Net Pay

Accounting Dictionary

Net Pay

Net pay is the amount the employees actually take home with them.

Net pay is computed by taking gross pay and deducting social security taxes, federal income taxes, state income taxes if any, state employee unemployment taxes if any, and other optional deductions such as medical/dental insurance, pension, cafeteria plan deductions, and/or contributions to charities such as the United Way.

Sign Up to Learn More!

Join our mailing list today to get notified of new discount offers, course updates, Roger CPA Review news, and more!