How it works
A paycheck has three big tax bites: federal income tax, state income tax, and FICA. Together, they typically eat 22-35% of gross pay before anything else is deducted.
Federal income tax uses a progressive bracket system - only the income within each bracket is taxed at that rate. State tax varies wildly: nine states have no income tax at all; California's top rate hits 13.3%. FICA is flat: 7.65% on most wages, with extras at the top.
net = gross − federal_tax − state_tax − FICA − pre_tax_deductions
Frequently asked
Why is my actual paycheck different from this?
Several reasons: your W-4 might have extra withholding, local city/county taxes, post-tax 401(k) Roth contributions, disability insurance, union dues, garnishments. Your employer might also have rounded calculations. The IRS true-up happens at tax filing time.
Should I contribute to traditional or Roth 401(k)?
Traditional reduces today's tax. Roth doesn't reduce taxes now but grows tax-free. If you expect to be in a lower bracket in retirement, traditional wins. If you expect higher, Roth wins. Most younger workers default to Roth; most peak-career workers default to traditional.
What states have no income tax?
As of 2026: Alaska, Florida, Nevada, New Hampshire (no wage tax, but taxes interest/dividends), South Dakota, Tennessee, Texas, Washington (with a capital gains tax on high earners), and Wyoming. Living in these states keeps the state line at zero, but property tax and sales tax can offset some of the savings.