Take-Home Pay Calculator

Take-home pay is your gross pay minus federal withholding, state and local withholding, FICA, and any pre-tax or after-tax deductions. For many W-2 workers, about 25% to 35% of gross pay goes to taxes before deduction choices are applied, but the exact result depends on your W-4, pay frequency, state, earnings mix, and benefits.

Employers typically calculate federal withholding using IRS Publication 15-T, then apply Social Security, Medicare, state rules, and deduction routing. That is why two people with the same salary can still bring home different net pay.

How Is Take-Home Pay Calculated?

Payroll usually follows this order: start with gross pay, subtract eligible pre-tax deductions, calculate federal withholding, calculate FICA, calculate state and local withholding, subtract after-tax deductions, and the remainder is net pay.

What Is Take-Home Pay?

Take-home pay (also called net pay) is the amount you receive after your employer withholds federal income tax, state income tax, FICA taxes (Social Security and Medicare), and any deductions you've elected — like 401(k) contributions, health insurance, or HSA deposits.

If you earn $60,000 a year, your take-home pay is not $60,000. Depending on your state, filing status, and deductions, your actual take-home could be anywhere from $42,000 to $50,000. The difference matters.

What Gets Taken Out of Your Paycheck?

Federal Income Tax

The IRS uses a progressive bracket system. Your employer calculates withholding each pay period using IRS Publication 15-T — they annualize your pay, apply your W-4 adjustments (filing status, dependents, extra withholding), look up the tax in the bracket table, and divide back to a per-period amount. The more you earn, the higher your marginal rate — but only on income above each bracket threshold.

FICA Taxes (Social Security and Medicare)

Every W-2 worker pays FICA taxes. Social Security tax is 6.2% of your wages up to the annual wage base ($176,100 in 2025, $184,500 in 2026). Once you hit the cap, Social Security tax stops for the rest of the year. Medicare tax is 1.45% on all wages, with an additional 0.9% on wages above $200,000 (Additional Medicare Tax).

State Income Tax

Most states withhold state income tax from your paycheck. Nine states have no income tax (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming). The rest use either flat rates or progressive brackets. Some cities and counties also levy local income taxes — places like New York City, Philadelphia, and many Ohio cities.

Pre-Tax Deductions

Pre-tax deductions reduce your taxable income before taxes are calculated — learn more about how deductions affect your paycheck. Common examples include traditional 401(k) contributions, HSA contributions, and Section 125 cafeteria plan items (health, dental, vision insurance). A $200 per-paycheck 401(k) contribution doesn't just reduce your take-home by $200 — it also lowers your tax bill because it reduces the income that gets taxed.

After-Tax Deductions

After-tax deductions are taken from your pay after taxes are calculated. Roth 401(k) contributions are the most common example — you pay taxes now but get tax-free withdrawals in retirement. Both traditional and Roth 401(k) contributions are calculated as a percentage of your gross pay (they're both elective deferrals from compensation per IRS rules).

How to Calculate Your Take-Home Pay

Here's the basic flow your employer's payroll system follows:

1. Start with gross pay — your salary divided by pay periods, or hours worked times your hourly rate (including overtime at 1.5x or 2x)
2. Subtract pre-tax deductions — 401(k), HSA, health insurance premiums
3. Calculate federal tax — using the IRS Pub 15-T worksheet with your W-4 settings
4. Calculate FICA — Social Security (6.2%) + Medicare (1.45%) on the FICA-taxable amount
5. Calculate state and local tax — using your state's withholding rules
6. Subtract after-tax deductions — Roth 401(k), garnishments
7. The result is your take-home pay

The tricky part is that different deductions have different tax treatments. A traditional 401(k) reduces your federal, state, and FICA taxable income. An HSA does the same. But a Roth 401(k) doesn't reduce any of those — it comes out after taxes are calculated. Getting this routing wrong changes your take-home by hundreds of dollars per year. If you're unsure how your W-4 settings affect this calculation, see our guide to filling out your W-4.

Why Your Take-Home Pay Varies

If you're an hourly worker, shift-based employee, or anyone who works overtime, your take-home pay changes every pay period. More hours means more gross pay, which means more taxes withheld — but not proportionally, because of how progressive tax brackets work. A paycheck with 10 overtime hours will have a different effective tax rate than one with zero.

Even salaried workers see variation when they get a bonus, change their W-4, adjust their 401(k) contribution, or hit the Social Security wage cap partway through the year.

How TakeHome IQ Helps

TakeHome IQ is a paycheck intelligence app that calculates your take-home pay using IRS Publication 15-T for federal withholding and state-specific rules for all 50 states, DC, and Puerto Rico. It handles the complexity that spreadsheets and simple calculators miss:

• Full W-4 support (Steps 2, 3, 4a, 4b, 4c)
• Correct deduction tax treatment — pre-tax vs. after-tax routing for 401(k), HSA, Roth, and more
• FICA with year-to-date tracking for Social Security wage cap and Additional Medicare
• Overtime calculation with multi-tier support (1.5x, 2x, custom)
• Live pay period dashboard — adjust overtime, extra pay, or missed time and see your net pay update
• A transparent audit trail showing every step of the calculation

Frequently Asked Questions

What is take-home pay?

Take-home pay is the amount that hits your bank account after all taxes (federal, state, FICA) and deductions (401k, insurance, etc.) are subtracted from your gross pay.

How much of my paycheck goes to taxes?

For most W-2 workers, roughly 25-35% of gross pay goes to taxes: federal income tax (varies by bracket), Social Security (6.2% up to $184,500), Medicare (1.45%), and state income tax (varies by state, 0% in 9 states).

What's the difference between gross pay and net pay?

Gross pay is your total earnings before anything is deducted. Net pay (take-home pay) is what's left after federal tax, state tax, FICA, and all deductions are subtracted.