1. What is Net Pay?

Net pay, often called "take-home pay," is the amount of money an employee receives after all deductions have been taken from their gross pay. These deductions typically include federal and state taxes, Social Security and Medicare taxes (FICA), and any other voluntary or mandatory deductions.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• Gross Pay — Total earnings before any deductions
• Federal Tax — Amount withheld for federal income tax
• State Tax — Amount withheld for state income tax
• FICA — Social Security and Medicare taxes (7.65% of gross pay typically)

3. Importance of Net Pay Calculation

Details: Understanding your net pay helps with personal budgeting, financial planning, and ensuring proper tax withholdings. It's the actual amount you'll receive in your paycheck.

4. Using the Calculator

Tips: Enter all amounts in dollars. For accurate results, use values from your pay stub. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between gross pay and net pay?
A: Gross pay is your total earnings before deductions, while net pay is what you actually receive after all deductions.

Q2: How can I find my exact tax withholdings?
A: Check your most recent pay stub or W-4 form. Your employer calculates withholdings based on your W-4 information.

Q3: What is included in FICA?
A: FICA includes Social Security tax (6.2%) and Medicare tax (1.45%), totaling 7.65% of gross pay.

Q4: Are there other deductions not included here?
A: Yes, this calculator covers basic deductions. Other deductions might include health insurance, retirement contributions, or wage garnishments.

Q5: Why is my net pay different than I expected?
A: Differences can occur due to changes in tax laws, incorrect W-4 information, or additional deductions not accounted for in this basic calculator.