A job offer, a raise, or a move across state lines — the number that actually matters is not the salary printed on the offer letter. It is the amount that lands in your bank account each month after taxes and deductions. This net pay calculator converts your annual gross salary into a realistic take-home figure, accounting for FICA, federal income tax, state income tax, and any pre-tax retirement contributions you make.
Unlike a per-paycheck withholding tool, this estimator works on a full-year basis. You type your annual salary, your average federal tax rate, your state rate, and your 401(k) contribution percentage, and the result card instantly shows what you really keep each year and each month. It is built for quick budgeting, comparing offers, and understanding the real cost of living in different states.
How to Use
- Enter your Annual Gross Salary — the full yearly amount your employer pays before anything is withheld. This is the base salary, not including bonuses, overtime, or stock grants unless you choose to add them in.
- Set your Effective Federal Tax Rate. This is your average tax rate, not the highest bracket your income touches. Most single W-2 earners fall somewhere between 10% and 22%; if you do not know yours, pull last year's return and divide your total federal tax by your gross income.
- Enter your State Income Tax Rate. If you live in one of the no-income-tax states — Texas, Florida, Washington, Nevada, Wyoming, South Dakota, or Alaska — leave this at 0. California and New York earners often enter 6% to 10%.
- Add your Pre-Tax 401(k)/Retirement percentage if you contribute to a traditional 401(k), 403(b), or similar plan. This lowers your taxable income before FICA and income tax are applied.
- Read the result card: it breaks out FICA, federal tax, state tax, and your retirement contribution, then shows your Net Annual Take-Home and the monthly equivalent.
The model subtracts four items from your gross salary: pre-tax retirement contributions, FICA (Social Security and Medicare), federal income tax at your stated effective rate, and state income tax at your stated rate. Everything left is your net pay.
How Net Pay Is Calculated
The engine uses a simplified annual formula rather than a full payroll withholding table:
Net Annual = Gross Salary − Pre-Tax Retirement − FICA − Federal Tax − State Tax
Where FICA is always 7.65% of your taxable gross — that is 6.2% for Social Security up to the annual wage base plus 1.45% for Medicare with no cap. Federal and state income tax are applied at the flat effective rates you supply, on the income remaining after your pre-tax retirement contribution.
Worked example on a $75,000 salary with a 12% federal rate, 5% state rate, and no retirement contribution: FICA is $5,737.50, federal tax is $9,000, state tax is $3,750. Total deductions are $18,487.50, leaving $56,512.50 per year, or about $4,709 per month. Notice that the total tax take is roughly 24.7% of gross — higher than the 12% federal rate alone, because FICA and state tax sit on top.
This is why knowing only your federal bracket is misleading. A worker in the 22% federal bracket can easily lose 30% or more of gross income once FICA, state tax, and retirement contributions are combined.
Why Pre-Tax Retirement Matters
Contributing to a traditional 401(k) reduces the income that federal and state tax are calculated on. On a $100,000 salary with a 15% federal rate and 6% state rate, putting 10% into a 401(k) means $10,000 goes into your retirement account before tax, and your taxable gross drops to $90,000. FICA falls to $6,885, federal tax to $13,500, and state tax to $5,400. Your net take-home is $64,215 per year — you deferred $10,000 into your future self and lowered your current tax bill at the same time. Use the Pre-Tax Retirement slider to see how much a higher contribution lowers your monthly cash in hand.
Examples
Example 1 — The typical professional. An engineer earns $95,000, claims a 16% effective federal rate, lives in a state with 5% income tax, and contributes 8% to a 401(k). Pre-tax retirement is $7,600; taxable gross is $87,400; FICA is about $6,686; federal tax is about $13,984; state tax is about $4,370. Net annual take-home is roughly $62,360, or about $5,197 per month.
Example 2 — No-income-tax state. The same engineer moves from a 5% state to Texas (0% state tax). On a $95,000 salary with no retirement contribution, the missing 5% state tax saves about $4,750 per year — a concrete dollar figure that explains why high-earners relocate to no-tax states.
Example 3 — Six-figure household. A $1,000,000 salary at a 30% effective federal rate and 8% state rate carries $76,500 in FICA, $300,000 in federal tax, and $80,000 in state tax. Net annual take-home is $543,500 — a large number, but note that nearly 46% of gross is gone before you see it. Running this number before signing a senior offer prevents lifestyle miscalculation.
FAQ
What is the difference between net pay and gross pay?
Gross pay is the full salary your employer agrees to pay you, before any deductions. Net pay — also called take-home pay — is what remains after FICA, federal income tax, state income tax, and pre-tax deductions like 401(k) contributions are subtracted. Gross is the offer letter; net is the bank deposit.
How much is FICA on a typical salary?
FICA is 7.65% of your taxable gross: 6.2% for Social Security (capped at an annual wage base) plus 1.45% for Medicare with no upper limit. On a $75,000 salary that is $5,737.50 per year, split evenly between you and your employer on a W-2.
What effective federal tax rate should I enter?
Use your average rate, not your marginal bracket. Find it on last year's 1040 by dividing your total federal income tax by your total gross income. Most single filers earning $50,000–$120,000 land between 10% and 18%. If you enter your top marginal bracket instead, you will overstate your tax and understate your net pay.
Does this calculator account for my W-4 withholding?
No. This is a simplified annual estimator that uses flat effective rates. Your actual paycheck withholding depends on your W-4 elections, dependents, side income, and deductions, and is reconciled when you file your tax return each spring. Use this tool for planning; use your pay stub for the exact current number.
Are there states with no income tax?
Yes — Texas, Florida, Washington, Nevada, Wyoming, South Dakota, and Alaska levy no broad-based state income tax. New Hampshire and Washington tax only interest and dividend income. If you live in one of these, set the State Income Tax Rate to 0 to see the full saving.
How does a 401(k) contribution change my net pay?
A traditional 401(k) contribution lowers your taxable income before income tax is applied, so it reduces both federal and state tax. On a $100,000 salary at 15% federal and 6% state, contributing 10% ($10,000) costs you only about $6,815 in current take-home, because the contribution cuts $2,100 off your tax bill and moves the rest into your retirement account.
Disclaimer
This net pay calculator is provided for informational purposes only and does not constitute tax, legal, or financial advice. Estimates use simplified flat effective rates and do not reflect your personal W-4 elections, dependents, itemized deductions, credits, bonuses, equity compensation, local taxes, or year-end true-up. Actual take-home pay varies by employer, state, and individual tax situation. Always confirm your figures with your pay stub, a recent tax return, or a qualified tax professional before making financial decisions.