Disclaimer: This article is for educational purposes only and is not tax, legal, or financial advice. Tax rules change periodically, always check current IRS/state guidance or consult a professional.
Calculate Your Take-Home Pay
Paycheck Calculator (US)
Free • No account • Works offline
Quick Answer: What Is Take-Home Pay?
Take-home pay is the amount of money you actually receive in your bank account after all taxes and deductions are withheld from your paycheck. It's also called net pay or net income.
Formula: Gross Pay − Taxes − Deductions = Take-Home Pay
Key Takeaways
- Take-home pay = net pay. Both terms describe the money deposited into your account after withholdings.
- Gross pay is your starting point. Your salary or hourly wages before any deductions are applied.
- Taxes reduce your paycheck. Federal income tax, state/local taxes, and FICA (Social Security + Medicare) are withheld each pay period.
- Pre-tax deductions lower your taxable income. Contributions to 401(k), HSA, and health insurance reduce what you owe in taxes.
- Your W-4 affects federal withholding. Updating your W-4 can increase or decrease your take-home pay.
What Is Take-Home Pay?
Take-home pay is the portion of your earnings that lands in your pocket (or bank account) after your employer withholds taxes and other deductions. When you look at your pay stub, the "net pay" line shows your take-home amount.
Common synonyms
- Net pay — the standard payroll term
- Net income — sometimes used interchangeably (though in accounting, this term can have broader meanings)
- After-tax pay — emphasizes that taxes have been removed
- Disposable income — in economics, often means income after taxes
Why take-home pay matters
Your take-home pay is what you actually have to spend on rent, groceries, savings, and everything else. Knowing this number helps you:
- Create a realistic monthly budget
- Evaluate job offers (a higher salary doesn't always mean more take-home pay)
- Plan for retirement contributions and benefit elections
- Avoid surprises at tax time
Take-Home Pay vs. Gross Pay
Understanding the difference between gross pay and take-home pay is essential for financial planning.
Gross pay
Gross pay is your total earnings before any deductions. For salaried employees, it's your annual salary divided by the number of pay periods. For hourly workers, it's your hourly rate multiplied by hours worked.
- Salary example: $52,000/year ÷ 26 biweekly periods = $2,000 gross per paycheck
- Hourly example: $20/hour × 40 hours = $800 gross for the week
Take-home pay (net pay)
Take-home pay is what remains after your employer withholds taxes and deductions from your gross pay.
The gap between gross and net
For most workers, take-home pay is roughly 70–80% of gross pay, but this varies based on:
- Your tax bracket and filing status
- State and local tax rates
- Pre-tax benefit contributions
- Number of allowances/adjustments on your W-4
Visual flow: Gross Pay → Pre-tax Deductions → Taxable Wages → Tax Withholdings → Post-tax Deductions → Take-Home Pay
What Reduces Your Take-Home Pay?
Several categories of withholdings reduce your gross pay to arrive at take-home pay.
1. Federal income tax
Based on your taxable income and W-4 elections, your employer withholds federal income tax each pay period. The 2026 tax brackets determine how much you owe.
2. State and local taxes
Most states impose income tax. Some cities and counties also levy local taxes. A few states (like Texas, Florida, and Washington) have no state income tax, which can significantly boost take-home pay.
3. FICA taxes (Social Security and Medicare)
- Social Security: 6.2% of wages up to the annual wage base ($184,500 in 2026)
- Medicare: 1.45% of all wages, plus an additional 0.9% on wages over $200,000
Your employer matches these amounts, but only your portion appears on your pay stub.
4. Pre-tax deductions
These reduce your taxable income before taxes are calculated:
- 401(k) or 403(b) contributions
- Health savings account (HSA) contributions
- Health, dental, and vision insurance premiums
- Flexible spending accounts (FSA)
- Commuter benefits
While pre-tax deductions reduce your take-home pay, they also lower your tax burden.
5. Post-tax deductions
These come out after taxes are calculated:
- Roth 401(k) contributions
- Wage garnishments
- Union dues
- Charitable payroll deductions
- After-tax insurance premiums
How to Calculate Take-Home Pay
Follow these five steps to estimate your take-home pay.
- Start with gross pay. Calculate your total earnings for the pay period. For salary: divide annual salary by the number of pay periods. For hourly: multiply hours worked by your hourly rate.
- Subtract pre-tax deductions. Remove 401(k) contributions, HSA/FSA contributions, and health insurance premiums to determine your taxable wages.
- Calculate tax withholdings. Apply federal income tax (based on W-4 and IRS tables), state/local taxes, and FICA (6.2% Social Security + 1.45% Medicare).
- Subtract post-tax deductions. Deduct Roth 401(k) contributions, garnishments, and any other after-tax items.
- Result: take-home pay. The remaining amount is your net pay, the money deposited into your bank account.
Tip: Use our Paycheck Calculator to run these calculations automatically for your specific situation.
2026 Take-Home Pay Examples
These examples show approximate take-home pay using 2026 tax rates. Your actual results depend on your specific W-4 settings, state, and deductions.
- Gross pay: $50,000/year ($1,923.08 biweekly)
- Filing status: Single, no dependents
- Pre-tax deductions: None
- Federal income tax: ~$218/paycheck
- FICA: ~$147/paycheck (Social Security $119 + Medicare $28)
- State tax: $0 (Texas)
- Take-home pay: ~$1,558 biweekly (~$40,500/year)
Take-home percentage: ~81% of gross
- Gross pay: $75,000/year ($2,884.62 biweekly)
- Filing status: Married filing jointly, 2 dependents
- Pre-tax deductions: 6% to 401(k) ($173/paycheck)
- Federal income tax: ~$198/paycheck
- FICA: ~$221/paycheck
- California state tax: ~$98/paycheck
- Take-home pay: ~$2,195 biweekly (~$57,100/year)
Take-home percentage: ~76% of gross
- Hourly rate: $25/hour
- Hours worked: 45 hours (40 regular + 5 overtime at 1.5×)
- Gross pay: $1,000 + $187.50 = $1,187.50 weekly
- Filing status: Single, Florida (no state tax)
- Federal income tax: ~$125/week
- FICA: ~$91/week
- Take-home pay: ~$971 for the week
Take-home percentage: ~82% of gross
Frequently Asked Questions
Troubleshooting and Tips
- Review your pay stub regularly. Check that deductions match your elections and that your W-4 information is current.
- Use a paycheck calculator. Before making changes to your W-4 or benefits, model the impact on your take-home pay.
- Consider state taxes when relocating. Moving from a high-tax state to a no-income-tax state can boost your take-home pay by several percentage points.
- Balance pre-tax savings with cash flow. Maxing out your 401(k) reduces take-home pay but builds retirement savings. Find the right balance for your situation.
- Check for over-withholding. If you consistently receive large tax refunds, you're essentially giving the government an interest-free loan. Adjust your W-4 to keep more money in each paycheck.
- Watch for mid-year changes. Raises, job changes, or benefit updates mid-year can affect your take-home pay and year-end tax situation.
References
- IRS Publication 15-T (Federal Income Tax Withholding Methods) — Official IRS guidance on how employers calculate federal tax withholding.
- IRS Form W-4 and Instructions — Employee withholding certificate that determines your federal tax withholding.
- SSA Contribution and Benefit Base — Annual Social Security wage base limit for OASDI ($184,500 in 2026).
- IRS Topic 751: Social Security and Medicare Withholding Rates — Current FICA tax rates and thresholds.