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TakeHome Pay Calculation Copyright 1989,90 All Rights Reserved Version 3.62 Programmed by R. G. Farnam P. O. Box 333 Barker, TX 77413-0333 CompuServe 71350,1375 Tax ID Furnished On Request To Businesses or Government Agencies Tax Tables Installed For Use During 1991 INTRODUCTION TakeHome was created as a way determine a quick "what-if" scenario when changing withholding exemptions. I wanted to know what the tax withheld and the amount of take-home pay would be if I were to make a change with my employer for withholding tax purposes. Along these lines, it has developed into a tool for individuals and businesses alike. INDIVIDUALS TakeHome can be used to create several "what-if" situations. After you have entered your current payroll information taken from your pay-stub, you can determine how much federal (and optionally state and local) tax would be withheld from your paycheck. You will be able to list up to 15 ranges on each listing (i.e. from single or married with 0-15 exemptions, 16-31, etc.). With this information, you can fine-tune your withholding allowances to meet your tax liability without giving the government an interest free loan of your tax money. There are benefit plans (401-K and Section 125) that will reduce your tax liability at the end of each year. TakeHome will show you the effect of these plans on your monthly income if you participate in them. Getting a pay raise? TakeHome lets you see just how much take-home pay you will get before you receive your first check! Finally, you will be able to check up on your employer to make sure that the proper amount of withholding is being taken out of your paycheck each pay period. SMALL BUSINESSES TakeHome takes the headache out of going thru the tax tables at payroll time. The program produces a customized pay-stub for you to attach to the checks you give to your employees. If you are operating with a manual payroll system, keeping a ledger account on each employee for W-2 purposes, you can produce more than one copy of the pay stub, either posting directly yourself (if you keep your own books) or giving it to your bookkeeper to post. TakeHome should help you breeze through your payroll duties. LARGE CORPORATIONS Even though your payroll may be computerized, there are many occasions (performance awards, vacation pay, bonuses, employees terminating before the end of the pay period, etc.) when payments will be made to employees between your normal payroll processing. You can compute the employees' taxes and create pay-stubs for such occassions by using TakeHome. Have you ever been plagued with requests from employees wanting to know what effect various exemptions would have upon their take-home pay? TakeHome is a payroll department's dream solution. You can strategically locate copies of TakeHome on computers throughout the company so that employees can do their own "dirty work" and figure it out for themselves! TakeHome is currently in use by several Fortune 500 companies and has been a beneficial relief to their Payroll Departments. TABLE OF CONTENTS Introduction . . . . . . . . . . . . . . . . 2 ShareWare . . . . . . . . . . . . . . . . . 4 Limited Warranty . . . . . . . . . . . . . . 4 Getting Started . . . . . . . . . . . . . . 5 System Requirements Files Included Installing TakeHome Program Operation . . . . . . . . . . . . . 6 Starting TakeHome . . . . . . . . . . . 6 Enter Command . . . . . . . . . . . . . 6 Gross Pay Federal Exemption Status State Exemption Status Local Status State Income Tax Section 125 Deductions 401-K Deductions Other Deductions Change Command . . . . . . . . . . . . . 8 Wipe Command . . . . . . . . . . . . . . 8 PayCalc Command . . . . . . . . . . . . 8 Salaried Employee . . . . . . . . . 8 Hourly Employee . . . . . . . . . . 9 Dependent Command . . . . . . . . . . . 10 401-K Command . . . . . . . . . . . . . 11 Tables Command . . . . . . . . . . . . . 11 MakeStub Command . . . . . . . . . . . . 12 Help Command . . . . . . . . . . . . . . 13 Register Command . . . . . . . . . . . . 13 Shell Command . . . . . . . . . . . . . 13 Quit Command . . . . . . . . . . . . . . 13 Acknowledgements . . . . . . . . . . . . . . 14 About the Author . . . . . . . . . . . . . . 14 SHAREWARE TakeHome is being distributed under the SHAREWARE distribution method. You can try it before you buy it! You are granted a limited license to use TakeHome for a two week period. If after two weeks you are still using TakeHome or have future plans for the occassional use of TakeHome, you are expected to pay for it. Many hours of programming and de-bugging have gone into the program. To register, simply choose the register option within the TakeHome program. You will be asked questions for the completion of the form and the completed form will be printed out on your printer. (You can optionally print out the ORDER.FRM file) Since TakeHome is marketed as ShareWare, only your conscience can be your guide. "There ain't such a thing as a `free' lunch anymore!" WHAT DO YOU GET BY REGISTERING? 1. You will receive your own serialized copy of the latest version of TakeHome which by-passes ShareWare notices and has features not available in the ShareWare version. 2. You will receive a printed manual for the program's use. 3. You will be notified of future up-grades of TakeHome. 4. You will have the option (for a slight additional fee) of having your TakeHome program customized for the automatic computation of any state and/or local payroll taxes in your locality (limited to the 50 United States). 5. The registered version of the program will save a run- time configuration file, as well as, individual data that has been entered. It will also append an output file which can be incorporated into a Lotus 123 program to accumulate data. 6. Site-licenses are available at a reduced cost for putting TakeHome on PC's throughout your company. 7. See the UPDATE.HST file for other registered benefits. DISCLAIMER TakeHome is being provided "AS-IS" with no product warranty, either expressed or implied; including, but not limited to the implied warranties of merchantability and fitness for a particular purpose. TakeHome is guaranteed by the author that the original program is free of any known "virus" and/or "trojan horse" source code; however, since tampering by third parties is always a possibility with any public access software, in no event will the author be responsible for any damages which may occur with the use of this program. The source code for TakeHome is not and will not be released to the public for program integrity reasons as stated above. TakeHome has been tested on IBM (including the PS2 series), Compaq, AT&T, and IBM Compatibles. Some video cards may not work properly with TakeHome and the program should be aborted if this occurs. TakeHome Payroll Program Page -4- GETTING STARTED SYSTEM REQUIREMENTS 1. DOS Version 2.1 or higher 2. A minimum of 256K free memory to devote to TakeHome (Registered version should have 384K) 3. Floppy disk drive (hard disk allows faster access) 4. Color (CGA, EGA, VGA) or Monochrome Monitor 5. ANSI Driver should be active in your CONFIG.SYS file. (If the ANSI.SYS or equivalent is not present in your computers environment, the title screen of TakeHome will appear as so much garbage. If you do not have ANSI, remove the file TAKE2.000 from your disk or directory. You will receive a `File Not Found' error message, but TakeHome will function normally after that.) FILES INCLUDED WITH TakeHome: FILE NAME SIZE DESCRIPTION ~~~~~~~~~~~~ ~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ TAKEHOME.EXE 175,940 Main Program File PAYCALCA.EXE 69,924 Main Program Support File TAKE2.000 8,042 Title Screen HARD.COM 4,023 Hard Disk installation TAKEHOME.DOC (text) This Document File you are reading ORDER.FRM (text) Optional order form to fill out UPDATE.HST (text) A history of program updates COMISION.DOC (text) Commission and Spreadsheet docs UPDATE.40 (text) Version 4.0 enhancements FILES CREATED BY TakeHome PAY.BAT Created during hard disk installation TAKEHOME.??? Temporary work file created and deleted during the programs "CHANGE COMMAND" INSTALLING TAKEHOME TakeHome will run from either a floppy diskette or from a hard drive. The use of a hard drive will speed up TakeHome's disk access and will make the program run faster. The program comes with a hard disk installation file (HARD.BAT) which will do the following for you: * Create a subdirectory called PAYROLL * Copy the program files into this subdirectory * Copy PAY.BAT into your root directory for starting TakeHome from any directory on your disk Optionally, TakeHome can be copied onto your hard disk in the directory of your choice. The program only needs the TAKEHOME.EXE, PAYCALCA.EXE, and TAKE2.000 in the same directory (DO NOT RENAME PAYCALCA.EXE) for the proper execution of TakeHome. That's all there is to it! You are now ready to run TakeHome with either the command PAY, if you used the hard disk installation or TakeHome if you copied the program to your hard disk or are running the program from your floppy diskette. TakeHome Payroll Program Page -5- PROGRAM OPERATION TakeHome was designed to be user friendly. Most users don't care to read a long documentation file. If you are one of these types of individuals, go ahead and start the program! TakeHome is menu driven and there are many "help" screens along the way. When all else fails, you can always read the manual! Data entry other than Yes or No will present a maximum character input in the upper right hand corner of your screen. If you have not pressed the Enter key by the time the counter reaches 0, then TakeHome will stop taking input and place what you have entered on the screen. STARTING TAKEHOME Start TakeHome from the DOS prompt by either typing in PAY, if you used the hard disk installation, or TakeHome from the floppy disk or directory that the program files are located in. After the title screen, an opening screen will give you some ShareWare information on TakeHome, press any key to continue. You will first be asked if you are running the program with a color or monochrome screen; select "C" for color or "M" for monochrome. This will take you to TakeHome's main menu. Options on the main menu are produced "Lotus" style at the top of the screen. Simply use your arrow direction keys to select the option of your choice. (NOTE: Some of the options will not function until payroll information has been entered into the program under the "Enter" option.) Currently, options cannot be selected by pressing the first letter of the option desired. I hope to be able to incorporate letter selection in future upgrades. ENTER COMMAND ENTER brings you to the pay information screen. GROSS PAY is the first question asked by the program. TakeHome will not compute the gross pay for an individual (with the exception of a monthly salaried employee who only works for part of the month). You may enter any value up to $999,999.99 as the gross pay that you are working with. FEDERAL DEPENDENT STATUS is the next screen. Your dependent status needs to be put into code form made up of 3 characters. The first character is either S for single (or married but withhold at the higher single rate) or M for married. The second two must contain your number of exemptions that you are claiming. These can range from 0 to 99; both digits must be used. Therefore, if you are claiming single with no exemptions, you would enter S00 as the status code. Married with 3 exemptions would be entered as M03. STATE DEPENDENT STATUS (registered versions only) will be asked next. The code is entered like the Federal dependent status code above. This portion works on "customized" registered versions only since there are no state tax tables built into TakeHome's ShareWare version. TakeHome Payroll Program Page -6- SECTION 125 DEDUCTIONS are certain pre-tax benefit plans that the employee does not pay FICA or Federal/State taxes for contributions to these plans. Examples include group health insurance, dependent care, medical payments not covered by insurance, etc. Your company must have a fully Qualified plan before deductions can be entered as Section 125 deductions. If your company does not participate in such plans or you do not have any Section 125 deduction, press the enter key to continue, otherwise, enter your total Section 125 deductions here. 401-K DEDUCTIONS are pre-tax savings plans that some companies offer to their employees. 401-K deductions do not have Federal/State taxes, but they are fully FICA taxable. Again, your company must have a fully Qualified plan before an amount can be entered here. If your company does not have such a plan or you do not participate in the 401-K plan, press enter to continue. If you do have this deduction, enter it here. OTHER DEDUCTIONS are entered next. Press "Y" if you want to record other deductions (i.e. Credit Union, Donations, other health or savings deductions not covered under the Section 125 or 401-K plans, Union Dues, etc) Press "N" if you are finished and have no other deductions. Assuming you pressed "Y", an other deductions screen appears. You may list up to a total of 9 other deductions. The first item you will enter is the name of the deduction, followed by the dollar amount entry. You may continue putting in the other deductions until you have reached the maximum (9) entries or you can quit the other deductions screen by pressing Enter at the deduction name prompt Any deduction entered as a negative amount (for example, -10.59) adds the deduction amount to the paycheck instead of subtracting it - AFTER taxes. This is useful in case you are refunding a deduction that was previously overcollected. After all the payroll information has been entered, you will be returned to the main menu screen of TakeHome. The information entered displays on the right hand side of your screen. The bottom status line changes from "No Data Input" to show you which tax table is currently being used to calculate your taxes, your Federal status code for the tax calculation, and your State status code (customized version only). TakeHome Payroll Program Page -7- CHANGE COMMAND This command takes the place of the "enter" command after payroll data has been entered. From this command, you are taken to a screen showing your gross pay input, Federal exemption code, State exemption code (registered versions) or state tax calculated, Section 125 deduction, 401-K deduction or total other deductions. Using the arrow keys or the first letter on the line, select the entry you want to change and a change screen appears for that entry only so that you do not have to re-enter all of the data. You may optionally select the change all to re-enter all data. When you are satisified with your changes, select the keep these values to return to the main menu. WIPE COMMAND The wipe command clears all data that was input with the enter command. If you want to enter a new set of data, use the wipe command first. This will reset all values to zero and return the "enter" command prompt. PAYCALC COMMAND The paycalc command allows you to compute what a monthly salaried employee should be paid when they work a partial month. Additional (new with version 3.5), TakeHome now calculates the gross pay for an hourly employee. After you have selected the paycalc command, three options are displayed. Select one of these options by using the arrow key and pressing Enter or by pressing the first letter on each command line. SALARIED PAY FOR A PARTIAL MONTH GROSS PAY needs the full monthly salaried rate entered into it. After this amount has been entered you will be shown the calculation of the employee's daily rate of pay. WORKDAYS IN MONTH needs to then be determined. A set of calendars (last month, this month, and next month) pops up to assist in your determination of the number of normal workdays. In order for these calendars to be the correct ones, you need to make sure that the date set in your computer is the current date. Paid holidays, sick leave, vacation time-off, etc. are counted as workdays in this computation, but weekends are not counted. There are normally between 20 and 23 workdays per month which is all that TakeHome will correctly compute the amount on. DAYS ACTUALLY WORKED prompts for the number of workdays in the month. The calendars remain visible until this entry has been made. Days entered should be in half day increments; therefore, if the employee worked until noon one day, the decimal .5 should be added to the total number of whole days worked. TakeHome Payroll Program Page -8- TakeHome then calculates the employees gross pay for the month. The calculation used by TakeHome is based on 260 possible working days in any year (this includes any holidays as work days and takes into consideration whether the employee was paid for the holiday or not). This method averages out over the period of a year and should be made applicable even if it is February with only 28 days or July with 31 days. OTHER DOLLAR AMOUNTS paid in addition to this amount can be entered. This should be an entry, if any, of the total overtime, vacation for days not taken, severance pay or any other types of pay you want to enter. TakeHome then asks if you want to go directly to the data entry screens or return to the Main menu. If you have not previously entered the payroll data into the program, TakeHome gives you the total amount computed along with any additional pay that you have entered. This amount should be entered as your gross pay on the data entry screen. If you previously entered the payroll data, TakeHome then returns you to the main screen of the program, automatically plugging in the new calculated value as the gross pay and recomputes the FICA, Federal and State (customized version) taxes to be displayed. HOURLY PAY CALCULATION HOURLY RATE is the starting point for data entry under this option. After you have entered the hourly rate, a popup menu will accept the hours worked. You can select the hours entry using either the arrow key and pressing Enter, or you can press the number or letter of the option that you want to change. Note that the hourly rate can also be changed with the [R] option. 1 - STRAIGHT TIME HOURS. Enter the total hours worked at the regular hourly rate. 2 - OVERTIME HOURS @ 1.5. Enter the total hours worked at the overtime rate of time and one-half. 3 - OVERTIME HOURS @ 2. Enter the total hours worked at the double time rate. 4 - OVERTIME HOURS @ 2.5. Enter the total hours worked at double time and one-half. R - HOURLY RATE CHANGE. Change your original input for the hourly rate. C - CALCULATE. When you are satisified that the hourly rate and the number of hours at each level are correct, select this option to do that actual calculation. The applicable rates along with the dollar value at those rates will display. TakeHome Payroll Program Page -9- After the calculation has been made, you are given the option to either change what was just entered or continue with the program. Next, you are given the option to enter any additional pay that you want added to the gross pay. This would be used for items such as vacation pay, commissions, bonuses, etc. After this entry, if any, you may enter the other payroll information that is input through the Enter command or the total calculated value appears. If other payroll information has been previously entered, TakeHome "plugs" in the calculated amount and recomputes the associated taxes and deductions. DEPENDENT COMMAND The dependent command was the original concept behind the TakeHome program. This command can only be accessed after data has been entered into the program. This section of the program creates a "what if" situation. For example, what if I claimed Married and 3 exemptions instead of Married and 2 exemptions? How much would be taken out of my paycheck for Federal and State (customized) and Local (customized) withholding taxes? With this command, you can easily find out! FEDERAL MARITAL STATUS of "S" for single or "M" for married is entered at the first prompt. Any other characters will cause an input error and TakeHome will ask you to re-enter the marital status. STATE MARITAL STATUS (customized versions only) will be prompted. You may use the same status that you used for the Federal marital status, or you can change to the other one (i.e. if you are claiming married as your Federal status for the comparison, and you want more State tax to be withheld than the state married tables will calculate, then you could claim single for comparison purposes). STARTING POINT for the comparison of exemption ranges may be from 0 to 99. Simply enter the number you want the comparison to start at. Negative numbers are not valid. ENDING POINT for the comparison. This can be any number from 1 to 15 above the starting point up to the number 99. A limit of 15 is imposed by TakeHome since the screen will fill with your tax information, but would scroll off if a larger number were selected. If you need a larger comparison, just run the comparison again. Again, negative numbers will not be accepted on this line. TakeHome Payroll Program Page -10- The TakeHome screen then clears and presents you with the information requested. For each exemption claimed, you are given the amount of Federal Withholding Tax, the State Withholding Tax (customized versions) and your net takehome pay for each exemption. NOTE: The take-home pay will only be accurate if you included all of your payroll deductions in the first data entry panel. State tax calculations will be fixed at your set amount if you do not have a customized version. If you received `**' next to the withholding exemptions, this is an indicator that a copy of your W-4 form will be mailed by your employer to the I.R.S. You have exceeded the current limit on employer reporting to the I.R.S. Your employer will still accept the number of allowances you have claimed, but you may be hearing from `Uncle Sam' to prove that you are entitled to that many exemptions. PRINT COMPARISON is the next prompted. If you want the comparison data shown on your screen to be sent to your printer, reply by pressing the "Y" key (make sure your printer is turned on). Otherwise press the "N" key. ANOTHER COMPARISON is the next prompt. If you would like to enter another set of ranges for your exemption comparison, press the "Y" key. Pressing the "N" key returns you to Pay- Calc's main menu. 401-K COMMAND 401-K is another "what if" situation. Many companies now offer 401-K plans, which are meant to be retirement savings plans, to their employees. If your company offers such a plan, this comparison will show you the tax savings from each pay check that you would receive if you were to put your savings into the 401-K plan instead of a regular savings account. This command only works if payroll data has been entered previously into the program. There are no other entries for this comparison. You will be shown the payroll tax savings for each whole percent from 1 to 16 that you would benefit from if you participated in your employer's 401-K plan. TABLES COMMAND The tables command is used to change the tax tables that TakeHome uses to compute your payroll taxes. You should select your pay period from the tables for TakeHome to accurately calculate your payroll taxes. TakeHome Payroll Program Page -11- MONTHLY - If your taxes are calculated 12 times a year. This is TakeHome's default mode. Some companies pay twice a month, but the taxes are only calculated once a month with the first check of the month being considered an advance. SEMI-MONTHLY - If you are paid twice a month and your taxes are calculated with each check. BI-WEEKLY - If you are paid 26 times a year, receiving your paycheck every two weeks. WEEKLY - If you are paid 52 time a year, so that you receive your check every week. DAILY/MISC - If you are paid in a category that does not fall in one of the above. LUMP-SUM DISTRIBUTION - If you make a payment to an employee over and above their normal payperiod, this method should be chosen. This processes the Federal tax at a flat 20 percent of the gross pay. MAKESTUB COMMAND The Makestub command allows you to print a customized pay- stub on your printer. Values used on the stub will default to TakeHome's calculations, but may be over-ridden if it is necessary. [A] Use this option to enter the employee's name that you want printed on the stub. [B] Enters the employee's social security number on the stub. Enter the full nine digits of the number without any hyphens (TakeHome places them on the stub for you). [C] The period ending should be entered in the manner of either xx-xx-xx or xx/xx/xx for the month, day and year. [D] This option overrides the FICA tax on the stub. If an employee has reached the FICA tax limit for the year, this option should be set to zero so no additional tax is collected. [E] This option overrides the Federal income tax being withheld on the pay-stub. [F] This option overridea the State income tax being withheld on the pay-stub. [G] This option overrides any local tax that TakeHome has calculated. [H] This option inserts your company name on the pay-stub. TakeHome Payroll Program Page -12- [P] This option actually prints the stub(s). You may select as many copies of the stub up to 99 as you have a need for. Enter 0 copies if you decide you are not ready to print yet. [X] Exits the Print menu and returns to TakeHome's main menu. HELP COMMAND Help displays a brief set of instructions to use as a quick reference for the main menu commands. Try looking at this help facility before coming back to the doc file. REGISTER COMMAND By selecting the Register command, you can enter TakeHomes' Registration program. This will allow you to have a customized program made for you. Just follow the prompts and answer the questions. The program will then print it out on your printer and also print it to a disk file (if you want to make changes, you can edit it with an ASCII processor). SHELL COMMAND The Shell command can be used to keep TakeHome in your computers memory while you access another program, provided you have enough memory to run the other program. You may need to look up some information to enter into TakeHome, but don't want to lose the information you have already entered. This is an example for the use of the Shell command. Shell will return you to the DOS prompt. To go back to TakeHome, type EXIT at the DOS prompt and TakeHome's main menu appears with your information intact. QUIT COMMAND The saddest of all commands! When you are finished with TakeHome, select the Quit command. You are given the total amount of time that TakeHome has been running on your PC. TakeHome Payroll Program Page -13- ACKNOWLEDGEMENTS TakeHome was programmed using QuickBASIC Version 3.0. Many thanks to Dave Evers for his Window Tools routines which are used extensively throughout this program. The following are Registered Trademarks used in this documentation: IBM - International Business Machines Corporation Compaq - The Compaq Corporation AT&T - American Telephone and Telegraph Lotus - Lotus Development Corporation QuickBASIC - Microsoft Corporation Fortune 500 - Fortune Magazine ABOUT THE AUTHOR The author of TakeHome has been working in the Payroll area for the past thirteen plus years. He is currently a member of the American Payroll Association. Any correspondence should be directed to: (713) 588-3535 R. Gene Farnam P. O. Box 333 Barker, TX 77413-0333