How is salary after tax calculated in the US?

Deductions include Federal tax (10-37%), State tax (varies), Social Security (6.2%), and Medicare (1.45%).

Which states have no income tax?

Florida, Texas, Washington, Nevada, Wyoming, South Dakota, and Alaska.

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How Salary After Tax is Calculated in the United States

In the United States, your take-home pay is determined by several deductions from your gross salary. Understanding these deductions helps you plan your finances effectively.

Federal Income Tax

The US uses a progressive tax system with seven tax brackets ranging from 10% to 37%. Your income is taxed at different rates as it moves through each bracket. Currently, the brackets are: 10%, 12%, 22%, 24%, 32%, 35%, and 37%.

State Income Tax

State income tax varies significantly by state. Nine states have no income tax (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming), while others have rates ranging from around 3% to over 13% in California.

Social Security and Medicare

Social Security tax is 6.2% on earnings up to $160,200 (current limit). Medicare tax is 1.45% on all earnings with no cap. High earners may also pay an additional 0.9% Medicare tax on income above certain thresholds.