Payroll Calculation Methodology

The calculator starts with gross pay from salary or hourly inputs and the selected pay frequency.

Pre-tax deductions such as 401(k), HSA, FSA, and other pre-tax deductions reduce federal taxable wages in the estimator.

Federal income tax withholding is estimated from 2026 IRS Publication 15-T Worksheet 1A, the automated percentage method for 2020-or-later W-4 inputs.

The W-4 Step 2 multiple jobs checkbox changes which IRS percentage-method schedule is used; when it is not checked, the Worksheet 1A standard-rate adjustment is applied before the annual percentage table.

Social Security and Medicare employee withholding are estimated from taxable wages and year-to-date wage inputs where relevant.

Additional Medicare is included where applicable based on the modeled wage thresholds.

Promoted 2026 state pages have official-source-backed withholding or no-income-tax treatment, tests, documentation, and public limitation copy.

States with unresolved official source blockers show state withholding warnings until their calculator-ready source pack is complete.

The v1 model does not cover every local tax, employer-specific benefit treatment, garnishment, reciprocity rule, supplemental wage edge case, or payroll provider setting.

W-4 Step 2 choices, multi-job situations, year-to-date context, and employer rounding can make actual payroll differ from the estimate.