Calculate your net take-home pay after all federal, state, and FICA deductions. Understand every line item on your pay stub — from gross wages to taxable income to your actual take-home amount.
Standard deductions that reduce your gross pay to net take-home
Enter your gross salary, filing status, state, and deductions to see your exact net pay per paycheck, month, and year.
Open Paycheck Calculator →A pay stub can look confusing the first time you see it — a gross pay number at the top and a much smaller net pay at the bottom, with rows of deductions in between. Understanding each deduction empowers you to verify your paycheck is correct and make smart decisions about voluntary deductions like 401k contributions and health insurance elections.
The federal income tax is calculated using the IRS tax brackets for 2025: 10% on the first $11,925 of taxable income ($23,850 for married filing jointly), 12% on income $11,925–$48,475, 22% on $48,475–$103,350, 24% on $103,350–$197,300, 32% on $197,300–$250,525, 35% on $250,525–$626,350, and 37% on income above $626,350. These are marginal rates — you pay 10% on the first tier, then 12% on the next tier, and so on. Your effective (average) tax rate is always lower than your marginal (top) rate.
Your W-4 determines how much federal tax your employer withholds. Filing as single results in more withholding than married. Adding dependents or extra deductions in Step 4 reduces withholding. Your employer uses IRS withholding tables to calculate the exact amount to withhold each paycheck based on your W-4 elections and pay frequency.
FICA (Federal Insurance Contributions Act) taxes fund Social Security and Medicare. Social Security: 6.2% of your gross wages, but only on wages up to the Social Security wage base ($176,100 in 2025). Once you earn $176,100, no more Social Security tax is withheld for that year. Medicare: 1.45% of all wages with no cap. High earners (above $200,000 single / $250,000 married) also pay an additional 0.9% Medicare surtax. Your employer matches your FICA contributions — they pay an additional 6.2% Social Security and 1.45% Medicare on top of your share.
State income taxes vary dramatically. Nine states have no state income tax: Alaska, Florida, Nevada, New Hampshire (on wages), South Dakota, Tennessee (on wages), Texas, Washington (on wages), and Wyoming. California has the highest top rate at 13.3%. Most states with income taxes have rates between 3–6%. Some cities (New York City, Philadelphia, Detroit) also levy local income taxes on top of state taxes.
Traditional 401k contributions are made pre-tax, reducing your taxable income dollar-for-dollar. If you contribute $500/month to your 401k and you're in the 22% federal bracket, your federal taxes decrease by $110/month — meaning the real cost of your $500 contribution is only $390 (plus whatever state taxes apply). In 2025, you can contribute up to $23,500 to a 401k ($31,000 if you're 50+). A Roth 401k uses after-tax money, so no current tax deduction, but growth and retirement withdrawals are tax-free.
Employer-sponsored health insurance premiums are typically deducted pre-tax through a Section 125 cafeteria plan, reducing both your income tax and FICA taxes. If your monthly premium is $300 and you're in the 22% tax bracket, your actual cost is approximately $207 after the tax savings. The employer usually covers a significant portion of the premium — on average, employers pay about 70% of single coverage and 60% of family coverage.
Health Savings Accounts (HSAs) are available to people with high-deductible health plans. HSA contributions are triple-tax-advantaged: tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. 2025 limits: $4,300 individual, $8,550 family. Flexible Spending Accounts (FSAs) are similar but use-it-or-lose-it (most plans have a $640 rollover provision). Both HSA and FSA contributions are made pre-tax via payroll, reducing income and FICA taxes.
These three income figures all appear in different contexts. Gross income: total compensation before any deductions. This is what your employer pays you and what your offer letter says. Taxable income: gross income minus pre-tax deductions (401k, health insurance, HSA, FSA, commuter benefits). This is the number your federal and state income taxes are calculated on — it's lower than your gross. Net income (take-home pay): taxable income minus all taxes and post-tax deductions. This is what hits your bank account.
Example for a $60,000/year earner in Texas (no state income tax), filing single, contributing $3,000/year to 401k and paying $2,400/year in health premiums: Gross = $60,000. Taxable income = $60,000 − $3,000 − $2,400 = $54,600. Federal tax on $54,600 (after $15,000 standard deduction) ≈ $5,900. Social Security = $3,720 (6.2% × $60,000). Medicare = $870. Net = $60,000 − $3,000 − $2,400 − $5,900 − $3,720 − $870 = $44,110/year ($3,676/month).
The W-4 is one of the most important forms you fill out as an employee, yet most people complete it on day one and never revisit it. Your W-4 tells your employer how much federal income tax to withhold from each paycheck. Getting it right means avoiding two unpleasant surprises: a large tax bill in April, or giving the IRS an interest-free loan all year (a large refund).
The goal is to have your withholding match your actual tax liability as closely as possible. Key situations where you should update your W-4: getting married or divorced, having a child, taking a second job, starting a significant side business, making large charitable donations, or significant changes in income. The IRS Tax Withholding Estimator at irs.gov/W4app can calculate your ideal withholding with precision.
Most Americans pay 20–30% in combined federal and state taxes. Social Security = 6.2%, Medicare = 1.45%, federal income tax varies by bracket (effective rate typically 10–22% for most earners), state tax = 0–13.3%. A $50,000/year earner takes home approximately $38,000–$42,500 depending on state and deductions.
Gross = total before deductions. Taxable income = gross minus pre-tax deductions (401k, health insurance, HSA). Net (take-home) = what you receive after all taxes and deductions. On a $60K salary with $5,400 in pre-tax deductions and $10,500 in taxes: net = approximately $44,100/year.
Use Step 4 on the W-4: enter extra deductions in 4b to reduce withholding (if you typically get large refunds), or additional withholding per paycheck in 4c (if you owe taxes at year-end). Update after major life events: marriage, divorce, new child, second job. Use the IRS Tax Withholding Estimator for precision.
Common reasons: partial pay period (started mid-cycle), benefits deductions starting immediately (health insurance, dental, 401k), W-4 defaulting to high withholding, and state/local taxes overlooked during salary negotiations. Review your pay stub line by line to identify unexpected deductions and contact HR if something appears incorrect.