Your take-home pay isn't random — it's the result of a predictable formula. Once you understand each piece, you can estimate your paycheck for any salary, state, or set of deductions. Here's how it all works.
The Formula
Net Pay = Gross Pay − Pre-Tax Deductions − Federal Tax − FICA − State Tax − Post-Tax Deductions
Each piece of that formula has its own calculation. Let's walk through each one.
Step 1: Start With Gross Pay
Gross pay is your earnings before anything is taken out.
- Salary: Annual salary ÷ pay periods per year (26 for biweekly, 24 for semi-monthly, 12 for monthly)
- Hourly: Hourly rate × hours worked (plus 1.5× rate for overtime hours above 40/week)
Step 2: Subtract Pre-Tax Deductions
Pre-tax deductions reduce the income that gets taxed:
- 401(k) contributions
- Health, dental, vision insurance premiums (if Section 125)
- HSA and FSA contributions
The result is your taxable wages — the number used for income tax calculations.
Step 3: Calculate Federal Income Tax
- Annualize your taxable wages (multiply per-check wages × pay periods)
- Subtract the standard deduction ($14,600 for single filers in 2025)
- Apply the tax brackets to what's left
- Divide the annual tax by the number of pay periods
Step 4: Calculate FICA Taxes
- Social Security: 6.2% of gross wages (applied to gross, not taxable wages) — capped at $176,100/year
- Medicare: 1.45% of all gross wages
- Additional Medicare: 0.9% on wages above $200,000 (single)
Step 5: Calculate State Income Tax
State calculations vary by state. For states with flat rates, it's simple multiplication. For states with brackets, you go through a similar process to federal — but using the state's standard deduction and brackets.
Nine states have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Step 6: Subtract Post-Tax Deductions
Roth 401(k) contributions, garnishments, and after-tax insurance premiums come out last.
Example: $65,000 Salary, Single, Texas, Biweekly
| Step | Calculation | Amount (per check) |
|---|---|---|
| Gross Pay | $65,000 ÷ 26 | $2,500.00 |
| Pre-Tax 401(k) (5%) | −$2,500 × 5% | −$125.00 |
| Taxable Wages | $2,375.00 | |
| Federal Income Tax | ~12% effective | −$270.00 |
| Social Security | 6.2% of $2,500 | −$155.00 |
| Medicare | 1.45% of $2,500 | −$36.25 |
| State Tax (TX) | 0% | $0 |
| Net Pay | ~$1,914 |
Skip the math. Use the PayCheckFox calculator to get an instant, accurate breakdown for your exact salary, state, filing status, and deductions.
Why Your Actual Check May Differ Slightly
Payroll software uses exact withholding tables published by the IRS, which produce slightly different results than the simplified bracket calculations above. The difference is usually a few dollars per check.
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