How to Calculate Your Paycheck After Taxes

Your paycheck shrinks in a fixed order: pre-tax benefits come out first, then Social Security and Medicare, then federal and state income tax withholding, then any after-tax deductions. Once you know each rule, you can reproduce your pay stub to the penny.

Short answer: net pay = gross pay − pre-tax deductions − Social Security (6.2%) − Medicare (1.45%) − federal income tax withholding − state and local withholding − after-tax deductions. For a single filer earning $75,000 in Illinois with a 6% 401(k) contribution and a $150 health premium, that works out to about $2,007 of a $2,885 biweekly check, as shown step by step below.

If you just want the number, the paycheck after-tax calculator does it for you. This guide shows the method so you can check your pay stub, test a W-4 change, or see what a new benefit election will do.

What is the formula for take-home pay?

The trick is that steps 3 and 4 use different wage bases. A traditional 401(k) contribution lowers income tax wages but not Social Security and Medicare wages, while health premiums and FSA contributions lower both.

Step 1: How do you figure gross pay per paycheck?

• Salaried: annual salary ÷ number of pay periods.
• Hourly: regular hours × rate, plus overtime hours × 1.5 × rate for nonexempt workers over 40 hours in a week.

Biweekly gives two "extra" checks a year compared with semimonthly, which is why each biweekly check is smaller even though the annual total is the same.

Step 2: Which deductions come out before tax?

Sources: IRS Notice 2025-67 news release for retirement limits, Rev. Proc. 2025-19 for HSAs, Rev. Proc. 2025-32 for the FSA and commuter limits, and Pub 15-B for the dependent care limit.

Example: $2,884.62 biweekly gross, 6% traditional 401(k), $150 health premium.

• 401(k): $75,000 × 6% = $4,500 a year ÷ 26 = $173.08
• Federal (and state) taxable wages: $2,884.62 − $173.08 − $150.00 = $2,561.54
• Social Security and Medicare wages: $2,884.62 − $150.00 = $2,734.62

For more on how the health FSA, dependent care FSA, and commuter elections work, see the FSA and commuter benefits tax savings guide.

Step 3: How do you calculate Social Security and Medicare?

For 2026, per IRS Publication 15:

• Social Security: 6.2% of Social Security wages until your year-to-date wages from that employer reach $184,500.
• Medicare: 1.45% of all Medicare wages.
• Additional Medicare: 0.9% withheld on wages above $200,000 from one employer, regardless of filing status.

Example:

• Social Security: $2,734.62 × 6.2% = $169.55
• Medicare: $2,734.62 × 1.45% = $39.65
• Total: $209.20

What happens when you pass the wage base?

On a $200,000 salary paid biweekly ($7,692.31 per check), Social Security is $476.92 per check. After 23 checks, year-to-date wages are $176,923.08, so the 24th check is taxed on only $184,500 − $176,923.08 = $7,576.92, or $469.77. Checks 25 and 26 have no Social Security at all, so they're $476.92 larger. If you change jobs, the new employer starts over at zero; any Social Security withheld above $11,439 ($184,500 × 6.2%) across all employers comes back as a credit on your Form 1040.

Step 4: How do you calculate federal income tax withholding?

Employers with automated payroll use Worksheet 1A and the annual percentage method tables in IRS Publication 15-T (2026). For a 2020-or-later Form W-4:

1. Multiply taxable wages for the period by the number of pay periods.
2. Add any Step 4(a) other income from your W-4.
3. Subtract any Step 4(b) deductions, plus $8,600 (or $12,900 if married filing jointly) unless you checked the Step 2 box.
4. Look up the result in the table for your filing status and compute the annual amount.
5. Divide by the number of pay periods.
6. Subtract your Step 3 credits divided by the number of pay periods (not below zero).
7. Add any Step 4(c) extra withholding.

2026 annual percentage method tables (Step 2 box not checked)

The dollar amounts in each cell are, in order, single, joint, and head of household. Notice how the tables are built: the $8,600 subtraction plus the $7,500 zero band equals the $16,100 single standard deduction, and $12,900 + $19,300 = $32,200 for joint filers. Every row is the 2026 tax bracket shifted by the standard deduction, which is why withholding on a single job with no other income lands very close to the real tax.

Example:

1. $2,561.54 × 26 = $66,600.04
2. $66,600.04 − $8,600 = $58,000.04
3. Row $57,900–$113,200: $5,800 + 22% × ($58,000.04 − $57,900) = $5,800 + $22.01 = $5,822.01
4. $5,822.01 ÷ 26 = $223.92 per paycheck

Cross-check against the actual tax: $75,000 − $4,500 − $3,900 = $66,600 of W-2 wages, minus the $16,100 standard deduction = $50,500 taxable income. Under the 2026 single brackets that's $5,800 + 22% × $100 = $5,822. Withholding and tax match.

Step 5: How do you estimate state income tax withholding?

Nine states don't tax wage income: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. The rest use either a flat rate or graduated tables, and a few cities and counties add a local wage tax.

Illinois is the simplest flat-rate case. Its 2026 formula in Booklet IL-700-T is 4.95% × (wages − (Line 1 allowances × $2,925 + Line 2 allowances × $1,000) ÷ pay periods).

Example (one Line 1 allowance):

• Allowance per check: $2,925 ÷ 26 = $112.50
• Taxable: $2,561.54 − $112.50 = $2,449.04
• Withholding: $2,449.04 × 4.95% = $121.23

Graduated-rate states work like the federal method: annualize, subtract the state's deduction or allowances, apply the state brackets, divide back down. Your state revenue department publishes the exact tables each year.

Step 6: Put it together

Single filer, $75,000 salary, Illinois, biweekly, W-4 with no adjustments:

The check is 69.6% of gross, but taxes alone are $554.35, or 19.2%. The other $323.08 goes to your own 401(k) and health coverage. After-tax items such as Roth 401(k) contributions, union dues, or wage garnishments would come off this net figure.

Worked example: hourly pay with overtime

Single, $28 an hour, 45 hours a week, paid weekly, in Texas.

• Gross: 40 × $28 = $1,120 + 5 × $42 = $210 → $1,330
• Social Security: $1,330 × 6.2% = $82.46
• Medicare: $1,330 × 1.45% = $19.29
• Federal: $1,330 × 52 = $69,160 − $8,600 = $60,560 → $5,800 + 22% × $2,660 = $6,385.20 ÷ 52 = $122.79
• Net pay: $1,330 − $82.46 − $19.29 − $122.79 = $1,105.46

The "half" in time-and-a-half here is 5 × $14 = $70 a week, or $3,640 a year. Under the One Big Beautiful Bill Act, that premium is deductible on your return (up to $12,500 single, $25,000 joint, for 2025–2028), and Pub 15 says employers must honor an updated W-4 that accounts for it. Entering $3,640 in Step 4(b):

• $60,560 − $3,640 = $56,920 → $1,240 + 12% × ($56,920 − $19,900) = $5,682.40 ÷ 52 = $109.28
• That's $13.51 more per week in your pocket now rather than at filing.

The no tax on overtime guide explains which overtime qualifies and the income limits.

Same worker, married with two children

If this worker is married filing jointly, the spouse doesn't work, and Step 3 lists 2 × $2,200 child tax credit = $4,400:

• $69,160 − $12,900 = $56,260 → $2,480 + 12% × $12,160 = $3,939.20 ÷ 52 = $75.75
• Credits: $4,400 ÷ 52 = $84.62
• $75.75 − $84.62 is below zero, so federal withholding is $0.

That's correct, not a payroll error: taxable income of $69,160 − $32,200 = $36,960 produces $3,939.20 of tax, which the $4,400 credit wipes out.

Why your withholding won't match your tax bill exactly

• Other income: a second job, a spouse's wages, interest, dividends, or freelance income aren't in your employer's math unless you enter them in W-4 Step 2 or 4(a).
• Itemized and new deductions: mortgage interest, the higher 2026 SALT cap, the senior deduction, or the tips and overtime deductions lower your tax only if you tell payroll via Step 4(b).
• Bonuses and commissions: these are often withheld at a flat 22%; the bonus tax calculator shows when that's too much or too little.
• Mid-year changes: a raise, a new job, or a new child changes the annual picture, but each paycheck is figured as if the current rate lasts all year.

Check your year-to-date withholding against your projected tax with the tax withholding calculator, and file a new W-4 if the gap is more than a few hundred dollars.

Common paycheck math mistakes

• Using the standard deduction instead of the table offset. Payroll subtracts $8,600 or $12,900 and then uses tables with a built-in zero band; subtracting the full $16,100 and then using the tax brackets gives the same answer, but mixing the two double-counts.
• Taking FICA off 401(k) money. Social Security and Medicare apply to wages before the 401(k) deferral.
• Using last year's numbers. The 2026 wage base is $184,500, and the brackets, standard deductions, and benefit limits all changed; the 2026 IRS inflation adjustments guide lists them.
• Forgetting local tax and state disability programs, which some states and cities withhold on top of state income tax.
• Assuming a bigger pre-tax deduction lowers net pay dollar for dollar. For a 22%-bracket worker in Texas, a $100 health FSA deduction lowers net pay by only $70.35, because it also cuts federal withholding ($22.00), Social Security ($6.20), and Medicare ($1.45).

Related tools

Run your own numbers in the paycheck after-tax calculator, see which bracket your income falls in with the federal tax bracket calculator, and compare payroll HSA contributions with an FSA using the HSA calculator.