What Is Taken From Your Gross Pay?
Your gross pay is the headline number on the offer letter. Your net pay is what lands in your bank account. Between them sits a stack of deductions that typically eats 25 to 35 percent of every paycheck: pre-tax benefits, federal income tax, Social Security and Medicare, state taxes, and a few post-tax items. Take a $75,000 salary: after a $6,000 401(k) contribution, federal tax of about $6,890 and FICA of $5,738 (all 2026 estimates for a single filer), the rest depends on your state. Below is each layer in the order it appears on your pay stub. Want the quick version for your situation? Our paycheck calculator does this math for your state in seconds.
The short answer
Deductions come off your gross pay in a fixed order. First, pre-tax benefits like your 401(k) and health premiums, which shrink the income your taxes are calculated on. Then federal income tax, then Social Security and Medicare (FICA), then state and local taxes. Finally, post-tax items like Roth 401(k) contributions and garnishments. What's left is your net pay: the number that actually hits your account. The order matters, because each layer changes the math for the layers below it.
Pre-tax deductions come first
Before any tax is calculated, your employer subtracts pre-tax deductions from gross pay. The big three: 401(k) contributions, HSA contributions, and health, dental, and vision insurance premiums. These come out of the paycheck before income tax touches it, which lowers your "taxable wages," the number federal and state taxes are computed on.
In our $75,000 example, a $6,000 annual 401(k) contribution drops taxable wages to $69,000. At a 22% marginal rate, that single move saves roughly $1,320 in federal tax for the year. Not bad for money that was going to your future self anyway.
One wrinkle people get wrong: a 401(k) lowers your income tax, but it does not lower Social Security and Medicare taxes. Those are calculated on your full gross pay (minus a couple of narrow exceptions like HSA contributions, which do reduce FICA too). So in the example, FICA is still figured on the whole $75,000. All figures here are 2026 estimates; the assumptions are spelled out at our methodology page.
See every deduction on your own paycheck
Enter your salary, 401(k), and state to get a line-by-line breakdown.
Break down my paycheck →Federal and FICA
Once pre-tax deductions are out, two federal line items hit. First, federal income tax: progressive, meaning higher slices of income get taxed at higher rates. On $69,000 of taxable wages for a single filer, the 2026 estimate comes to about $6,890 for the year. Second, FICA: a flat 7.65% with no brackets and no standard deduction: 6.2% for Social Security plus 1.45% for Medicare. On the full $75,000 gross, that's $5,738 a year, or about $220 from every biweekly paycheck, and there's no way to shrink it with deductions.
Worth knowing: the federal income tax withheld from each paycheck is your employer's estimate based on the W-4 you filled out. The real bill gets settled when you file your return. If too much was withheld, you get a refund. Too little, and you owe. FICA, on the other hand, is exact. What comes out is what you owe, period.
| Step on a $75,000 salary (8% 401(k)) | Amount |
|---|---|
| Gross pay | $75,000 |
| 401(k) contribution (8%, pre-tax) | −$6,000 |
| Wages the federal tax sees | $69,000 |
| Federal income tax (after the $16,100 standard deduction) | −$6,350 |
| FICA — Social Security + Medicare (7.65% of full gross) | −$5,738 |
| Take-home before state tax | $56,913 |
State takes its cut (or doesn't)
After federal comes the line that varies most: state and local income tax. Nine states (Texas, Florida, Washington, and friends) charge zero income tax on wages, so this line simply doesn't exist there. At the other end, California's top marginal rate reaches 13.3%, and states like New York add city taxes on top.
A few states tack on extras beyond plain income tax: California's disability insurance (1.3% of wages), New Jersey's family leave and disability funds, and similar programs elsewhere. These usually hide on the stub under cryptic abbreviations, which is why a move across state lines can change your take-home more than the headline tax rate suggests. If you want to decode each line on an actual stub, our guide to reading your pay stub line by line translates every abbreviation.
Post-tax deductions
The last layer comes out after all taxes are calculated, so these don't reduce your taxable income one bit. The most common: Roth 401(k) contributions: you pay tax on the money now so it grows tax-free later. Then the involuntary ones: wage garnishments for child support, defaulted student loans, or court judgments, which your employer is legally required to withhold. Union dues and some after-tax insurance premiums land here too.
People sometimes ask why anyone would choose Roth (post-tax) over traditional (pre-tax) 401(k). The honest answer: it depends on whether you think your tax rate will be higher now or in retirement. Young earners in low brackets often come out ahead with Roth. There's no universal right answer, just your situation.
Why equal salaries pay differently
This is the part that confuses everyone. Two people, same company, same $75,000 salary — and different take-home pay. Here's why that happens all the time:
- Different 401(k) rates. One contributes 10%, the other 3%. That's $5,250 a year apart before taxes even start.
- Different states. Same salary in Texas vs. California can mean thousands apart in take-home, as our state comparison shows.
- Different benefits. The family health plan costs far more per paycheck than single coverage, and HSA contributions vary.
- Different W-4s. Filing status and extra withholding change what's taken each payday (though not the final annual bill).
- Garnishments. Invisible on the offer letter, very visible on the stub.
So when a coworker mentions their take-home and it doesn't match yours, don't assume someone's payroll is broken. The gross was never the whole story.
Stop guessing your take-home pay
Plug in your salary and deductions for an exact 2026-estimate breakdown.
Calculate my net pay →The bottom line
From gross to net, your pay passes through five layers: pre-tax deductions, federal income tax, FICA, state taxes, and post-tax items, in that order, every payday. On a $75,000 salary with a $6,000 401(k), that means about $6,890 in federal tax and $5,738 in FICA (2026 estimates), with the state line deciding much of the rest. Knowing the order turns a confusing stub into simple arithmetic, and the paycheck calculator will run your exact numbers whenever you're ready.