How it's calculated
The calculator works out a full year of pay and withholding, then divides by the number of paydays to show an average paycheck. It follows the same steps an employer's payroll system does.
It starts with your gross pay: your salary, or your hourly rate times your weekly hours (with overtime hours paid at time and a half) for every week of the year. Pre-tax deductions come off next: Section 125 health premiums, HSA contributions and traditional 401(k) deferrals.
Federal income tax withholding uses the IRS percentage method for automated payroll systems in Publication 15-T (2026), Worksheet 1A, with your Form W-4 entries.IRS Social Security and Medicare follow Publication 15, section 9.IRS State income tax, state payroll taxes and any local income tax come from your state's own employer withholding method for 2026, which is documented with its sources on each state page.
What is left after taxes and after-tax deductions is your take-home pay.
The formula
All amounts are annual until the last step.
- Gross pay = salary, or (hourly rate × hours per week + hourly rate × time and a half × overtime hours per week) × 52.
- Pre-tax deductions = health premiums per paycheck × paydays + HSA per paycheck × paydays + 401(k) percentage × gross pay. The 401(k) amount is capped at the 2026 employee deferral limit of $24,500.
- Federal income tax withholding (Publication 15-T Worksheet 1A):
- adjusted annual wage = (gross − pre-tax deductions) + W-4 Step 4(a) − Step 4(b) − $12,900 (married filing jointly) or $8,600 (other statuses), with that last amount skipped if the Step 2 box is checked;
- tentative tax = base amount + rate × (adjusted annual wage − row floor), from the 2026 annual percentage method table for your filing status (the Step 2 checkbox table if the box is checked);
- per paycheck = tentative tax ÷ paydays − Step 3 credits ÷ paydays (not below zero) + Step 4(c).
- Step 3 credits = children under 17 × $2,200 + other dependents × $500.
- FICA wages = gross − health premiums − HSA (401(k) deferrals stay in).
- Social Security = 6.2% × FICA wages, up to the $184,500 wage base.
- Medicare = 1.45% × FICA wages, plus 0.9% × FICA wages above $200,000.
- State and local = the state's income tax withholding, employee payroll taxes (such as disability or paid leave premiums) and the selected locality's income tax.
- Take-home pay = gross − pre-tax deductions − all taxes − after-tax deductions.
- Per paycheck = annual amount ÷ pay periods (52 weekly, 26 biweekly, 24 semimonthly, 12 monthly).
Worked example
A single filer in Illinois earning $60,000 a year, paid biweekly, contributing 5% to a traditional 401(k) and paying $100 per paycheck in pre-tax health premiums:
| Line | Every 2 weeks | Per year |
|---|---|---|
| Gross pay | $2,308 | $60,000 |
| 401(k) / 403(b) | -$115 | -$3,000 |
| Health premiums | -$100 | -$2,600 |
| Federal income tax | -$167 | -$4,348 |
| Social Security | -$137 | -$3,559 |
| Medicare | -$32 | -$832 |
| State income tax | -$98 | -$2,548 |
| Take-home pay | $1,658 | $43,113 |
Take-home pay is $1,658 per paycheck. Notice that the health premiums lower Social Security and Medicare as well as income tax, while the 401(k) deferral lowers only income tax. For the same salary with no deductions, take-home pay would be $1,829.
Assumptions and limitations
- One state, resident. You live and work in the same state, and in the locality you select. Multi-state situations, reciprocity agreements and nonresident rates are not modeled.
- An average paycheck. We divide annual amounts by the number of paydays. Real paychecks can differ late in the year: Social Security stops once you reach the wage base, and Additional Medicare Tax starts only once wages from your employer pass its threshold. Payroll may also round to the dollar, which Publication 15-T allows.
- A full, steady year. The calculator assumes the same pay every period for the whole year. It does not use year-to-date figures, so starting a job mid-year, a raise or unpaid leave will change your real withholding.
- 2020-or-later Form W-4. Withholding uses the current W-4 steps. Older forms with allowances are not modeled.
- Bonuses and commissions are not included. Supplemental wages are often withheld differently; use the bonus tax calculator.
- 401(k) catch-up contributions for people 50 and older are not modeled; deferrals stop at the standard employee limit.
- HSA contributions are treated as made through a Section 125 cafeteria plan. HSA contributions made outside a cafeteria plan are subject to FICA.
- New deductions. The tips, overtime, car loan interest and senior deductions reduce withholding only if you enter them in the W-4 Step 4(b) field, just as on a real W-4.
- Step 3 credits use the full per-dependent amounts. If your income is above the credit phase-out, the calculator shows a note, and your actual tax may be higher.
- State assumptions. Where a state has its own withholding certificate, we use the default a typical employee would claim and show that assumption as a note. States whose 2026 data is still being verified are labeled.
- Local taxes are included only for the localities listed for your state, at resident rates.
- Not included: employer-paid benefits, taxable fringe benefits, garnishment limits, nonresident alien adjustments and employer-only taxes.
- Withholding, not your final tax. Your actual tax is settled on your return. The federal income tax calculator estimates that side.
Our methodology explains how the data is sourced and tested.