Net pay is the number that matters for your budget. It's what lands in your bank account, and it's often a good deal smaller than the pay you were quoted.
Net pay = gross pay − taxes − deductions
What comes out of a paycheck
Taxes
| Deduction | 2026 rate or rule |
|---|---|
| Federal income tax | Withheld based on your W-4 and the federal brackets |
| Social Security | 6.2% of wages, up to $184,500 of wages for the year |
| Medicare | 1.45% of all wages |
| Additional Medicare | Extra 0.9% withheld on wages over $200,000 |
| State and local income tax | Varies. Some states have none. |
Social Security and Medicare together are often labeled FICA on pay stubs. Your employer pays a matching share of both, which doesn't come out of your paycheck.
Pre-tax deductions
These come out before income tax is figured, which lowers your taxable income:
- Traditional 401(k), 403(b), or similar retirement contributions (these still count for Social Security and Medicare)
- Health, dental, and vision premiums through a cafeteria plan
- Health savings account (HSA) and flexible spending account (FSA) contributions
After-tax deductions
These come out after taxes are calculated:
- Roth 401(k) contributions
- Some life or disability insurance
- Union dues
- Wage garnishments or child support orders
Example: from gross to net in 2026
A single filer earning $52,000 a year, paid every two weeks, contributing $100 per paycheck to a traditional 401(k), with no state income tax:
| Line | Per paycheck | Per year |
|---|---|---|
| Gross pay | $2,000.00 | $52,000.00 |
| Traditional 401(k) | −$100.00 | −$2,600.00 |
| Federal income tax (estimate) | −$144.15 | −$3,748.00 |
| Social Security | −$124.00 | −$3,224.00 |
| Medicare | −$29.00 | −$754.00 |
| Net pay | $1,602.85 | $41,674.00 |
The 401(k) contribution lowers federal income tax: taxable income is $52,000 − $2,600 − $16,100 standard deduction = $33,300. But Social Security and Medicare are still figured on the full $52,000.
Saving $100 a paycheck for retirement reduced net pay by only about $88, because of the income tax savings.
Estimate your own net pay with your filing status and deductions.
Open the Take-Home Pay EstimatorWhy your net pay might be different
Actual withholding often doesn't match a simple estimate:
- Your W-4. Extra withholding, credits you claimed, or a second job checkbox all change federal withholding.
- Payroll method. Employers use IRS withholding tables that treat each paycheck as if it repeats all year, so a big bonus check can be withheld at a higher rate.
- Supplemental pay. Bonuses are often withheld at a flat federal rate.
- The Social Security cap. If you earn more than the wage base, Social Security withholding stops for the rest of the year, and your net pay goes up.
What's withheld is a prepayment. Your actual income tax is settled when you file your return, which is why you may get a refund or owe.
How to change your net pay
- Update your W-4 if you're consistently getting large refunds or owing. The IRS Tax Withholding Estimator can help you figure out what to enter.
- Adjust pre-tax contributions. More 401(k) or HSA contributions lower net pay now but reduce taxable income.
- Review your benefits during open enrollment. Premium differences between plans can add up per paycheck.
Common questions
Is net pay the same as take-home pay?
Yes. They mean the same thing.
Should I budget with gross or net pay?
Net pay. That's the money you can actually spend or save. Use the Budget Calculator with your net monthly income.
How do I find my monthly net pay if I'm paid every two weeks?
Multiply your net paycheck by 26 and divide by 12. $1,600 every two weeks is about $3,467 a month on average.