How do you figure out your annual income?


Quick Answer

To calculate your annual gross income, determine the frequency of your payments, find the gross income amount in each one and calculate this amount by the appropriate amount of payments per year, recommends the Houston Chronicle. Use figures that reflect gross pay per period and not net pay after taxes and deductions. Differentiate between semimonthly pay periods and biweekly ones, as the latter result in two more payments a year.

Continue Reading

Full Answer

Employers commonly use monthly, semimonthly, biweekly or weekly pay periods, reports the Houston Chronicle. Establishing how often you get paid determines the amount of payments during the year. The monthly schedule results in 12 payments, the semimonthly schedule in 24 payments, the biweekly schedule in 26 payments and the weekly schedule in 52 payments.

After determining the amount of payments annually, find the gross amount for each pay period, suggests the Houston Chronicle. This amount is commonly listed on the pay stub under the label of "Gross Pay" or "Total Income." Multiply this amount by the total number of payments per year to get your annual income. "Net Pay," which is the amount of pay after taxes, medical insurance, and other deductions, is not the same thing as "Gross Pay."

Learn more about Income Tax

Related Questions