How We Calculate Take-Home Pay

Data Sources

Every number in the calculator traces back to an official government publication or a widely used authoritative compilation:

• Federal income tax brackets & standard deductions: IRS Revenue Procedure 2025-32, which sets the inflation-adjusted figures for tax year 2026.
• FICA (Social Security & Medicare): IRS Publication 15 (Circular E) and the Social Security Administration's annual wage base announcement ($184,500 for 2026).
• State income tax brackets, deductions & exemptions: individual state revenue department publications for tax year 2026, cross-checked against the Tax Foundation's annual state tax survey.
• Contribution limits (401(k), IRA, HSA, FSA): IRS Notice 2025-67.
• Occupation wages: U.S. Bureau of Labor Statistics, Occupational Employment and Wage Statistics (OEWS), May 2024 release — national and state median annual wages by occupation.

The Calculation, Step by Step

Every result on the site — the main calculator, salary pages, hourly pages, state pages, and occupation pages — comes from the same seven-step pipeline:

1. 1

   Subtract pre-tax contributions

   adjustedGross = gross − pre-tax contributions (traditional 401(k)/403(b)/457(b), traditional IRA, HSA, FSA). These reduce your taxable income before any tax is computed.

2. 2

   Apply the federal standard deduction

   federalTaxable = max(0, adjustedGross − standard deduction). For tax year 2026: $16,100 single, $32,200 married filing jointly, $24,150 head of household.

3. 3

   Compute federal income tax

   The 2026 progressive brackets are applied marginally to federalTaxable — each slice of income is taxed at its own bracket rate, not your top rate on everything.

4. 4

   Compute Social Security tax

   socialSecurity = min(adjustedGross, $184,500) × 6.2%. The 2026 wage base cap means income above $184,500 is not subject to Social Security tax.

5. 5

   Compute Medicare tax

   medicare = adjustedGross × 1.45%, plus the Additional Medicare Tax of 0.9% on income above $200,000 (single/HOH) or $250,000 (married filing jointly).

6. 6

   Compute state (and city) income tax

   Each state’s own rules are applied: its brackets or flat rate, its standard deduction and personal exemptions where applicable, or zero tax in the nine no-income-tax states. On city pages, local income tax is added for the eight cities that levy one.

7. 7

   Arrive at net pay

   netAnnual = gross − federal tax − Social Security − Medicare − state/local tax − pre-tax contributions. Post-tax contributions (Roth IRA, brokerage, 529) are then shown separately as netAfterInvestments = netAnnual − post-tax contributions.

The same logic is published as machine-readable JSON at /api/tax-data.json, so anyone can verify our numbers independently.

What We Include vs. What We Exclude

SalaryCalc.us is designed for the most common case: a W-2 employee filing as single, married filing jointly, or head of household, taking the standard deduction. Being precise about scope matters more than pretending to cover everything.

Because of these exclusions, results are estimates. For most single-income W-2 households they land close to actual withholding, but your final tax bill — especially with credits or itemized deductions — can differ meaningfully.

Known Limitations & Estimates

• City occupation wages are estimates. BLS publishes occupation medians nationally and by state, but our city-level occupation figures are derived by applying a metro-area wage index to national medians — they are not direct BLS city medians and should be read as approximations.
• State data reflects the latest enacted rates. States occasionally change rates mid-year or retroactively; we use the most recently enacted 2026 figures available at time of update.
• Withholding vs. liability. The calculator estimates annual tax liability, which is not identical to what appears on each paycheck — employer withholding formulas (IRS Publication 15-T) can differ from the annualized result, with differences reconciled at filing.
• BLS occupation wages lag by design. The May 2024 OEWS release is the underlying survey; actual current wages in fast-moving fields may be higher.

Update Cadence

We update all tax data annually when the IRS publishes its inflation adjustments (typically October or November of the preceding year) and as state revenue departments release their figures. Corrections are applied as soon as errors are identified, outside the annual cycle.

Found an Error?

Accuracy is the whole point of this site. If any bracket, rate, deduction, or wage figure looks wrong, please tell us — reports are checked against the primary source and corrected promptly.