How We Calculate Take-Home Pay
Our full methodology — data sources, the exact calculation steps, what's included, what's not, and known limitations.
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
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
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
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
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
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
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
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.
Included
- Federal income tax (2026 progressive brackets)
- State income tax, all 50 states + DC
- Social Security (6.2% up to the wage base)
- Medicare (1.45%) + Additional Medicare (0.9%)
- Local income tax for 8 major cities (e.g. NYC, Philadelphia)
- State payroll levies — SDI, paid family & medical leave, long-term care, employee-paid unemployment (21 levies across 15 states)
- Pre-tax contributions: 401(k)/403(b)/457(b), traditional IRA, HSA, FSA
- Post-tax contributions: Roth accounts, brokerage, 529
Not Included
- Alternative Minimum Tax (AMT)
- Itemized deductions (we assume the standard deduction)
- Tax credits — Child Tax Credit, Earned Income Tax Credit, education credits, etc.
- County and school-district local income taxes
- Self-employment complexities beyond the dedicated 1099 tool
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.
State Payroll Levies
Fifteen states charge employees a mandatory payroll deduction that is neither income tax nor federal FICA — state disability insurance, paid family and medical leave, long-term care, employee-paid unemployment, and in Oregon a transit tax. Most salary calculators ignore them, which quietly overstates take-home. A Californian on $150,000 loses $1,950 a year to SDI alone; a Washingtonian on the same salary loses about $2,080 to PFML and WA Cares combined.
Every figure below was read off the administering agency’s own 2026 publication — linked on each row. These levies apply to FICA-style wages, so a traditional 401(k) contribution does not reduce them, while Section 125 money (HSA, FSA, dependent-care FSA) does.
Caveats worth knowing
- Delaware depends on employer size. Only employers with 25 or more staff owe all three coverages. We model that case (0.4% employee share). At 10–24 staff only parental leave applies and your share is 0.16%; under 10 staff there is no deduction at all.
- Employers may absorb more than the minimum. In Colorado, Massachusetts, Maine, Minnesota, Oregon and Washington the law sets a maximum employee share. We use that maximum, so if your employer covers extra, your real deduction is smaller.
- Hawaii and New York cap weekly, not annually. Hawaii TDI stops at $7.50 a week and New York DBL at 60¢ a week. We convert those to annual equivalents, which is exact for a steady full-year salary and approximate if your pay varies week to week.
- Some workers are exempt. WA Cares has a permanent exemption for people who opted out during the 2021–2022 window, and employers with an approved private plan may withhold differently.
- Self-employment is excluded. These are employee levies. Our 1099 tool does not apply them, though several states allow elective opt-in.
- Maryland is coming, but not yet. Maryland FAMLI was delayed; payroll deductions begin January 1, 2027 at a 0.45% employee share. We will add it when the tax year changes, not before.
Known Limitations & Estimates
- City wages are metro-area, not city-limits. City occupation figures are direct BLS OEWS metropolitan-area medians (May 2024), not national medians scaled by an index. But BLS reports by metropolitan statistical area, so “Seattle” means Seattle–Tacoma–Bellevue, not the city boundary. Each city page names the exact BLS area it uses. Where BLS publishes no estimate for an occupation in a metro, we fall back to the national median and label it.
- 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.