per diem... 3

[Gymmeh]

I am sure this is covered somewhere on this fora but I can’t find it with the wonderful search tool…

So I have been looking at jobs like crazy, and dabbling in the idea of contracting… but I don’t understand per diem, because the numbers don’t add up unless I am adding wrong.
This is from a job I looked at:

"Full health care with a Pay Scale is $19.00-$24.00 hour DOE. The per diem for this assignment is $116/day for the first 60 days and $81.20/day there after."

How does $19X8hrs = $152 per day but Per diem is $116? or does per deim mean $116 per half day?

How is this pay better then Per/hour?

 

[KENAT]

Or, it's them expecting you to get settled after a couple of months and find lower cost accomodation.

Just because they don't max out the IRS guideline for the full year doesn't necessarily mean they are ripping you off.

Remember it's just part of the whole compensation package.

KENAT, probably the least qualified checker you'll ever meet...

 

[Senselessticker]

It's all about what the contract allows for and what the IRS will allow. But what's most important is how "per diem" is defined/adversised. The "per diem" rate is ussually an amount not to exceed $xx.xx per day for a given amount of time.

Here is a good resource:

http://www.gsa.gov/Portal/gsa/ep/contentView.do?contentId=17943&contentType=GSA_BASIC

 

[SomptingGuy]

Yank tax!

So glad I gave it all up.

- Steve

 

[Helicopterjunky]

Gymmeh,

Some locations have different per diem allowable amount depending on the time of the year. An example is Phoenix where the rate goes up or down depending the season (mostly related to people escaping the winter some place else and thereby driving up the cost of living for part of the year). A good source to find the local per diem rate is go to the GSA website and search for 2008 per diem rates. Then input state and city and you will find out how much of your total salary can be gotten tax free. Remember lodging plus food. Take the per diem rate and multiply by seven and that is how much per week you can get tax free. Now the shop may try to get you for a lesser per diem as they are very scared of the IRS, and are trying not to get attention from same. But legally up to the stated perdiem is what can be given tax free. Many contractors are getting full per diem split. They all get 1.5 times rate for overtime. The shop will try to lie to you though. Lets say the shop offers a rate $40/hr. You find the per diem rate times seven for the job location comes out to 800/wk. Then shop would give you 20 hr which is subject to Federal Tax and 20/hr which is not. Keep in mind some shops will not let you claim full PD as they are worried about covering themselves with the IRS but if you stick to your guns most will let you split 100% PD allowable. Most shop will also re-imburse for cheapest one way travel to job site after you have been there 30 days. With the price of gas or diesel this is not an insignificant amount. If I get a call for a contract job in California and I have to drive out from Virginia, I want to get paid for this expense. If you don't know the game they will get you as cheap as they can. That is why they like what I call "Newbies" to contracting. All the experienced road shoppers know what the going contract rates and allowables are. Good Luck!

 

[Gymmeh]

Excellent! Helicopter, alot of good info, however I think I am going to hold off on the contractor gig.

Some of the contractor rates are amazing but it seems like there is alot more to it than I want to deal with at this point in my life.

 

[Helicopterjunky]

I don't blame you. Living out of a suitcase and at the Red Roof Inn gets old after awhile. Some people enjoy the road. I did at one time also. But now I want to be home every evening with my loving wife. What price tag can you put on being away from home? Contractors get what they get because they carry all the liability and life on the road can be very hard. It is double hard if you are married and have kids. Lots of marriage and family breakups in the road contractor realm.

 

[ewh]

Thanks for some good, informative posts, Helicopterjunky. I too have the t-shirt. It was fun and I had some great experiences, but there comes a time...

Believe it if you need it or leave it if you dare. - [small]Robert Hunter[/small]

 

[BJC]

Both of these sites have information on per-diem and contracting.

http://www.roadtechs.com/

http://www.ceweekly.com/

I would not take the cut after 60 days.
They may be asuming you'll be moving into a cheaper digs like an apartment etc. If that's the case and you have to take the job get it in writing that they will pay exit expenses like walking out on lease etc.
In some places per-diem goes down seasonally, like a ski resort in the summer.
And lastly you may be dealing with a cheap or crooked shop. The may be charging the client $116 a day, seven days a week plus a mark up. Find out.

 

[KENAT]

How about looking it this way, not as a cut after 60 days but as a 'bonus' for the first 60?

Is the glass half full or half empty...

Remember it's only part of the complete compensation package.

KENAT, probably the least qualified checker you'll ever meet...

 

[KENAT]

Related just came up here and I found this:

http://www.irs.gov/pub/irs-pdf/p1542.pdf

KENAT, probably the least qualified checker you'll ever meet...

 

[NL8]

Is the glass half full or half empty...

We're engineers, the glass is twice the size it needed to be.

Joe Hasik, CSWP
SW 08 x64, SP 3.0
Dell T3400
Intel Core2 Quad
Q6700 2.66 GHz
3.93 GB RAM
NVIDIA Quadro FX 4600

 

[SomptingGuy]

The glass has a safety factor of 2.0

- Steve

 

[lowedogg]

here is the GSA website that determines per diem for all federal contracts:

http://www.gsa.gov/Portal/gsa/ep/contentView.do?contentId=17943&contentType=GSA_BASIC

 

[lowedogg]

i'm sorry, i see now that this link had already been provided...

 

[cvg]

...there is adequate freeboard in the glass, although it doesn't meet FEMA requirements...