Gross pay is the number at the top of your paystub — the full amount you earned this pay period before anything comes out. Net pay is the number at the bottom, the amount that actually hits your bank account. The gap between them is not a mistake and it's not your employer keeping a cut. It's taxes and deductions.
Almost everyone's net pay is smaller than their gross, and for a lot of workers the difference is 25% or more. Here's what makes up that difference and how it's calculated.
What comes out, in order
Three things stand between your gross and your net:
FICA taxes. These are Social Security and Medicare, and they come out of nearly every paycheck by law. Social Security is 6.2% of your wages, Medicare is 1.45%. Together that's 7.65%. You can't turn these off. (See why Social Security and Medicare come out of your paycheck for where the money goes.)
Income tax withholding. This is federal income tax, plus state income tax if your state has one, plus local tax in a handful of cities. Unlike FICA, the amount here depends on your W-4 and your pay — it's an estimate of what you'll owe when you file your return, prepaid a little each paycheck.
Deductions. These are things you signed up for or that a court ordered: health insurance premiums, 401(k) contributions, an HSA, a garnishment. Some come out before taxes are calculated (pre-tax) and some after (post-tax). See pre-tax vs. post-tax deductions for why the order matters.
A worked example
Say you earn $3,000 in a two-week pay period, live in a no-income-tax state, and have no deductions. Here's the paycheck, using 2026 rates:
- Gross pay: $3,000.00
- Social Security (6.2%): −$186.00
- Medicare (1.45%): −$43.50
- Federal income tax withholding: −$276.00 (varies with your W-4)
- Net pay: $2,494.50
The two FICA lines are fixed percentages, so they're easy to predict. The federal withholding line moves around based on your W-4 and your total pay for the year — that's the number people are usually surprised by. If you had a 401(k) deduction or health insurance, those would come out too and would also change your taxable wages.
Why your net pay changes from check to check
Your gross can be the same two weeks running and your net still won't match. Common reasons:
- You crossed the Social Security wage base. In 2026 you stop paying the 6.2% once your wages for the year pass $184,500, so a high earner's later checks are bigger. Most people never hit this.
- Your federal withholding shifted because your year-to-date pay pushed you toward a higher bracket, or you updated your W-4.
- You got a bonus. Bonuses are usually taxed at a flat supplemental rate, so a bonus check has a different take-home percentage than a regular one.
- A deduction started, stopped, or changed — open enrollment, a new 401(k) rate, a garnishment ending.
To see exactly what came out of any check, open the paystub and read it top to bottom — the walkthrough is in how to read your paystub line by line.
Related: Read your paystub line by line · Pre-tax vs. post-tax deductions · Paystubs & tax documents.