How to Calculate Paycheck

A paycheck calculator estimates your take-home pay after federal, state, and FICA taxes plus other deductions. It helps you understand the gap between gross and net pay.

The Formula

Net Pay = Gross Pay - Federal Tax - State Tax - FICA - Deductions

Where:

NetNet Pay — Take-home amount after all deductions
GrossGross Pay — Total earnings before any deductions
FICAFICA Taxes — Social Security (6.2%) and Medicare (1.45%)
DeductionsOther Deductions — Health insurance, 401k, and benefits

Step-by-Step Example

Here's how to calculate paycheck step by step:

  1. 1Start with gross pay: Calculate your gross pay from salary or hourly rate times hours worked.
  2. 2Subtract FICA: Deduct 6.2% for Social Security and 1.45% for Medicare.
  3. 3Subtract income taxes: Deduct federal and state income tax based on your W-4 and bracket.
  4. 4Subtract other deductions: Remove pre-tax deductions like 401(k), health insurance, and HSA contributions.

Following these 4 steps gives you the final paycheck value.

Skip the Math

On a $5,000 gross biweekly paycheck, after ~$383 FICA, ~$500 federal tax, ~$200 state tax, and $250 in 401(k), your net pay is about $3,667.

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Why You Need This Calculation

  • Knowing your net paycheck helps you budget accurately and understand where your gross earnings go.

Common Mistakes

Forgetting pre-tax deductions reduce taxable income.

401(k) and HSA contributions lower your taxable income, saving you money.

Using the wrong filing status.

Ensure your W-4 matches your actual filing status for accurate withholding.

Ignoring state and local taxes.

Include all applicable state and local income taxes in your calculation.

Frequently Asked Questions