PAYROLL GLOSSARY
Net Pay
Definition: Net pay is the amount you actually receive after taxes and deductions are taken out of gross pay.
Net pay is often called take-home pay. It is the number most workers care about for budgeting because it reflects what lands in the bank account after federal withholding, FICA, state and local taxes, and any benefit or retirement deductions. Two employees with the same gross salary can still have different net pay if their pay frequency, W-4 elections, benefit deductions, or work state differ.
The IRS payroll tutorial draws a clean line between gross pay and net pay: gross is what you earn, net is what remains after deductions. That simple distinction solves many paycheck questions. If the paycheck feels lower than expected, the right next step is usually to break out each deduction line rather than assume the gross salary is wrong.
ExactTakeHome focuses on net pay because that is the number workers compare across states, offers, and withholding setups. But the answer is only as good as the gross-pay and withholding assumptions you put in.