How much do NY big-lawyers take home after taxes? Forum

[Anonymous User]

I'm a 2L trying to make some post-graduation, debt-repayment plans. I've accepted an SA position with a firm in NY that matches the Cravath scale. Assuming I get an offer at the end of next summer, how much can I expect to take home after paying local/state/federal taxes when I'm a 1st-year associate?

[Anonymous User]

Around 95k if you're single with no dependents, but you'll probably have some deductions your first year that will reduce your taxable income to about 140 so you'll probably wind up around 100 when it's all said and done.

[mvp99]

Around 95k if you're single with no dependents, but you'll probably have some deductions your first year that will reduce your taxable income to about 140 so you'll probably wind up around 100 when it's all said and done.

around 115k because NY -> 190k

[Anonymous User]

Around 95k if you're single with no dependents, but you'll probably have some deductions your first year that will reduce your taxable income to about 140 so you'll probably wind up around 100 when it's all said and done.

Just to be perfectly clear, these figures are taking into account state/local taxes in addition to federal, correct?

[RaceJudicata]

Search google for "take home pay calculator" - these, in my experience, are nearly perfect and take into consideration local taxes (NYC). Also they let you play around adding deductions for rent, 401k, etc to see what net is after those expenses.

[Anonymous User]

Around 95k if you're single with no dependents, but you'll probably have some deductions your first year that will reduce your taxable income to about 140 so you'll probably wind up around 100 when it's all said and done.

Just to be perfectly clear, these figures are taking into account state/local taxes in addition to federal, correct?

Yeah. I just meant that there are certain expenses you'll likely encounter that are tax deductible. For example, if you're changing your permanent residence because of work then you're allowed to deduct the moving costs. Additionally, the interest payments you make on your student loans are tax deductible so depending on how aggressive you're paying them off, you may not have much taxable income. In addition, you're taxed at a 160k/clip in your stub year but only will earn approximately 40k, and therefore only have to pay taxes on the 40k.

But the general safe rule to keep in mind is that you lose more of your 160k to taxes than any other cost.

[Tiago Splitter]

Additionally, the interest payments you make on your student loans are tax deductible so depending on how aggressive you're paying them off, you may not have much taxable income.

This is capped at $2500 a year and is not allowed for people with an AGI over 75k.

[twenty 8]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

[SemperLegal]

Depends. I am assuming you mean your take home pay on payday, not your annual post tax income, otherwise all these factors might not matter.

Single or married? (More if married)
Living in Nyc, nj, or Long island? (Complicated effect depending on martial situation, assets, and residential interest)
Are you going to be participating in a pretax commuting program?(currently up to $250 of commuting costs can be pretax if your employer participates, that's an extra grand a year after your stub year)
Does your firm pay biweekly, monthly, or semi monthly? (Obvious)
Do you use the W4 worksheet, the table, or the calculator? (Use the irs calculator)


Also, your monthly take home will vary throughout the year. You'll likely have a bar loan to pay back at a few hundred a week, you'll have to pay 6.2% ss tax on that first 118,000, but none after (i.e. After September of your non stub year your take home goes up until January 1), and you'll likely have substantial premiums and health savings account contributions that may differ from pay check to pay check.

[SemperLegal]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

They wouldn't because they don't exist. The market accounts for that.

Also, you mean NJ (also high tax, with deductions that greatly differ from feds) or CT (low tax)?

[SemperLegal]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

But, you can save a lot by living in NJ, working in NYC, and being clever with your tax planning.

However, to answer your question, for a single tax payerb with no deductions, it's $1,200 more expensive (tax wise) for NYC over Nj, $2000 cheaper in ct

[twenty 8]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

But, you can save a lot by living in NJ, working in NYC, and being clever with your tax planning.

However, to answer your question, for a single tax payerb with no deductions, it's $1,200 more expensive (tax wise) for NYC over Nj, $2000 cheaper in ct

Thanks. Single. No tuition debt. 401k $1k a month (only because firm matches). Health insurance 100% paid. Not sure if a $1,200 variance makes up for the COL vs. where I am at now (state with no income tax). Not sure if a $20k increase would be worth it, but if pay was 50k more, it could make a difference.

[Anonymous User]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

The city tax is 3.648% in your income bracket so you lose about 6k more being in New York. I'm not sure how many big law firms there are in the suburbs.

[Tiago Splitter]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

The city tax is 3.648% in your income bracket so you lose about 6k more being in New York. I'm not sure how many big law firms there are in the suburbs.

If you itemize you can deduct this on your federal return so the loss isn't quite as bad.

[Anonymous User]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

The city tax is 3.648% in your income bracket so you lose about 6k more being in New York. I'm not sure how many big law firms there are in the suburbs.

If you itemize you can deduct this on your federal return so the loss isn't quite as bad.

Didn't know that so if the 6k can be deducted from your 160 then you're paying approx. 2k less in taxes so are really only losing 4k more working in NYC.

[anonnymouse]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

The city tax is 3.648% in your income bracket so you lose about 6k more being in New York. I'm not sure how many big law firms there are in the suburbs.

If you itemize you can deduct this on your federal return so the loss isn't quite as bad.

Didn't know that so if the 6k can be deducted from your 160 then you're paying approx. 2k less in taxes so are really only losing 4k more working in NYC.

Until you start having to pay AMT. Probably start owing AMT as a 2nd or 3rd year depending on your other deductions.

[SemperLegal]

Given the high NY taxes (both local and state), how much would one save by working at a firm bordering NYC? Using $160 as the metric.

The city tax is 3.648% in your income bracket so you lose about 6k more being in New York. I'm not sure how many big law firms there are in the suburbs.

If you itemize you can deduct this on your federal return so the loss isn't quite as bad.

Itemizing is very rare for biglaw associates, unless you own a house.