The Tax Rates for Minimum Wage | Bizfluent

The Tax Rates for Minimum Wage

Written By
Dani Arbuckle
Dani Arbuckle
Feb 4, 2011
2 minute read

Minimum wage workers may not be big earners but their income won't escape the notice of Uncle Sam. There is a federal minimum wage and some states have their own minimum legal pay. Based on these rates, a full-time minimum wage earner, filing as an individual, will pay somewhere in the area of $2,000 to $2,500 in federal income taxes, before deductions, as of 2015.

Federal Minimum

The federal minimum wage is $7.50 per hour as of 2015. Based on a 40-hour work week, this works out to an annual salary of $15,600. As of 2015 this would mean that a single filer would be paying 10 percent federal income tax on the first $9,075 and 15 percent on the remaining $6,525. That would mean paying $1,886.25 in federal taxes before deductions. A married couple in which only one partner works, for a total annual salary of $15,600, would be taxed at 10 percent, for a total tax of $1,560 before deductions.

Higher Rates

Some states and the District of Columbia have a higher minimum wage than the federal guideline. As of January 2015, the District of Columbia has the highest minimum wage at $9.50 per hour. Based on a 40-hour work week, this works out to $19,760 per year. In 2015 a single filer would pay 10 percent federal income tax on the first $9,075 and 15 percent on the remaining $10,685. In total these minimum wage workers would be taxed $2,510.25 before deductions. A married couple in which only one partner works, for a total wage of $19,760 per year, would be taxed at 10 percent for the entire amount. This equals a pre-deduction tax bill of 1,976.

Dani Arbuckle

Dani Arbuckle is a successful business writer with expertise in general management and strategic management. Arbuckle is also an active runner and marathoner who writes extensively on running and other sports.

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