Updated June 17, 2026
The main deductions taken out of a paycheck are federal income tax, Social Security tax (6.2%), Medicare tax (1.45%), any applicable state and local income taxes, and voluntary deductions such as health insurance premiums, retirement contributions, and flexible spending accounts. The combination is what turns your gross (before-tax) pay into your net (take-home) pay.
The standard deductions at a glance
| Deduction | Who pays | Typical rate (2025) |
|---|---|---|
| Federal income tax | Employee | 10% to 37%, based on bracket |
| Social Security | Employee + employer | 6.2% (employee share, up to wage base) |
| Medicare | Employee + employer | 1.45% (employee share, all wages) |
| State income tax | Employee | 0% to ~13%, varies by state |
| Local income tax | Employee | Varies; many areas have none |
| Health insurance premium | Employee | Depends on employer plan |
| 401(k) or 403(b) | Employee | Up to IRS annual limit |
Tax rates and limits vary by year and state. Always verify current figures with the IRS and your state revenue agency. This article is for informational purposes only and is not tax advice.
Federal income tax withholding
Your employer uses your W-4 form and the IRS withholding tables to estimate how much federal income tax to hold back each pay period. More allowances or a higher additional withholding amount on your W-4 shifts how much is withheld. If too little is withheld, you may owe a balance at tax time. If too much is withheld, you get a refund. See how federal tax withholding is calculated for the bracket details.
Federal income tax is a progressive tax, which means higher portions of your income are taxed at higher rates. However, your employer does not calculate each paycheck independently at your full marginal rate. Instead, payroll software annualizes your per-period earnings, runs them through the bracket tables, then divides the resulting estimated annual tax back down to a per-paycheck amount. This is why your withholding per check closely tracks what you will actually owe at the end of the year, assuming your income and W-4 stay constant.
FICA: Social Security and Medicare
FICA stands for the Federal Insurance Contributions Act. It funds Social Security and Medicare. In 2025 the employee share is 6.2% for Social Security (up to the annual wage base limit, which adjusts each year) and 1.45% for Medicare on all wages, with an additional 0.9% Medicare surtax on wages above $200,000 for single filers. See what FICA is and how it works for more detail.
Unlike federal income tax, FICA rates are flat percentages, not progressive brackets. Every dollar of covered wages below the Social Security wage base is taxed at exactly 6.2%, and every dollar of wages is subject to the 1.45% Medicare rate. Your employer matches both halves, contributing another 7.65% on your behalf without it appearing as a deduction on your stub.
State and local income taxes
As of 2025, most U.S. states impose a state income tax, though several do not, including Florida, Texas, Washington, and a few others. State rates range from less than 1% in some states to over 13% at the top bracket in California. Some cities and counties also collect their own local income taxes. Your employer should automatically withhold the correct state and local amounts based on your work location and any additional state withholding elections you file. If you live in one state and work in another, reciprocity agreements between some states may simplify your filing, but you should consult a tax professional for cross-state situations.
Voluntary and benefit deductions
Beyond taxes, you may see deductions for health, dental, and vision insurance premiums, contributions to a 401(k), 403(b), or HSA, life insurance, disability insurance, and union dues. Many of these are pre-tax, which lowers your taxable income and reduces federal and state withholding slightly. Here is how pre-tax and post-tax deductions differ:
- Pre-tax deductions come out of gross pay before taxes are calculated. Examples include traditional 401(k) contributions, HSA contributions, and most employer-sponsored health insurance premiums. They reduce the taxable wage base, so you pay less federal income tax, state income tax, and sometimes FICA.
- Post-tax deductions are taken after taxes are calculated. A Roth 401(k) contribution is the most common example. There is no immediate tax break, but qualified withdrawals in retirement are tax-free.
Worked example: a biweekly paycheck breakdown
Consider a single employee earning $55,000 per year, paid biweekly (26 pay periods). Their gross pay per period is $2,115.38. Here is an approximate deduction breakdown for one paycheck. These are estimates only; actual amounts depend on W-4 elections, state, and benefit choices:
| Item | Amount (estimated) |
|---|---|
| Gross pay | $2,115.38 |
| Federal income tax (approx. 12% effective) | -$185.00 |
| Social Security (6.2%) | -$131.15 |
| Medicare (1.45%) | -$30.67 |
| State income tax (est. 5%) | -$105.77 |
| Health insurance premium (est.) | -$90.00 |
| 401(k) pre-tax contribution (est. 4%) | -$84.62 |
| Estimated net pay | ~$1,488.17 |
This is an illustration, not a precise calculation. Use the Paycheck Calculator for a figure based on your actual pay, state, and elections.
What percent is typically taken out?
A rough middle-ground estimate for a single person in a moderate-income bracket is around 20 to 30 percent total withholding, including federal tax, FICA, and a typical state tax. Higher earners or those in high-tax states will see more withheld. Lower earners, especially those claiming the standard deduction, may see less. Use the paycheck calculator above to get a number based on your actual pay and state.
How to reduce the amount taken out
While you cannot opt out of FICA or legally reduce mandatory tax withholding below what you owe, there are legitimate ways to lower the amount withheld each paycheck:
- Increase pre-tax retirement contributions (traditional 401(k) or 403(b)) to reduce taxable wages.
- Elect a higher-deductible health plan paired with an HSA, funding the HSA pre-tax.
- Contribute to a dependent care FSA if you have qualifying childcare expenses.
- Review your W-4 and claim deductions for items like mortgage interest or large charitable contributions by using the itemized deductions worksheet on the IRS W-4 instructions.
Reducing withholding does not reduce your actual tax liability for the year; it only delays when you pay. Make sure your adjustments are grounded in real deductions you expect to claim. When in doubt, consult a tax professional.