$30 An Hour Is How Much a Year?

• 40 hours x 52 weeks = 2,080 hours.

Now we’ve got the total hours worked in a year, all we have to do to get our maximum yearly income is multiply this by the hourly rate of $30:

• 2,080 hours x $30 = $62,400 per year.

So to answer our main question, if you are willing to work a 40-hour week every week of the year, you will bag a gross, pre-tax income of $62,400 for your troubles.

However, since we live in the real world, most people value their sanity enough to take at least two weeks of vacation per year. To get a more accurate total, we should remove two weeks’ worth of hours from the equation and recalculate, that is assuming that you are not paid for your vacation time:

• 2,080 – 80 = 2,000 total hours.
• 2,000 x $30,000 = $60,000 per year.

$30 an Hour – Monthly Income

I’ll be utilizing a monthly metric of four work weeks because many workers receive their salaries in that time frame. Assuming a 40-hour workweek, to get our monthly hours total, all we need to do is multiply this by the number of weeks worked per month:

• 40 hours x 4 weeks = 160 hours worked in a month.

We simply take this total and, once again, multiply it by our $30 rate:

• 160 hours x $30 = $4,800 per month.

$30 an Hour – Weekly Income

For our calculations, we have assumed a working week to total 40 hours. Let’s multiply that by $30 for our gross weekly income:

• 40 hours x $30 = $1,200 per week.

$30 an Hour – Daily Income

We assumed an eight hour working day, so once again, it’s just a matter of multiplying that by our hourly rate:

• 8 hours x $30 = $240 per day.

Actual Income After Tax

Calculating your gross annual income based on a $30 per hour wage is a good start, but it doesn’t reflect the amount you’ll receive after the main taxes have been subtracted. Federal Income Tax, Social Security, Medicare, and additional state taxes will take a significant chunk out of your earnings. Now, let’s calculate precisely how much of your income will be ‘repurposed’ on a $30 per hour wage.

Federal Income Tax

Federal Income Tax will do the most damage. To determine how much taxes you will owe on a $30 per hour wage, assuming you work for all 52 weeks in a year, we need to refer to the relevant Federal Income Tax brackets and perform some basic calculations. As we know, you will earn $62,400 doing this. The table below displays the relevant tax brackets for this income level and the corresponding tax rates for the 2023 tax year:

To get our total, we add up the amount owed from each of these brackets:

• $1,100 + $4,046.88 + $3,888.28 = $9,035.16 due in Federal Income Tax.

FICA Taxes

These comprise of the payments you are forced to make towards Social Security and Medicare. That piece of the pie will account for another 7.65% of your income you will never see again. Let’s work out what that will amount to:

• $62,400 x 0.0765 = $4,773.60 total FICA Taxes.

State Income Tax

Determining your state income tax level is a little trickier. Seven states in the US do not impose any income tax, namely Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. Among the remaining states, some impose a fixed rate irrespective of income, while others have tax brackets with varying rates dependent on income level.

After examining the different rates across the country, I can deduce that if you reside in a state that imposes their own income tax, you’ll pay, on average, around 4.5% of your income. Let’s do the math:

• $62,400 x 0.045 = $2,808 due in state income tax.

Overall Tax Owed

So if our total tax bill is $16,616.76, all we have to do to calculate our take home pay is subtract this amount from our pre-tax gross income of $62,400:

• $62,400 – $16,616.76 = $45,783.24 net income after tax.

To find out what this represents in percentage terms, we have to divide our tax paid by our gross annual income and multiply the result by 100:

• $16,616.76 / $62,400 x 100 = 26.63% of your income paid in taxes.