How Do You Calculate a Salary After Taxes?


Quick Answer

Calculate your salary after taxes by subtracting federal, state, municipal, payroll and unemployment taxes from your annual income, as Calculator.net indicates. Your take-home pay is what remains after deducting all taxes from your salary.

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Full Answer

If you are employed, your employer withholds tax and deductions from your paycheck, says Calculator.net. If you are self-employed, it is your responsibility to submit taxes annually or quarterly, as well as to pay for your own benefits, as the Internal Revenue Service indicates. The deductions you make from your pre-tax salary depend on your level of income and where in the United States you are located.

The federal tax is progressive and depends on your annual income, states Calculator.net. Most states have a state tax, which varies from 3.07 percent to 13.3 percent depending on the state you live in. Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming have no state tax. Some cities impose an additional local tax. Social Security and Medicare are included in the payroll tax; these expenses are progressive like the federal tax and are shared with your employer.

If you are an employer, you pay unemployment taxes for your employees without deducting from their paychecks, notes Calculator.net. If you are a self-employed individual, you must pay a self-employment tax, which replaces the payroll tax and depends on your income, according to the IRS.

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