Your pay stub shows a smaller number than your salary. This guide explains where the difference goes in 2026.
What comes out of your pay
- Federal income tax. Worked out from your income after the standard deduction, using tax brackets.
- Social Security. 6.2% of your pay, up to $184,500 a year.
- Medicare. 1.45% of all your pay, plus 0.9% on pay above $200,000 ($250,000 if you file jointly).
- State and local tax. Depends on where you live. Some states have none.
- Your choices. 401(k) savings and health insurance.
A worked example
You are single and earn $100,000, with nothing else taken out.
| A year | |
|---|---|
| Pay | $100,000 |
| Standard deduction | $16,100 |
| Federal income tax | $13,170 |
| Social Security | $6,200 |
| Medicare | $1,450 |
| Take-home pay | $79,180 |
Try your own pay in the take-home pay calculator.
How tax brackets work
Each bracket taxes only the slice of income inside it. For a single person in 2026, the first $12,400 of taxable income is taxed at 10%, the next slice up to $50,400 at 12%, and so on. Moving into a higher bracket does not tax all your income at the higher rate. In the example, taxable income is $83,900, which reaches the 22% bracket, but the average federal rate is about 13%.
What a 401(k) does
A traditional 401(k) comes out before income tax. If you put in 10% ($10,000), your federal tax falls from $13,170 to $10,970, a saving of $2,200. Your take-home pay falls by $7,800, not $10,000. A 401(k) does not lower Social Security or Medicare tax.
What this leaves out
- Tax credits, such as the child tax credit.
- Extra deductions, such as those for people 65 and over, and itemised deductions.
- Other income.
- Local taxes and state differences beyond the rate you enter.
- Pay stub details such as your employer's withholding choices.
Your pay stub is the final word. This is general information, not tax advice.
Take-home pay calculator Enter your salary to see your take-home pay.Sources
- IRS: 2026 tax inflation adjustments
- IRS Rev. Proc. 2025-32 (2026 tax tables)
- IRS: Social Security and Medicare withholding rates
- IRS: Additional Medicare Tax
This article is for education and is not financial, tax or legal advice. Figures are checked against the sources above and may change. Read the full disclaimer.