California Therapy Practice Simulator

This is not a revenue split — it is payroll. In California a registered associate must be a W-2 employee (or a volunteer) and may not bill clients directly. Your practice bills the client, so all of it is your revenue, and the “split” is simply how you work out their wage.

What a wage costs on top of the wage

What the wage does not pay for

Progress notes, case management, client advocacy, treatment planning, no-shows and team meetings. For a non-exempt employee that time is still hours worked and still has to be paid — a share-of-collections wage that ignores it can fall below minimum wage once the real hours are counted, which is the practice’s problem, not the associate’s.

Sources

• Cal. Bus. & Prof. Code §4980.43.3 and 16 CCR §1833 — associates must be W-2 employees or volunteers and may not bill clients directly.
• EDD, Federal Unemployment Tax Act — California is in credit reduction, so the effective FUTA rate here is 1.8%, not 0.6%, which EDD puts at an extra $84 per employee a year.
• EDD, California payroll taxes — UI at the new-employer rate and ETT are employer-paid on the first $7,000 of each employee’s wages; SDI is withheld from the employee.
• Workers’ compensation is mandatory for any California employee — the rate depends on your carrier and class code, which is why it is an input rather than an assumption.