Gross Pay vs Net Pay (2026): Reading Your Stub Line by Line

Two Numbers, One Stub

Gross pay is everything you earned this period. Net pay is what reaches your account. Every argument about a paycheck is really an argument about one of the lines between them.

Add your earnings side up in the gross pay calculator, then take it through the net pay calculator.

What Belongs in Gross Pay

• Regular hours at your normal rate
• Overtime hours at 1.5x (2x where state law, a contract or policy requires it)
• Shift differentials and on-call pay
• Reported tips and service charges
• Commissions
• Non-discretionary bonuses — production, attendance, safety
• Paid time off taken during the period

A week at $22 an hour with 40 regular and 6 overtime hours: $880 + $198 = $1,078 gross.

Note the trap: a non-discretionary bonus does more than sit in gross pay. It raises your regular rate for the weeks it covers, so extra overtime is owed on top. That recalculation is the single most common wage error we see on stubs — the multiple pay rates guide walks through the weighted average.

The Deduction Order

Payroll works in a fixed sequence, and the order changes what you pay:

• . Pre-tax deductions. Traditional 401(k), HSA, FSA, most health premiums. These come off before federal income tax is calculated.
• . Federal income tax. Applied to gross minus pre-tax items, using your W-4.
• . FICA. 6.2% Social Security up to the annual wage base plus 1.45% Medicare — calculated on full gross, not the reduced figure. This is why a 401(k) contribution cuts income tax but never FICA.
• . State and local tax. Usually on the same reduced wage figure as federal.
• . Post-tax deductions. Roth contributions, union dues, garnishments, wage advances.

Example on $1,078 gross for a single filer, 4% state, $60 health premium and 5% 401(k): roughly $54 retirement, $60 premium, $96 federal, $82 FICA, $39 state — about $747 net, or 69% of gross.

Three Checks Before You Complain

• . Verify hours first. Most disputes are hours, not rates. Compare the stub against your own record.
• . Check the overtime rate against the regular rate. If a bonus was paid, 1.5 × base rate is too low.
• . Confirm pre-tax items are actually pre-tax. A premium listed after tax costs you more than it should; ask payroll to confirm the plan is a Section 125 arrangement.

Why Overtime Feels Over-Taxed

It is not taxed at a special rate. Withholding tables annualise the period you were paid — a heavy overtime week looks like a much larger salary to the table, so more comes out. Your return settles the difference. The overtime tax calculator shows the actual after-tax value of extra hours.

Related Tools

• Timesheet calculator — total the punches before you total the pay
• Paycheck calculator — per-state withholding
• Bonus tax calculator — supplemental wage withholding