How to calculate take-home pay

The example: single filer, $65,000 salary, paid every two weeks (26 checks), putting $150 per check into a traditional 401(k), living in a state with no income tax. If you'd rather skip the arithmetic, the online paycheck calculator runs all five steps at once for any state.

Step 1: Find gross pay per period

Salary ÷ pay periods: $65,000 ÷ 26 = $2,500.00 per biweekly check. Hourly workers multiply rate × hours (overtime hours at 1.5×) per week, then × 2 for biweekly. If you're not sure how many checks a year you get, weekly is 52, biweekly 26, semimonthly 24, monthly 12.

Step 2: Subtract pre-tax deductions

Traditional 401(k), HSA, FSA and Section 125 health premiums come out before tax: $2,500.00 − $150 = $2,350.00 of federally taxable wages per check ($61,100 a year). One subtlety: 401(k) money still pays Social Security and Medicare; health premiums through a Section 125 plan escape those too.

Step 3: Compute federal income tax

Annualize taxable wages, subtract the standard deduction for your W-4 filing status ($16,100 single in 2026), and run the result through the brackets:

• Taxable income: $61,100 − $16,100 = $45,000
• Federal tax on that, sliced through the marginal brackets: $5,152 a year
• Per check: $5,152 ÷ 26 ≈ $198.15

W-4 step 3 dependent credits come off this number ($2,000+ per child per year), and step 4(c) extra withholding gets added. The full bracket table is in how much tax is taken out of a paycheck.

Step 4: Compute FICA

• Social Security: 6.2% of gross wages (up to $184,500 a year): $2,500.00 × 6.2% = $155.00
• Medicare: 1.5% of gross, no cap: $36.25 (an extra 0.9% starts above $200,000 of annual wages)

Note FICA applies to gross wages minus Section 125 premiums, not to the 401(k)-reduced figure.

Step 5: Subtract state tax and post-tax deductions

Our example state withholds nothing. Elsewhere, repeat step 3 with your state's own rates and deductions: a flat 2.5% in Arizona, progressive brackets up to 13.3% in California; each state's page on the state index lists its rates. Finally subtract post-tax items (Roth 401(k), union dues, garnishments).

The result

• Gross per check: $2,500.00
• 401(k): −$150
• Federal income tax: −$198.15
• Social Security: −$155.00
• Medicare: −$36.25
• Take-home pay: $1,960.60 per check, $50,976 a year (15.6% effective tax)

That's the whole calculation. Check your own numbers with the take-home pay calculator, and if your stub disagrees by more than a few dollars, the culprit is almost always the W-4 or a deduction you forgot was pre-tax; see gross pay vs. net pay for the classification.