that suits me...do I split that between the business overhead and a "personal contribution"?
AGAIN....these questions are geared to what is standard and what is fair to the customer. I know I/Business are paying 100% of these taxes.
In my mind I am thinking, that to be fair to the customer, like employee/ corporation situation and what they would be passing on to their clients.
I do hope these questions make sense....The more I get into the financial part of my business the more I know I don't know. I don't even think I am at Biz 101 yet...more like Biz 98-1/2. :o
I have a question about calculating my hourly wage.
As I said in another post, in the past I used a 20% across the board mark up on total job cost.
My business is doing not so great that is why I decided to find out why. After now doing what I should have been doing in the past an Overhead Recovery Analysis
I know why....I was pretty much working for slave wages. ........unbeknownst to me.:confused:
I use Quicken Home & Office for basing my P&L from. I know it is elementary but for
as my needs it serves it's purpose.
Doing my restructuring of my hourly rate, I categorized Indirect and Direct expenses
My questions are: (finally)
I will preface this with saying...I know I am the business and the business is me as far as the IRS is concerned, so these question are about what the customer (my hourly rate) should be billed for and what is fair.
1). Are Self Employee tax and Income Tax considered to be Indirect cost or are they considered Direct cost because they are directly tied to wages?
2). Do I include 100% of both of taxes in my overhead....IE; should the customer be footing the bill on 100% of these taxes
OR...Do I do like an employee and absorb 1/2 the SE Tax in my personal finances.
3). Do I include ANY part of my estimated Income Tax in figuring my hourly rate
4.) Same thing about including a retirement in my hourly rate....If I have a set % that suits me...do I split that between the business overhead and a "personal contribution"?
AGAIN....these questions are geared to what is standard and what is fair to the customer. I know I/Business are paying 100% of these taxes.
In my mind I am thinking, that to be fair to the customer, like employee/ corporation situation and what they would be passing on to their clients.
I do hope these questions make sense....The more I get into the financial part of my business the more I know I don't know. I don't even think I am at Biz 101 yet...more like Biz 98-1/2. :o
via Small-Business-Forum.net http://www.small-business-forum.net/accounting-taxes/9696-evaluating-hourly-rate.html
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