How We Calculate

Every answer on this site is worked out the way an employer’s payroll works it out, from the rules the IRS, the Commonwealth of Pennsylvania, the Department of Community and Economic Development (DCED) and the City of Philadelphia publish. This page explains each line of the pay stub, says what the calculators leave out, and lists every figure with its source. The figures on this site were last checked October 28, 2026.

One paycheck, in whole cents

We count money in whole cents. Each tax is worked out for one paycheck and rounded to the nearest cent once, at the end; half a cent goes up. The server and the calculator in your browser follow the same rules, and our tests check that the two agree to the cent on thousands of random paychecks.

A salary is divided by the number of paychecks in the year: 52 weekly, 26 every two weeks, 24 twice a month or 12 monthly. Hourly pay is the week’s pay (overtime hours at one and a half times your rate) times 52 weeks, divided by the number of paychecks, so a twice-a-month or monthly figure for hourly pay is an average. The stub shows your first paycheck of the year; the year column adds up every paycheck.

Federal income tax

We follow Worksheet 1A of IRS Publication 15-T (2026), the method automated payroll systems use:

1. One paycheck’s taxable pay is multiplied by the number of paychecks in the year.
2. For a W-4 from 2020 or later, other income from Step 4(a) is added and deductions from Step 4(b) are taken off. Unless the Step 2 box is ticked, a further $12,900 comes off for married filing jointly, or $8,600 for everyone else.
3. The result is looked up in the year’s percentage method table for your filing status: the standard table, or the Step 2 table when the box is ticked.
4. Step 3 credits come off the year’s tax: $2,200 for each child under 17 and $500 for each other dependent, only if your total income is $200,000 or less ($400,000 married filing jointly), as the W-4 says. We count this job’s pay for the year and Step 4(a).
5. The year’s tax is divided by the number of paychecks and rounded to the cent, and any extra withholding from Step 4(c) is added.

For a W-4 from 2019 or earlier, each allowance takes $4,300 off the year’s pay, and the married or the single table is used (the old forms had no head of household). Extra withholding from line 6 is added.

The IRS lets employers round each paycheck’s tax to whole dollars, so your stub can differ from ours by less than a dollar. We test our federal withholding against every amount in the IRS’s own 2026 wage bracket tables: all 4,350 of them, for weekly, every-two-weeks, twice-a-month and monthly pay, each filing status, with and without the Step 2 box.

Pre-tax 401(k), 403(b) and 457(b) savings, pre-tax health, dental and vision premiums, and HSA contributions taken from pay all come off before federal income tax. Roth savings and other after-tax deductions do not.

If you tick “Count my overtime deduction in Step 4(b)”, we add the year’s overtime premium (the “half” of time and a half) to Step 4(b), up to $12,500 ($25,000 married filing jointly), while this job’s pay and Step 4(a) stay under the W-4’s line of $150,000 ($300,000 married filing jointly). The deduction itself is claimed on your tax return; married people must file jointly to take it (IRS).

Social Security and Medicare

Social Security is 6.2% of each paycheck until your pay for the year reaches $184,500. Medicare is 1.45% of all of it. Once your pay for the year passes $200,000, employers also withhold 0.9% Additional Medicare tax on the pay above that line (IRS Publication 15 (2026)). We follow both lines paycheck by paycheck: the notes under the stub say after which paycheck Social Security stops and from which paycheck Additional Medicare starts.

Pennsylvania income tax

Employers withhold 3.07% of Pennsylvania-taxable pay from every paycheck: one rate, with no brackets and no allowances (Employer Withholding Information Guide, REV-415). Pennsylvania counts more of your pay than the IRS does. Your own contributions to a 401(k), 403(b), 457(b) or SIMPLE plan are taxable in Pennsylvania when you make them (the Department of Revenue's guide to gross compensation). Pre-tax health, dental and vision premiums under a qualifying Section 125 plan are not taxable, and neither are HSA contributions made through one.

No Pennsylvania income tax is withheld for residents of Indiana, Maryland, New Jersey, Ohio, Virginia or West Virginia who gave their employer form REV-419 (the employer withholds their home state’s tax instead), or for people who qualify for Tax Forgiveness and filed the same REV-419. Each has a box in the calculator.

Pennsylvania unemployment tax

Employees pay 0.07% of their gross pay to the state’s unemployment compensation (UC) fund, with no yearly limit (Labor and Industry: employee withholding). We work it out on gross pay before any deductions, as the Department of Labor & Industry defines gross wages; some payroll systems leave pre-tax health premiums out, a difference of 7 cents for every $100. Labor & Industry’s rounding rule (three decimal places, then the nearest cent) gives the same cents as rounding straight to the nearest cent.

Local earned income tax

Under Act 32, which covers all of Pennsylvania but Philadelphia, an employer withholds the higher of two rates: the total resident rate (municipality plus school district) where you live, and the non-resident rate where you work (DCED's Local Withholding Tax FAQs). Living outside Pennsylvania, your resident rate counts as 0%. Working from home, your home is your work place. Someone who works in the municipality they live in is not a non-resident of it, so only its resident rate applies: the law speaks of “the greater of the employee’s resident tax or the employee’s nonresident tax” (DCED's Act 32 manual). Like Pennsylvania income tax, this tax is on your pay after pre-tax health premiums and HSA contributions are taken off, with your 401(k) savings still counted in.

Philadelphia has its own Wage Tax: its resident rate (3.735%) for people who live there, wherever in Pennsylvania they work, and its non-resident rate (3.425%) for others who work in the city, for pay dates from July 1, 2026 (the city's Wage Tax page). It is on gross pay: the city counts 401(k) savings, pre-tax Section 125 benefits and HSA contributions as taxable. For someone who lives elsewhere in Pennsylvania and works in Philadelphia, only the city’s tax is withheld, and it counts against the home’s tax on the annual local return; where the home rate is higher, the notes say roughly how much more is owed at home.

The rates come from DCED’s register of all 2,619 municipality and school district pairs (EIT / PIT / LST Tax Registers (Real-Time)), with changes up to September 17, 2026.

Local services tax

The local services tax is owed where you work: up to $52 a year ($156 in Harrisburg and Scranton). Over $10 a year, each paycheck takes the yearly amount divided by the number of paychecks, rounded down to the cent, as Pennsylvania law says: $52 is $1.00 a week, $2.00 every two weeks, $2.16 twice a month or $4.33 a month. At $10 or less, we take it all from the first paycheck (DCED: Local Services Tax). If you tick the exemption box, we leave out each part of the tax, the municipality’s and the school district’s, whose low-income line (usually $12,000) your year’s pay is under; without it we take the tax, as an employer must.

Bonuses

For a bonus paid on its own, or shown as a separate amount on a paycheck, an employer may withhold federal income tax at a flat 22%, or add the bonus to a regular paycheck and withhold the difference it makes (the aggregate method). The part of a bonus over $1 million is withheld at 37% (IRS Publication 15); the calculator counts only the bonus you type toward that line. Pennsylvania taxes a bonus at 3.07% like any pay, and Social Security, Medicare, the unemployment tax and the local earned income tax apply as usual. The local services tax does not: it is a yearly amount taken with regular pay.

What the calculators leave out

• Other states’ income tax: we work out Pennsylvania’s taxes only.
• Tips, and the overtime deduction’s own limits beyond the W-4’s line.
• Rate changes during the year: the year column uses today’s rates throughout, though in Philadelphia pay dates before July 1, 2026 had slightly higher rates.
• Pre-tax commuter benefits, dependent care accounts, garnishments and union dues. Put an after-tax amount in “Other deductions after tax”.
• Non-governmental 457(b) plans with no trust, which Pennsylvania taxes when paid out: we treat every 457(b) like a 401(k).
• Local low-income exemptions claimed on the annual return, and Philadelphia’s lower rate for people with Tax Forgiveness, refunded after the year.
• Your employer’s own rounding, pay dates and benefit rules.

Where the figures come from

The federal figures are the IRS’s 2026 publications; Pennsylvania’s come from the Department of Revenue and the Department of Labor & Industry. The local rates come from DCED’s Real-Time register, refreshed nightly; DCED’s official register comes out each June 15 and December 15 for the half-year that follows. When new figures are published, we change ours, and every calculator and guide shows the day its figures were last checked. The table lists each figure with its source.

The 2026 rates and limits behind every Pennsylvania paycheck: Social Security, Medicare, federal withholding, Pennsylvania income and unemployment tax, local taxes, the Philadelphia wage tax and the 401(k) limit, each with the government publication it comes from.

Download this table (CSV, opens in Excel)

If something looks wrong

If an answer doesn’t match your pay stub, or a figure looks out of date, please tell us: see Corrections. Say what you typed and what your stub shows. The calculators are general information, not tax, legal or payroll advice; your employer’s payroll and your own tax return are what count.

Updated October 29, 2026