How to Calculate Your Net Take-Home Pay

Your gross salary is the amount you earn before any deductions are made. Your net paycheck (take-home pay) is the amount you actually receive in your bank account after federal taxes, state taxes, FICA, and pre-tax deductions are subtracted. Follow these steps to estimate your paycheck:

1. Enter your annual salary — Input your total yearly earnings (e.g., $65,000).
2. Select your pay frequency — Choose how often you get paid (weekly, bi-weekly, semi-monthly, or monthly).
3. Select your state — Choose your US state to estimate state income tax. Texas, Florida, Washington, and Nevada have no state income tax.
4. Enter pre-tax deductions — Input the percentage of your salary contributed to 401(k) retirement accounts, health insurance premiums, or pre-tax flexible spending accounts (e.g., 5%).
5. Click “Estimate Take-Home Pay” — The tool will calculate your net check amount and show an annualized tax breakdown.

Understanding Paycheck Tax Deductions

Here are the primary deductions removed from a standard US paycheck:

• Pre-Tax Deductions: Contributions made to retirement plans (like a 401k or 403b), health savings accounts (HSA), or employer-provided health insurance. These contributions lower your taxable income, reducing the amount of federal and state income tax you pay.
• Federal Income Tax: A progressive tax collected by the IRS to fund national defense, infrastructure, and federal programs. Your tax rate depends on your income bracket and filing status.
• FICA (Federal Insurance Contributions Act): A mandatory federal payroll tax that funds Social Security (6.2% of wages) and Medicare (1.45% of wages). Both the employee and the employer pay this tax.
• State Income Tax: Taxes levied by individual states. Nine US states (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming) do not collect state income tax on wage earnings.

FICA Tax Rates and Limits

For the tax year 2026, the FICA tax rates are set at:

• Social Security Tax: 6.2% on earnings up to the wage limit (typically adjusted annually for inflation).
• Medicare Tax: 1.45% on all earnings. An additional 0.9% Medicare tax is applied to earnings exceeding $200,000 (single filers) or $250,000 (joint filers).

Frequently Asked Questions

What is the difference between bi-weekly and semi-monthly pay?

Bi-weekly employees are paid every two weeks, resulting in 26 paychecks per year. In some months, bi-weekly employees receive three checks. Semi-monthly employees are paid twice a month (usually on the 1st and 15th), resulting in exactly 24 paychecks per year. Although your gross pay per check is higher on a semi-monthly schedule, your total annual gross remains identical.

How do pre-tax deductions save you money on taxes?

Because pre-tax deductions are subtracted from your gross earnings before taxes are calculated. If you earn $65,000 and contribute 10% ($6,500) to a 401k, you are only taxed on $58,500. This lowers your federal and state tax liability.

Which states do not have state income tax?

The states with no wage income tax are: Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. New Hampshire has no income tax on wages but does tax interest and dividends.

What does “gross pay” mean?

Gross pay is the total amount of money you earn before any taxes, retirement contributions, health insurance, or other deductions are taken out of your paycheck.