Take-Home Pay — Definition and What It Means for Your Income
Your actual paycheck amount after all taxes and deductions.
Take-home pay is the amount of money you actually receive in your paycheck after federal income tax, state income tax, FICA (Social Security and Medicare), and any other deductions are withheld.
Source: IRS Publication 15Source: Tax Foundation
Why it matters
Take-home pay — not gross salary — is what you actually have available for housing, expenses, and savings. Comparing job offers by gross salary alone can be misleading.
Example
A $70,000 gross salary might result in approximately $4,400-$4,700/month take-home pay in a no-income-tax state, versus approximately $3,900-$4,200/month in a high-tax state like California.
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FAQ
Take-Home Pay — FAQ
What deductions reduce take-home pay?
The main deductions are federal income tax, state income tax (where applicable), Social Security (6.2%), and Medicare (1.45%).