Methodology
How these numbers are calculated
Every figure on this site comes from one calculation, run with published rates. This page sets out that calculation step by step, names the document each rate comes from, and says plainly what the model does not do. If a number here disagrees with your pay stub, this page should let you work out which of you is right.
Last reviewed 2026-08-28. Tax year 2026.
The calculation, in order
- 1
Gross pay
A salary is taken as given. An hourly wage becomes rate times hours, plus 1.5x the rate for any overtime hours, multiplied by 52 weeks and divided by the number of pay periods. Weekly is 52 periods, biweekly 26, semi-monthly 24, monthly 12.
- 2
Pre-tax deductions
Subtracted from gross before income tax is figured. This covers traditional 401(k) and 403(b) contributions, HSA and FSA money, and Section 125 health, dental and vision premiums.
- 3
Annualize
The remaining wages are multiplied back up to a full year and any other income from W-4 step 4(a) is added. This is the annualized percentage method from IRS Publication 15-T, the same approach payroll software uses for the post-2020 W-4.
- 4
Federal taxable income
The 2026 standard deduction for your filing status is subtracted, along with anything entered in W-4 step 4(b). That is $16,100 single, $32,200 married filing jointly and $24,150 head of household, from IRS Rev. Proc. 2025-32.
- 5
Federal income tax
The taxable figure runs through the seven 2026 brackets, marginally, so only the dollars inside each band pay that band's rate. Dependent credits from W-4 step 3 are subtracted from the annual tax, then the result is divided back to one pay period and any extra withholding from step 4(c) is added.
- 6
Social Security and Medicare
Figured on gross wages, not on taxable wages. Social Security is 6.2% on the first $184,500 of 2026 wages. Medicare is 1.45% on everything, plus an additional 0.9% on wages above $200,000. That threshold applies to withholding at the same level for every filing status.
- 7
State income tax
The same annualized approach with the state's own brackets, flat rate and deduction. Nine states withhold nothing on wages. Each state page shows the rates used and the tax year they come from, because states adopt new rates on their own schedules rather than all in January.
- 8
State payroll programs
Where a state runs a mandatory employee-side deduction for disability or paid leave, it is applied to gross pay, up to that programme’s wage ceiling where it has one. This is the part of the model with the most room left in it, and states not on the list below are treated as having no such deduction, which understates withholding for a few of them. 10 states are currently modelled: Alaska (AK UI 0.5%), California (CA SDI 1.3%), Colorado (CO FAMLI 0.44%), Massachusetts (MA PFML 0.46%), New Jersey (NJ UI/WF/SWF 0.425% + NJ TDI 0.19% + NJ FLI 0.23%), New York (NY PFL 0.432%), Oregon (Paid Leave Oregon 0.6%), Pennsylvania (PA UC 0.07%), Rhode Island (RI TDI 1.1%), Washington (WA Cares 0.58% + WA PFML 0.8072%).
What this model does not do
An estimate that hides its limits is worth less than one that states them. These are the places where the figures here will differ from your actual paycheck, and why.
- Rounding against payroll software
- Payroll systems may use the wage-bracket tables in Publication 15-T rather than the percentage method, and they round at each step. Expect a difference of a few dollars per check against a real pay stub. A gap of more than that usually points to something on the W-4 or a benefit deduction rather than to the arithmetic.
- Pre-tax money and FICA
- Traditional 401(k) contributions lower income-tax wages but not Social Security and Medicare wages, and this model follows that rule. Section 125 health premiums lower both in reality, but here they only lower income-tax wages. If you pay health premiums pre-tax, the FICA figure shown is slightly high and your real net pay is slightly better than the estimate.
- Variable pay
- FICA is computed on annual wages and spread evenly across pay periods. That is accurate for steady pay. If your hours swing or a large bonus lands mid-year, the per-check split will differ from your stub even though the annual total is right.
- State withholding tables
- State income tax is annualized from published rates rather than run through each state's own withholding tables and allowance rules. The annual figure is sound. The per-check figure can differ where a state uses its own table structure.
- Local income tax
- Modelled only where a city genuinely taxes wages and the rate is published. New York City, Philadelphia, most Ohio cities and a handful of others have it built into their city pages. Elsewhere the local line is zero, which is correct for most of the country.
- Credits and deductions at filing
- This is a withholding estimate, not a tax return. It does not model the Earned Income Tax Credit, itemized deductions beyond what you enter in W-4 step 4(b), or the actual settling-up that happens when you file.
When each rate is refreshed
Payroll figures do not all change on 1 January, which is the most common reason a calculator goes quietly stale. These are the points in the year when each set of numbers is re-checked against its source.
| Figure | Reviewed |
|---|---|
| Federal brackets, standard deduction, retirement limits | Each autumn, when the IRS publishes the following year's revenue procedure |
| Social Security wage base and COLA | Each October, when SSA announces the adjustment |
| State income tax rates | As each state enacts them, which is rarely January for all states at once |
| State disability and paid-leave rates | Each January |
| Philadelphia wage tax | Each July 1 |
| State and city minimum wages | Each January, with a second pass in July and a Florida step each September 30 |
Sources
Federal figures come from the documents below. State figures come from that state's revenue department or statute, and are linked on each state page alongside the tax year they apply to.
- IRS Rev. Proc. 2025-32 (2026 inflation adjustments)
- IRS Publication 15-T, Federal Income Tax Withholding Methods
- IRS Publication 15, employer's tax guide
- Social Security Administration, 2026 COLA fact sheet
- US Department of Labor, FLSA overtime pay
- IRS, 401(k) contribution limits
- IRS, tax withholding estimator
- DailyPay, frequently asked questions (transfer speeds, limits and fees)
- DailyPay help center, how do next business day transfers work
- DailyPay help center, what happens on payday
- DailyPay client help center, cycle payment cut-off and delivery times
- TSA, 2026 Transportation Security Compensation Plan pay chart (effective Jan 11, 2026)
- TSA jobs, pay bands overview
- OPM, 2026 Rest of U.S. salary table (17.06% locality)
- NPR, TSA officers receive back pay as 2026 DHS partial shutdown continues
- IRS, what the no-tax-on-tips deduction means for you
- IRS, Schedule 1-A (Form 1040), Additional Deductions
- Congressional Research Service, taxation of tip income under the 2025 reconciliation law
- IRS, what to know about the no-tax-on-overtime deduction
- IRS, About Form W-4, Employee's Withholding Certificate
- IRS, Form W-4 (2026)
- IRS, tax withholding for individuals
- IRS, child tax credit
If a figure here is wrong
Rates change and documents get superseded. If something on this site disagrees with a primary source, the primary source wins and the site is the thing that needs fixing. The fastest way to check any single number is to open the source linked on that page and compare it directly. Every state page names the tax year its rates come from, so a figure carrying an older year than you expect is the first thing to look at.
This is an estimate for planning. It is not tax advice, and it does not replace your employer's payroll department or a tax professional for a decision that matters.
Back to the paycheck calculator, or read how to calculate take-home pay for the same math worked through by hand.