Paycheck Calculator

Federal income tax is calculated using the IRS percentage method from Publication 15-T. Your wages are adjusted for pre-tax deductions, annualized, and then the standard deduction is applied based on your filing status. The resulting taxable income is then taxed using progressive tax brackets ranging from 10% to 37%.

FICA (Federal Insurance Contributions Act) taxes fund Social Security and Medicare programs:

• Social Security: 6.2% of wages up to the annual wage base ($176,100 for 2025)
• Medicare: 1.45% of all wages with no limit
• Additional Medicare: High earners pay an extra 0.9% on wages above $200,000 (single) or $250,000 (married filing jointly)

Pre-tax deductions reduce your taxable income before taxes are calculated:

• 401(k) contributions: Reduce federal and state income tax, but are still subject to FICA taxes
• Health insurance & HSA/FSA: Under Section 125 cafeteria plans, these reduce both income taxes AND FICA taxes

The more you contribute pre-tax, the lower your tax withholding will be.

Your actual paycheck may differ due to:

• Your employer's specific payroll system and configurations
• Additional deductions not captured here (union dues, garnishments, etc.)
• Rounding differences in withholding calculations
• State and local taxes (entered manually in this calculator)
• Bonus or overtime pay taxed at different rates

The Social Security wage base is the maximum amount of earnings subject to Social Security tax each year. For 2025, this limit is $176,100. Once you've earned this amount in a calendar year, no more Social Security tax is withheld from your paychecks for the rest of that year.

To calculate your take-home pay, start with your gross pay and subtract:

• Federal income tax: Based on your tax bracket and filing status
• Social Security tax: 6.2% up to the annual wage base
• Medicare tax: 1.45%, plus 0.9% on earnings over $200,000

Note: This calculator currently uses 2025 federal tax tables from IRS Publication 15-T. It will be updated when 2026 withholding tables are released by the IRS. Your effective tax rate depends on your income level, deductions, and W-4 allowances.

Pre-tax deductions (401(k), health insurance, HSA, FSA) are taken from your gross pay before taxes are calculated, reducing your taxable income and lowering your tax bill.

Post-tax deductions (Roth 401(k), union dues, garnishments) are taken after taxes, so they don't reduce your current taxes but may offer other benefits like tax-free retirement withdrawals for Roth accounts.

Nine states have no state income tax on wages: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. New Hampshire and Tennessee only tax investment income, not wages.

Living in a no-income-tax state can save workers thousands of dollars annually compared to high-tax states like California (up to 13.3%) or New York.