Commission Calculator
Calculate commission from a sale amount and rate, including tiered plans and base pay.
- Up to threshold
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- Above threshold
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- Commission
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- Base pay
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- Total pay this period
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- Sales needed for $1,000
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- Federal income tax
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- Social Security & Medicare
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- State income tax
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- Take-home
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Common questions
How do I calculate commission?
Multiply the sale amount by the commission rate. A 6% commission on a $48,000 sale is $48,000 × 0.06 = $2,880.
How does tiered commission work?
You earn one rate up to a threshold and a higher rate on sales above it. On a $48,000 sale with 6% up to $25,000 and 8% above, you earn $1,500 + $1,840 = $3,340.
How is commission taxed?
Commission is ordinary income. When it’s paid separately from regular wages, employers can withhold federal tax at a flat 22% as supplemental wages. Your actual tax is settled when you file.
What is a draw against commission?
An advance paid each period that’s later subtracted from the commission you earn. If commission falls short of the draw, some plans carry the balance forward.
How this is calculated
- Rates apply to the gross sale amount, not profit or margin.
- Tiered plans pay the higher rate only on the part of the sale above the threshold.
- Tax estimate uses the 22% federal supplemental withholding rate and your state’s supplemental rate; it’s withholding, not your final tax.
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