Why Your Take-Home Pay is Less Than Your Salary
It is a common shock for new employees: you signed an offer letter for ,000, but your first paycheck feels much smaller. This is due to withholdings.
Your "Take-Home Pay" (or Net Pay) is what hits your bank account after the government and your employer take their shares. This calculator reveals exactly where that money goes.
The "Big Three" Deductions
- Federal Income Tax: Withheld based on the W-4 form you filled out.
- Social Security (6.2%): A flat tax that funds retirement benefits. Capped at a certain income level (,100 in 2025).
- Medicare (1.45%): Funds healthcare for seniors. There is no cap on this tax.
In addition to these, you may see deductions for 401(k) contributions, health insurance premiums, and state taxes.