Our Methodology

Last verified: November 14, 2026  ·  Tax year: 2026

Federal Income Tax Withholding

We use the percentage method in IRS Publication 15-T for a 2020 or later Form W-4, with 2026 tax brackets and standard deductions. The calculator supports each W-4 step:

• Filing status: single, married filing jointly, or head of household
• Step 2: multiple jobs or a working spouse
• Step 3: $2,200 per qualifying child under 17 and $500 per other dependent
• Step 4(a), 4(b), and 4(c): other income, deductions, and extra withholding per paycheck

Bonuses and commissions are withheld at the 22% federal supplemental rate.

Social Security and Medicare

Social Security is 6.2% of wages up to the 2026 wage base of $184,500. Medicare is 1.45% of all wages, plus an extra 0.9% on wages above $200,000 in a calendar year. If you enter your year-to-date pay, the calculator applies these limits to the current paycheck.

State Income Tax

For each state that taxes wages, we use the state’s 2026 employer withholding formula, the same math payroll software runs. By default, the calculator assumes no allowances on a state withholding form. For 17 states that use allowances (AR, DE, GA, HI, IA, IL, IN, MD, MI, NC, NJ, NY, OH, OK, OR, VA, and WV), you can enter your state allowances under Fine-tune my estimate.

State tax on a bonus is estimated by adding the bonus to regular wages. Some states use a flat supplemental rate instead, so your employer’s withholding on a bonus may differ.

State Payroll Programs

Employee contributions for state disability, paid leave, and similar programs are shown as separate lines. These include California SDI; New Jersey UI, SDI, and FLI; New York SDI and paid family leave; Washington Cares; paid leave programs in Colorado, Connecticut, Delaware, Maine, Massachusetts, Minnesota, and Oregon; Oregon’s statewide transit tax and Workers’ Benefit Fund; Rhode Island TDI; and employee unemployment contributions in Alaska and Pennsylvania. Hawaii TDI and Washington paid family and medical leave are not included.

Deductions

• Traditional 401(k) and 403(b): lower federal and state income tax, but not Social Security or Medicare. Pennsylvania still taxes these contributions.
• Health, dental, vision, FSA, and HSA through payroll: lower income tax, Social Security, and Medicare. California and New Jersey tax HSA contributions.
• Roth 401(k) and other after-tax deductions: come out after taxes are calculated.

Overtime

Overtime pay is your overtime hours times your base rate times the overtime multiplier you choose (1.5× by default). The base rate is your hourly wage, or your salary divided by 2,080 hours, unless you enter your own rate.

1099 and Gig Income

For 1099 income, the calculator estimates self-employment tax (15.3% of 92.35% of net earnings, with the Social Security part limited by the wage base), federal income tax after deducting half of self-employment tax, the standard deduction, and the 20% qualified business income deduction, plus state income tax where it applies. It assumes the income you enter is your only income.

How We Test the Calculator

We compare our results with major payroll software for every state that taxes wages, plus DC. Our tests cover different salaries and hourly wages, all four pay schedules, each filing status, W-4 settings, 401(k) contributions, health deductions, overtime, and bonuses. When a result differs, we trace it back to the official formula before changing anything.

What the Calculator Doesn’t Cover

• Local income taxes, such as New York City, Ohio and Pennsylvania local taxes, and Kentucky and Indiana county taxes. Maryland county tax is included at an assumed 3.3% rate.
• Living in one state and working in another
• Wage garnishments and other employer-specific deductions, unless you enter them as after-tax deductions
• Your final tax bill. Withholding is an estimate of tax paid during the year, not the tax you owe when you file.

How We Update

The IRS usually releases the next year’s Publication 15-T in December, and states publish new withholding formulas around the start of the year. We load and test new rules when they are released, then update the tax year shown on our pages. We don’t change the “last verified” date unless we actually re-check the calculator.

Update History

• November 14, 2026: Added state W-4 allowances for 17 states, the “Estimated taxes to set aside” result for 1099 income, and notes on tips and overtime deductions.
• November 12, 2026: Loaded 2026 federal and state withholding rules and completed testing against payroll software for all states that tax wages, plus DC.

Report an Error

If a result doesn’t look right, email [email protected] with your inputs and the result you expected. We review every report.