[Request] A 2 bedroom apartment on minimum wage. How accurate is this?

That e-how calculation is on crack.

1) First you have to take payroll taxes, which are 7.65% and there are NO exemptions. In some states/counties, you'll pay a little more (usually <1%) for unemployment, worker's comp, etc.

So $15,600 x 92.35% = $14,406.60 maximum take-home pay.

The first $4,000 is your personal exemption, so that leaves $10,406.60 taxable income. But then you get to deductions; let's assume these folks aren't homeowners or philanthropists, so they're taking the standard deduction. The 2015 standard deduction for singles is $6,300, so now your taxable income is $4,106.60.

THAT is what you pay 10% income taxes on. So you get another $410.66 withheld, for a final annual take-home of $14,406.60 - $410.66 = $13,995.94, or $1,166.33/month take-home for a single person making minimum wage FULL TIME who isn't getting any health insurance or retirement taken out. 30% of that is about $350/month rent. Even if you go 50%, which HUD defines as "worst case housing needs," that's $583/month. Rent plus utilities on a two-bedroom is likely to exceed that nearly everywhere.

Now, the reality is, a 40-hour a week, 52-week a year minimum wage job is practically imaginary. Places that pay minimum wage usually limit you to 29 hours, because 30 is where some of the employment protections for "full-time" employees kick in (i.e. ACA requirements). So most people making minimum wage are patching together more than one job, and some weeks they'll work 35 hours, others they'll work 50, and hopefully it averages out.

There's also the point that a person who "needs" a two-bedroom is NOT a single living alone. They're likely looking at single parents, adults with a disabled parent, etc. So that increases the deductions; single-head-of-household deduction is $9,250, so their taxable income would actually be only $1,156.60, and therefore their Federal income tax only $115.66. That's another $295/year in their pocket, $24.58/month, or another $7.38/month they can "afford" in rent. Turns out not to be THAT much.

But then there's also the EITC, which they'll probably qualify for, if they get decent tax help. That might put their take-home at as much as $17,649.94, or $1,470.83/month. That gives you $441.25/month for "affordable" rent, or up to $735.50 for "worst case" housing needs. Then you're left with either $1,029.60 or $735.50 for everything else... groceries for an adult and child, transportation, clothing, health insurance, medical care, school supplies, household supplies... and hope you don't have any big emergencies, because you've nothing to put by for a rainy day.

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