Take-Home Pay Calculator
The salary on your offer letter is not the number that hits your bank account. Federal taxes, state taxes, Social Security, Medicare, health insurance, and retirement contributions all come out before you see a dime — and the gap is often $10,000 to $20,000 a year on a mid-range salary. This calculator shows you the real deposit number. Enter your gross annual pay and an estimated combined deduction rate, and it returns your net annual income and monthly take-home amount. Use it before accepting an offer, before signing a lease, or any time the paycheck feels smaller than it should.
How It Works
Take-home pay is what remains after every withholding is applied. The effective deduction rate combines federal income tax, state income tax, FICA taxes (Social Security 6.2% + Medicare 1.45%), and any pre-tax deductions like health insurance or 401(k) contributions. Because every person's exact withholding depends on their state, filing status, and benefit elections, this calculator uses a single combined rate you supply rather than computing each line separately.
A useful starting range for most US workers: 20–25% at lower incomes, 25–32% in the middle, 30–38% at higher incomes. Check a recent pay stub — divide total withheld by gross pay for that period to find your personal effective rate. Once you have your net annual figure, dividing by 12 gives you the monthly amount that actually lands.
Worked Examples
Example 1 — the mid-range reality check. Gross salary: $70,000. Effective deduction rate: 27%. Net pay = $70,000 × 0.73 = $51,100 per year — about $4,258 per month. An $18,900 gap between the offer and the deposit.
Example 2 — higher income, bigger gap. Gross: $110,000. Rate: 32%. Net = $110,000 × 0.68 = $74,800 per year — about $6,233 per month. More than $35,000 withheld before you see it.
Example 3 — lower income. Gross: $42,000. Rate: 19%. Net = $42,000 × 0.81 = $34,020 per year — about $2,835 per month.
When to Use This Calculator
Use this calculator before making any financial commitment that depends on real deposit income:
- Before accepting a job offer — so the salary number in the email reflects actual monthly cash, not a figure that disappears in withholding.
- Before signing a lease — landlords often use gross income to assess rent-to-income ratios, but you pay rent from net income.
- When a raise doesn't feel like a raise — run both the old and new salary to see exactly what the raise adds per paycheck, not on paper.
- When budgeting month to month — every budget should start from net, not gross. If yours starts from gross, every line item is optimistic.
Frequently Asked Questions
Why is my take-home so much lower than my salary?
Several deductions happen before you see the money: federal income tax (10–37% depending on your bracket), state income tax (0–13% depending on your state), Social Security (6.2%), Medicare (1.45%), and any health insurance or retirement contributions you've elected. Combined, these typically remove 20–35% of gross pay for most workers — meaning a $70,000 salary commonly produces between $45,000 and $56,000 in actual take-home, depending on your situation.
What deduction rate should I enter?
Pull a recent pay stub and divide total withholding by your gross pay for that period. That gives you your personal effective rate. If you're estimating for a new job, a rough starting point: 22–25% for incomes under $60k, 25–30% for $60k–$100k, 30–35% for $100k–$150k. These are estimates — your state, filing status, and benefit elections all shift the number.
Does this include retirement contributions and health insurance?
Only if you include them in your deduction rate. Pre-tax 401(k) and health insurance premiums reduce your taxable income before federal and state tax is calculated. If you want them reflected in your take-home estimate, add them to your combined rate. For example, if your tax withholding rate is 24% and you put 6% into a 401(k) plus 2% for health insurance, your combined rate would be roughly 32%.