To calculate take home pay, just add all deductions and then subtract the total deductions from the gross pay.
Definition of take home pay: Also called net pay, the take home pay is the money that is left after all deductions have been subtracted from the gross pay.
Definition of deductions: All money taken away from your gross pay
Definition of gross pay: The amount of money paid to an employee before deductions
Take home pay = Gross pay - deductions
Example #1:
Steve is a computer programmer and he works 35 hours a week. Steve gets paid $25 / per hour. Calculate take home pay
The following are deductions from Steve's paycheck:
Federal tax: $130
State tax : $25
Health insurance: $80
Medicare tax: $52
Disability: $12
Union dues: $21
First, calculate total deductions:
Total deductions = Federal tax + State tax + Health insurance + Medicare tax + Disability + Union dues