Why is my paycheck lower than expected?
Common reasons your take-home pay might be less than you calculated, and what you can do about it.
- •Gross pay and net pay are different—this is normal and expected
- •Tax withholding, FICA taxes, and deductions all reduce your take-home pay
- •Understanding each deduction helps you plan better and verify accuracy
- •If you consistently get large refunds, you may be over-withholding
Updated Jan 2026
Understanding the gap between gross and net pay
If you're seeing a smaller paycheck than expected, you're not alone. The difference between your gross pay (what you're promised) and net pay (what you actually receive) can be significant, and it's often not immediately obvious where that money goes.
Let's walk through the most common scenarios that reduce your take-home pay, so you can understand exactly what's happening and whether it's normal or something you should address.
Key takeaways:
- Gross pay and net pay are different—this is normal
- Multiple deductions reduce your take-home pay
- Understanding each deduction helps you plan better
Tax withholding: the biggest factor
Federal, state, and local income taxes are withheld from every paycheck. The amount depends on your income level, filing status, and the information you provided on your W-4 form. This is often the largest deduction from your paycheck.
Quick Check
Use our take-home pay calculator to see an estimated breakdown of your paycheck and understand where your money goes.
Your employer uses IRS withholding tables to estimate your annual tax liability and divides it across your pay periods. If you consistently receive large refunds, you're over-withholding and could adjust your W-4 to get more money in each paycheck.
Key takeaways:
- Income tax withholding is typically the largest deduction
- The amount depends on your income, filing status, and W-4 settings
- If you get large refunds, you may be over-withholding
Social Security and Medicare (FICA taxes)
These payroll taxes are automatically deducted from every paycheck, regardless of your income level or filing status. Unlike income tax, there's no way to reduce FICA taxes through deductions or credits.
Social Security tax is 6.2% of your income up to the wage base limit (which changes annually). Once you exceed this wage base, you stop paying Social Security tax for the rest of the year. For 2026, the wage base is $184,500.
Medicare tax is 1.45% on all income, with no cap. High earners pay an additional 0.9% on income over $200,000 (single) or $250,000 (married filing jointly).
For example, if you earn $100,000, you pay $6,200 in Social Security tax and $1,450 in Medicare tax annually—that's about $294 per bi-weekly paycheck for FICA taxes alone.
Key takeaways:
- FICA taxes are mandatory and can't be reduced
- Social Security tax stops after the wage base limit
- Medicare tax applies to all income, with an extra tax for high earners
Pre-tax deductions: reducing taxes but still reducing take-home pay
Pre-tax deductions like 401(k) contributions, health insurance premiums, and HSA contributions reduce your taxable income, which saves you money on taxes. However, they still reduce your take-home pay.
For example, if you contribute 10% to a 401(k) on a $100,000 salary, that's $10,000 annually or $385 per bi-weekly paycheck. While this saves you approximately $2,400-$3,000 in taxes (depending on your bracket), you still see $385 less in your paycheck.
Common pre-tax deductions include:
- 401(k) or 403(b) retirement contributions
- Health insurance premiums
- Health Savings Account (HSA) contributions
- Flexible Spending Account (FSA) contributions
- Commuter benefits (transit, parking)
Key takeaways:
- Pre-tax deductions reduce your taxable income and save on taxes
- They still reduce your take-home pay, but the tax savings make them worthwhile
- Common examples: 401(k), health insurance, HSA, FSA
Post-tax deductions: coming out after taxes
Post-tax deductions come out after taxes are calculated. These don't reduce your taxable income, but they still reduce your take-home pay.
Common post-tax deductions include:
- Roth 401(k) contributions
- Life insurance premiums
- Disability insurance
- Union dues
- Charitable contributions (if set up through payroll)
Key takeaways:
- Post-tax deductions don't reduce your taxable income
- They still reduce take-home pay but offer other benefits
- Roth 401(k) contributions are a common example
Pay frequency: why paycheck size varies
If you're comparing your annual salary to a single paycheck, the numbers might not add up due to pay frequency differences.
Bi-weekly (26 paychecks per year): Your annual salary divided by 26. For a $75,000 salary, that's $2,884.62 per paycheck.
Semi-monthly (24 paychecks per year): Your annual salary divided by 24. For a $75,000 salary, that's $3,125 per paycheck.
Monthly (12 paychecks per year): Your annual salary divided by 12. For a $75,000 salary, that's $6,250 per paycheck.
The annual total is the same, but bi-weekly paychecks are smaller because you receive two extra paychecks per year. This can make it seem like you're earning less, but you're actually earning the same amount annually.
Key takeaways:
- Pay frequency affects individual paycheck size, not annual income
- Bi-weekly paychecks are smaller but you get 26 per year
- Semi-monthly paychecks are larger but you get 24 per year
Want to see this with your numbers? Try the calculator with your numbers →
What to do next
Next steps to address this paycheck question or situation.
If your paycheck is lower than expected, here's what to do:
- Review your pay stub: Check every line item to see where your money is going. Look for gross pay, all tax withholdings, and all deductions.
- Verify your W-4 settings: If you're consistently getting large refunds, you may be over-withholding. Use the IRS Tax Withholding Estimator to see if you should adjust your W-4.
- Understand your deductions: Make sure you understand what each deduction is for and whether it's optional. Some deductions like health insurance are necessary, while others like additional 401(k) contributions are optional.
- Use our calculator: Enter your salary, state, filing status, and deductions into our take-home pay calculator to see an estimated breakdown and verify if your paycheck matches expectations.
- Talk to your employer: If something looks wrong on your pay stub, contact your employer's payroll department. They can explain any deductions you don't recognize.
Remember
A lower paycheck isn't necessarily wrong—it might just mean you're saving for retirement, paying for health insurance, or having the right amount of tax withheld. The key is understanding where your money is going.