Your take-home pay is your gross income minus federal taxes, state taxes, Social Security, Medicare, and any deductions. For a $60,000 salary in a state with no income tax, you can expect roughly $47,000 in annual take-home pay, or about $1,808 per biweekly paycheck.

When I landed my first $55,000 salaried position, I was shocked to see only $1,642 on my biweekly pay stub instead of the $2,115 I expected. It took me three pay cycles to fully understand where the missing $473 went -- $264 to federal taxes, $131 to FICA, and $78 to state income tax. That experience taught me the importance of understanding every line on a paycheck before making financial commitments.

Use our Paycheck Calculator to get an accurate estimate of your net pay based on your specific situation.

Understanding Your Paycheck

Every paycheck has multiple deductions that reduce your gross pay to net pay (take-home). Here's what comes out of your check:

Mandatory Deductions

Deduction	Rate	What It Funds
Federal Income Tax	10-37% (marginal)	Federal government operations
Social Security (FICA)	6.2%	Retirement, disability benefits
Medicare (FICA)	1.45%	Healthcare for seniors
Additional Medicare	0.9% (over $200k)	High earner supplement
State Income Tax	0-13.3%	State government operations
Local Income Tax	Varies	City/county services

Optional Deductions

Deduction	Typical Range	Notes
401(k) Contribution	0-$23,000/year	Pre-tax, reduces taxable income
Health Insurance	$100-$600/month	Often pre-tax
HSA Contribution	Up to $4,150/year	Pre-tax, for medical expenses
FSA Contribution	Up to $3,200/year	Pre-tax, use it or lose it
Life Insurance	$10-$50/month	Employer-sponsored
Disability Insurance	0.5-2% of salary	Short/long term

Tip

Pre-tax deductions reduce your taxable income. A $500/month 401(k) contribution doesn't reduce your take-home by $500 — it reduces it by less because you save on taxes.

How to Calculate Your Take-Home Pay

Step 1: Start with Gross Pay

Your gross pay is your salary divided by pay periods:

Annual Salary	Weekly	Biweekly	Semi-Monthly	Monthly
$40,000	$769.23	$1,538.46	$1,666.67	$3,333.33
$50,000	$961.54	$1,923.08	$2,083.33	$4,166.67
$60,000	$1,153.85	$2,307.69	$2,500.00	$5,000.00
$75,000	$1,442.31	$2,884.62	$3,125.00	$6,250.00
$100,000	$1,923.08	$3,846.15	$4,166.67	$8,333.33

Pay periods per year:

Weekly: 52
Biweekly: 26
Semi-monthly: 24
Monthly: 12

Step 2: Calculate Federal Income Tax Withholding

Federal taxes are based on taxable income after deductions and your W-4 selections.

2026 Federal Tax Brackets (Single Filer):

Taxable Income	Tax Rate
$0 - $11,925	10%
$11,926 - $48,475	12%
$48,476 - $103,350	22%
$103,351 - $197,300	24%
$197,301 - $250,525	32%
$250,526 - $626,350	35%
$626,351+	37%

2026 Federal Tax Brackets (Married Filing Jointly):

Taxable Income	Tax Rate
$0 - $23,850	10%
$23,851 - $96,950	12%
$96,951 - $206,700	22%
$206,701 - $394,600	24%
$394,601 - $501,050	32%
$501,051 - $751,600	35%
$751,601+	37%

Important

Tax brackets are marginal. If you earn $60,000 as a single filer, you don't pay 22% on everything. You pay 10% on the first $11,925, 12% on the next $36,550, and 22% only on income above $48,475.

Step 3: Calculate FICA Taxes

Social Security:

Rate: 6.2% of gross pay
Wage base limit: $168,600 (2026)
Maximum tax: $10,453.20/year

Medicare:

Rate: 1.45% of all wages
Additional Medicare: 0.9% on wages over $200,000

Example ($60,000 salary):

Social Security: $60,000 × 6.2% = $3,720
Medicare: $60,000 × 1.45% = $870
Total FICA: $4,590/year or $176.54/biweekly

Step 4: Calculate State Income Tax

State taxes vary dramatically. Here's a comparison:

No State Income Tax:

Alaska, Florida, Nevada, New Hampshire*, South Dakota, Tennessee*, Texas, Washington, Wyoming

(*NH and TN only tax investment income)

Flat Tax States (Examples):

State	Flat Rate
Colorado	4.40%
Illinois	4.95%
Indiana	3.05%
Michigan	4.25%
Utah	4.65%

Progressive Tax States (Examples):

State	Rate Range	Top Rate Threshold
California	1% - 13.3%	$1,000,000+
New York	4% - 10.9%	$25,000,000+
New Jersey	1.4% - 10.75%	$5,000,000+
Oregon	4.75% - 9.9%	$125,000+

Step 5: Subtract Pre-Tax Deductions

Pre-tax deductions reduce your taxable income:

Example calculation:

Gross biweekly pay: $2,307.69
- 401(k) contribution: $200.00
= Taxable wages: $2,107.69

Then calculate taxes on the reduced amount.

Paycheck Breakdown Example

Let's walk through a complete example:

Profile:

Salary: $65,000/year
Location: Texas (no state income tax)
Filing status: Single
Pay frequency: Biweekly (26 paychecks)
401(k): 6% contribution
Health insurance: $150/paycheck (pre-tax)

Gross Pay:

$65,000 ÷ 26 = $2,500.00 per paycheck

Pre-Tax Deductions:

401(k) (6%): $150.00
Health insurance: $150.00
Total pre-tax: $300.00
Taxable wages: $2,200.00

Federal Tax (estimated for taxable income):

Approx. $264.00 per paycheck

FICA Taxes:

Social Security (6.2%): $155.00
Medicare (1.45%): $36.25
Total FICA: $191.25

Net Pay Calculation:

Gross pay: $2,500.00
- 401(k): $150.00
- Health insurance: $150.00
- Federal tax: $264.00
- FICA: $191.25
= Net pay: $1,744.75

Annual Summary:

Gross salary: $65,000.00
Take-home: $45,363.50 (69.8% of gross)

Factors That Affect Your Take-Home Pay

W-4 Selections

Your W-4 form tells your employer how much federal tax to withhold:

Filing Status	Standard Deduction (2026)
Single	$15,000
Married Filing Jointly	$30,000
Head of Household	$22,500

Adjustments that increase take-home pay:

Additional dependents claimed
Other income claims (if filing jointly)
Deductions claimed

Adjustments that decrease take-home pay:

Extra withholding requested
Multiple jobs worksheet

Warning

Owing taxes at year-end hurts. If you reduce withholding too much, you may owe taxes plus potential penalties in April. Use the IRS Tax Withholding Estimator to dial in your W-4.

Pre-Tax vs. Post-Tax Contributions

Contribution Type	Impact on Taxable Income	Impact on Take-Home
Traditional 401(k)	Reduces	Smaller reduction
Health Insurance	Reduces	Smaller reduction
HSA	Reduces	Smaller reduction
Roth 401(k)	No reduction	Full reduction
After-tax benefits	No reduction	Full reduction

Local Taxes

Some cities and counties add their own income taxes:

Location	Local Tax Rate
New York City	3.078% - 3.876%
Philadelphia	3.79%
Detroit	2.4%
Cleveland	2.5%
Kansas City, MO	1.0%

Hourly vs. Salary Paycheck Differences

Salary Employees

Same gross pay each period
Predictable budgeting
Overtime rarely applies (for exempt employees)

Hourly Employees

Gross pay varies with hours worked
Overtime pay (1.5x) after 40 hours/week
May see fluctuations in take-home

Hourly to Salary Conversion:

Annual Salary = Hourly Rate × Hours Per Week × 52
$20/hour × 40 hours × 52 = $41,600/year

For hourly calculations, see our Hourly to Salary Calculator.

How to Increase Your Take-Home Pay

Legal Ways to Reduce Taxes

Maximize pre-tax contributions
- 401(k): Up to $23,000/year
- HSA: Up to $4,150 (individual) or $8,300 (family)
Review your W-4
- Ensure accurate filing status
- Claim all eligible dependents
- Adjust if you consistently get large refunds
Consider Roth strategically
- Roth reduces take-home now but grows tax-free
- Best for those expecting higher taxes in retirement

Negotiate Better Benefits

Higher employer 401(k) match
Better health insurance (lower premiums)
HSA-eligible health plan
Commuter benefits (pre-tax transit)

Tip

Getting a big tax refund? Adjust your W-4. A $2,400 refund means you overpaid by $200/month. That's YOUR money that could be in your paycheck instead of an interest-free loan to the government.

How to Use Our Paycheck Calculator

Our Paycheck Calculator handles all the complexity:

Enter gross salary or hourly rate — annual salary or hourly wage
Select pay frequency — weekly, biweekly, semi-monthly, monthly
Choose your state — automatic state tax calculation
Add filing status — single, married, head of household
Input deductions — 401(k), health insurance, other pre-tax items
Get results — detailed breakdown of every deduction

The calculator provides both per-paycheck and annual summaries.

Common Paycheck Mistakes

Mistake 1: Ignoring Pre-Tax Benefits

Problem: Not contributing to pre-tax accounts means paying more taxes than necessary.

Solution: At minimum, contribute enough to get your full employer 401(k) match. It's free money AND tax savings.

Mistake 2: Wrong W-4 Settings

Problem: Claiming too few allowances overwitholds; too many underwitholds.

Solution: Use the IRS withholding calculator after any life change (marriage, child, new job).

Mistake 3: Not Reviewing Pay Stubs

Problem: Errors in deductions, tax rates, or contributions go unnoticed.

Solution: Review every pay stub for accuracy. Compare to previous stubs when things change.

Frequently Asked Questions

How do I calculate my take-home pay?

Start with gross pay, subtract pre-tax deductions (401k, health insurance), calculate federal and state income taxes on the reduced amount, subtract FICA taxes (7.65%), then subtract any post-tax deductions. Our Paycheck Calculator automates this process.

Why is my take-home pay so low?

Common reasons include: high federal/state tax brackets, significant FICA contributions (7.65%), pre-tax deductions for retirement and insurance, and local income taxes. Review your pay stub to see exactly where money goes.

How much will I take home on a $50,000 salary?

In a no-state-tax state, a single filer with standard deductions will take home approximately $40,500-$42,000 annually. In high-tax states like California or New York, expect $36,000-$39,000 after state taxes.

Should I adjust my W-4 if I get a big refund?

Yes, if you consistently receive large refunds (over $500), you're overwithholding. Use the IRS Tax Withholding Estimator to adjust your W-4 and get more money in each paycheck.

How do 401(k) contributions affect my paycheck?

Pre-tax 401(k) contributions reduce your taxable income, so a $500 contribution doesn't reduce your take-home by $500. If you're in the 22% bracket, that $500 contribution only reduces your paycheck by about $390 ($500 × 78%).

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

Gross pay is your total earnings before deductions. Net pay (take-home pay) is what you actually receive after federal taxes, state taxes, FICA, and all other deductions are subtracted.

Budget Calculator — Plan your spending with the 50/30/20 rule (see our 50/30/20 budget guide for a deep dive)
Hourly to Salary Calculator — Convert hourly wages to annual salary
Savings Goal Calculator — Plan savings from your paycheck (our savings goal guide shows how to set targets)

Conclusion

Understanding your paycheck helps you plan better and potentially keep more of your money. Federal taxes, FICA, state taxes, and various deductions all take a bite, but strategic choices about pre-tax contributions and W-4 settings can optimize your take-home pay.

Use our Paycheck Calculator to see exactly how your gross pay becomes net pay. Armed with that knowledge, you can make informed decisions about retirement contributions, insurance elections, and tax withholding.

Tax calculations are estimates based on current tax rates and standard deductions. Individual situations vary based on filing status, deductions, credits, and local taxes. Consult a tax professional for personalized advice.