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Hi Sharks, I have an offer from Pwc SDC bangalore and they are providing permanent wfh. But they have not given this in writing. can anyone whi is already working at pwc tell us ? Are they gonna cal to office next year or not ? Since i might need to shift location !!! Which will be hectic !! PwC PwC India Pwc AC
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Take 20% off of the partner draw and you have a reasonably good approximation of W2 salary. The full process medical alone is 10%+, depending on the size of your family. Then you add the employer FICA, phantom income and passed through expenses that you can't deduct and it all adds up.
Great to know. Thank you AP1! Hoping to get there one day and don’t want to be surprised if I do make it
Every partner I’ve talked to says it’s worse. Health care, taxes, etc. I’ll hear stuff all the time about MDs with high salaries and the comment will be like “and it’s W-2 so better than a partner at that comp”
Partner comp and retirement benefits more than make up for healthcare costs and “cost” of k1 vs w2.
K-1 partners pay both the employee and employer portions of social security and medicare taxes. A W-2 employee pays only the employee portion. The employer portion on Social security is 6.2% on up to $176,100 and medicare is 1.45% no cap, so you do the math there.
Partners may be required to pay the full cost of health insurance premiums, while the employer pays a portion of these costs for w-2 employees.
There are some tax benefits to offset these added costs a little but not enough to offset. In the early years of becoming a partner this can definitely be surprising and your take home pay may not be what you expected if you were unaware of this.
Going forward, it will be even worse given PTET limitations in the new tax bill.
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What PWC2 said.
Why aren't they W2?
Partners can’t be employees of their own partnership.
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More than $700k in W2 since they can deduct expenses…
They have to pay SE tax and (all) state taxes. So their take home pay is less.
Edit: they also don’t get 401k/pension/other employee benefits