How to Figure Your Own Payroll Deductions

If you need to know what the amount of your payroll check will be before you receive it, you can figure your own payroll deductions. You need to figure the federal, state, Social Security and Medicare taxes to subtract from your gross earnings in order to find your net pay, which is what you will receive on payday. You must also subtract any other deductions that may come off your gross pay each payday.

Step 1

Figure the Social Security tax that will be subtracted from your gross wages. The Social Security rate is 6.2% (.062). For example, if your gross earnings are $640 for the pay period, your calculation would be 640 x.062 = 39.68.

Step 2

Calculate how much Medicare tax, which is 1.45% (.0145), to withhold from your gross earnings. For example, gross wages of $640 will be 640 x .0145 = 9.28.

Step 3

Subtract any pre-tax deductions from the gross earnings. For example, if your gross earnings are $640 and you put $40 per pay period into a 401(k) or another qualifying plan, you would take 640 – 40 = 600, which will be the gross earnings that you use to calculate your federal and state tax withholding. If you have no pre-tax deductions, skip to the next step (and in this example, you would use $640 to figure your federal and state taxes rather than the $600 shown below).

Step 4

Figure the federal tax using the status and allowance information you entered on the W-4 form that was filled out when you were hired by the employer. For example, if you claimed single status with one allowance and are paid bi-weekly, you would find the correct tax in a table in Publication 15-T, starting on page 11. For a single person, paid bi-weekly claiming one allowance, the federal tax on $600 is $23.

Step 5

Calculate the state tax by using your state's tax tables. For example, if your gross income after pre-tax deduction is $600 and you live in Wisconsin, claim one exemption on your W-4, are paid biweekly and are single, your tax would be $22.40.

Find your gross pay using this calculation: $640 (gross) - $40 (pre-tax deduction) – $39.68 (SS) – $9.28 (Medicare) – $23 (federal) – $22.40 (state) = $505.64 (net earnings).

Tip

Union dues and any garnishments are subtracted from the net earnings.

Things You'll Need

  • Publication 15-T

  • State tax tables

  • Gross earnings

references