Every US worker has looked at their paycheck and wondered why the number is so much lower than their stated salary. Federal income tax, state income tax, Social Security, Medicare — there are multiple deductions between your gross salary and what actually lands in your bank account. This guide explains each one clearly.
Your gross salary is the total amount your employer pays you before any deductions. Your net salary — also called your after-taxes salary or take-home pay — is what remains after all mandatory deductions. The gap between the two is often larger than people expect, especially in high-tax states.
The federal government applies a progressive tax system with seven brackets in 2026, ranging from 10% to 37%. The word "progressive" means you only pay each rate on the income within that bracket — not on your entire salary. A single filer earning $80,000 does NOT pay 22% on the whole $80,000. They pay 10% on the first $11,925, 12% on the next $36,550, and 22% on the remaining income above the 12% threshold.
Before applying brackets, you subtract the standard deduction ($15,000 for single filers in 2026) to get your taxable income.
All employees pay 6.2% of their wages in Social Security tax, up to a wage base of $176,100 in 2026. Once you earn above $176,100, you stop paying Social Security tax for the rest of the year. Your employer also pays 6.2% on your behalf, meaning the total Social Security contribution is 12.4% of your wages.
Medicare tax is 1.45% of all your wages with no cap. Unlike Social Security, there is no upper limit on Medicare tax. Workers earning above $200,000 (single) also pay an additional 0.9% in Additional Medicare Tax on income above that threshold.
State income tax varies dramatically. Nine states — Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming — have no state income tax on wages. The remaining 41 states and the District of Columbia apply their own tax systems, ranging from flat rates as low as 2.5% (Arizona) to progressive rates as high as 13.3% (California).
Many workers can reduce their taxable income through pre-tax deductions. Contributing to a 401(k) or 403(b) retirement plan reduces your federal (and often state) taxable income by the amount contributed. Employer-sponsored health insurance premiums are typically paid pre-tax. In 2026, the maximum 401(k) contribution is $23,500 for workers under 50.
On a $75,000 gross salary as a single filer in 2026, here is what you take home in different states:
Texas (no state tax): approximately $57,800/year ($4,817/month)
Ohio: approximately $55,900/year ($4,658/month)
New York: approximately $53,400/year ($4,450/month)
California: approximately $52,100/year ($4,342/month)
The difference between the highest and lowest state tax burdens on the same salary can exceed $5,000 per year.
Enter your gross salary, choose your state and filing status, and see your complete breakdown instantly — including federal tax by bracket, state income tax, Social Security, and Medicare. All updated for 2026.
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