How we calculate

1. Purpose

TakeHome estimates employee take-home pay for educational comparison — for example, comparing two job offers or two states. It is not payroll software, not tax-preparation software, and not an official IRS or state calculator.

When a number on your employer stub, a tax pro’s worksheet, or an agency tool disagrees with ours, treat our figure as the one that needs checking, not as the authority.

2. Calculation pipeline

At a high level, each run follows this sequence:

1. Convert your gross input into an annualized gross (and a per-period gross using your pay frequency)
2. Subtract modeled pre-tax amounts (such as traditional 401(k) % or amount, and other pre-tax per period)
3. Estimate employee FICA (Social Security and Medicare) on wage base after those pre-tax adjustments
4. Estimate federal income tax using either Withholding mode or Annual estimate mode
5. Estimate state income tax for supported states (or warn when a state is not modeled)
6. Subtract optional post-tax amounts
7. Report net pay per period and annualized, plus a breakdown and explanation steps

3. Withholding vs annual estimate

The two modes will often disagree. That difference is expected: paycheck withholding is not the same thing as final tax due.

4. Federal income tax (simplified)

Federal ordinary income tax is modeled with progressive brackets and a standard deduction amount keyed to filing status for the active tax year configuration in our engine.

We do not fully model itemized deductions, tax credits (Child Tax Credit, education credits, etc.), AMT, NIIT, capital gains stacking, or multi-job W-4 coordination. Extra withholding is a manual add-on per period, not a complete W-4 simulation.

5. FICA (Social Security & Medicare)

Employee Social Security is modeled at 6.2% up to the configured annual wage base. Employee Medicare is modeled at 1.45%, plus Additional Medicare Tax of 0.9% above the filing-status threshold used in our engine (simplified).

We apply FICA to wages after the pre-tax amounts we model. Employer-side FICA is not shown. Special wage types and refundable over-withholding situations are out of scope.

6. State & local tax coverage

Launch coverage provides modeled state-income-tax estimates for California, New York, Texas, Florida, Washington, Illinois, Pennsylvania, and Georgia. These are educational estimates, not official state withholding calculations.

Texas, Florida, and Washington are treated as having no state personal income tax in this model (federal + FICA still apply). Pennsylvania uses a flat-rate style model. Illinois and Georgia use simplified rate approaches. California and New York use simplified progressive bracket tables; married-joint bracket widths are approximated.

New York City local tax is optional and simplified when the NYC resident toggle is enabled. Other local taxes (including common Pennsylvania local earned income taxes) are not modeled. Selecting an unsupported state yields federal + FICA only, with an on-screen warning.

7. Inputs we accept (and ignore)

Supported inputs include gross amount and unit (annual, period, or hourly), pay frequency, state, filing status, traditional 401(k) percentage, extra federal withholding per period, optional other pre-tax / post-tax amounts, and NYC resident (NY only).

We do not currently model HSA/FSA detail beyond a generic “other pre-tax” field, Roth vs traditional nuances beyond the traditional 401(k) control, equity compensation, bonuses as separate supplemental withholding, tips, self-employment income, or dual-state remote work.

8. Period conversion & rounding

We use standard period counts: weekly 52, biweekly 26, semimonthly 24, monthly 12. Hourly gross annualizes as rate × hours/week × 52 (default 40 hours if blank).

Currency amounts are rounded to cents for display. Small differences versus payroll systems often come from rounding order and mid-year timing.

9. Sources & maintenance

Engine constants are maintained toward the labeled tax year and are inspired by public IRS / SSA / state frameworks (brackets, standard deduction style amounts, FICA rates and wage base, simplified state schedules). They are educational approximations and may lag or simplify official publications.

When agencies publish inflation adjustments or rate changes, we update the engine and revise this page’s “Last updated” date. See the changelog below for notable revisions.

Authoritative references for users verifying numbers include IRS withholding and tax publications, SSA wage-base announcements, and the relevant state department of revenue.

10. Changelog

• 2026-07-19 — Initial public methodology for MVP: federal simplified tax, FICA, eight-state launch set, withholding vs annual modes, optional NYC simplified local.