Paycheck Calculator
Estimate Your Take-Home Pay
Understanding Your Paycheck
Your paycheck is smaller than your salary because of mandatory deductions. Federal income tax, state income tax, Social Security, and Medicare are all withheld before you see a dollar. Optional deductions like 401(k) contributions, health insurance premiums, and HSA contributions further reduce your take-home pay — but provide significant financial benefits.
Paycheck Deductions Breakdown
- Federal Income Tax — Progressive rates from 10% to 37% based on your taxable income after deductions
- State Income Tax — 0% to 13.3% depending on your state. Nine states have no income tax: AK, FL, NV, NH, SD, TN, TX, WA, WY
- Social Security (FICA) — 6.2% on income up to $168,600 (2024)
- Medicare — 1.45% on all income, plus 0.9% on income over $200,000
- 401(k) / Retirement — Pre-tax contributions reduce your taxable income (max $23,500 in 2025)
Tips for Maximizing Take-Home Pay
- Review your W-4 — Adjust withholding to avoid large refunds (an interest-free loan to the government) or owing a big tax bill
- Max your employer 401(k) match — If your employer matches 50% up to 6%, contribute at least 6%. Anything less is leaving free money on the table
- Use an HSA if eligible — Triple tax advantage: tax-deductible contributions, tax-free growth, tax-free withdrawals for medical expenses
- Consider a Roth 401(k) — Pay tax now at your current rate and withdraw tax-free in retirement. Valuable if you expect to be in a higher bracket later
Frequently Asked Questions
How is federal income tax calculated?
The US uses progressive tax brackets. You don't pay a flat rate on all income — each portion of income is taxed at increasing rates. For 2024, the brackets are: 10% (up to $11,600), 12% ($11,601-$47,150), 22% ($47,151-$100,525), 24% ($100,526-$191,950), 32% ($191,951-$243,725), 35% ($243,726-$609,350), and 37% (above $609,350).
What is the difference between gross and net pay?
Gross pay is your total salary before deductions. Net pay (take-home pay) is what you actually receive after federal tax, state tax, Social Security (6.2%), Medicare (1.45%), and any benefits deductions (health insurance, 401k contributions). Net pay is typically 65-80% of gross for most workers.
How much does a 401(k) contribution reduce my taxes?
Traditional 401(k) contributions are pre-tax, reducing your taxable income dollar for dollar. If you're in the 22% bracket and contribute $500/month, you save $110/month in federal taxes. The money grows tax-deferred until withdrawal in retirement.
What are FICA taxes?
FICA taxes fund Social Security (6.2% of income up to $168,600 in 2024) and Medicare (1.45% of all income, plus an additional 0.9% on income over $200,000). Combined, FICA takes 7.65% of your gross pay. Your employer pays a matching 7.65% on top of that.