Why is my paycheck less than I expected?

Most of the gap is boring and legal. Some of it isn't. Here is how to tell which one you're looking at.

You did the arithmetic. Hourly rate times hours. Or salary divided by pay periods. Then the money landed and it was meaningfully less, and now you're staring at a pay stub trying to work out whether you've been robbed or you just don't understand payroll.

Usually it's the second one. Occasionally it's the first. Here are the eleven reasons, roughly in order of how likely they are.

The boring, legal reasons

1. You're comparing gross to net

This is the big one, and it accounts for most of the shock. The number you negotiated is gross pay. What lands in your account is net pay — after taxes and deductions. On a typical paycheck, the gap runs anywhere from about 20% to 35%, depending on your state, your income, and your benefits.

Our calculator works in gross, deliberately. Take-home depends on your W-4, your state, your health plan, and your retirement contributions — there's no honest way to compute it from a salary alone.

2. FICA, which you cannot opt out of

6.2% for Social Security (up to an annual wage cap) and 1.45% for Medicare (no cap). That's 7.65% gone before income tax has even been considered. Your employer pays a matching 7.65% you never see.

3. Income tax withholding is an estimate, not a bill

Federal (and usually state) tax is withheld based on the W-4 you filled out, possibly while distracted, possibly years ago. If it's set aggressively, your checks are smaller and your refund is bigger. That refund is not a gift — it's your money, returned late, without interest. If your checks feel too small, the fix is a new W-4, not a call to payroll.

4. Pre-tax deductions you forgot you enrolled in

Health, dental, vision premiums. HSA or FSA contributions. Your 401(k). These come out before tax, which is genuinely good for you — but they're real money leaving the check, and they often begin a month or two after you start, which is why paycheck three can be smaller than paycheck two.

5. Your first paycheck is almost always weird

Two things collide. Pay lag: most employers pay a week or two behind, so your first check may cover only part of a period. And you may have started mid-period, so you're paid for a partial one. First checks are routinely half what people expect. The second is usually normal.

6. Your bonus was withheld at a flat rate

Bonuses and commissions are "supplemental wages," and employers commonly withhold federal tax on them at a flat percentage rather than your usual rate. If your bonus arrived much smaller than expected, this is almost always why. It's a withholding rate, not a tax rate — the difference washes out when you file.

The reasons worth checking

7. Overtime that wasn't paid at the right rate

If you're non-exempt, hours past 40 must be paid at at least 1.5×. And crucially, the overtime rate must be calculated on your full regular rate — which can include nondiscretionary bonuses and shift differentials. Employers get this wrong constantly. Check the math, not just the hours.

8. Rounding that only ever favours the employer

Federal rules do allow employers to round time punches — but only if the practice is neutral on its face and averages out over time. A system that rounds your early clock-in up to the shift start, but never rounds in your favour, is not neutral. If you're routinely losing minutes and never gaining them, that's a problem. Here's the full picture.

9. Hours that didn't make it onto the timesheet

Pre-shift setup. Post-shift closing. The handover you do before you clock in. Answering messages at home. If it's work and your employer knows about it, it's generally payable — whether or not you were clocked in.

10. A deduction you never authorised

Uniforms, tools, cash register shortages, "breakage." Many states restrict or outright prohibit deducting these from wages, and almost all require your written authorisation. If a line item appears that you didn't agree to in writing, that is a same-day question for payroll.

11. Your rate was changed and nobody told you

It happens. Compare the rate on the stub to the rate you agreed. A cut applied to work you'd already done is essentially never legal. What to do about it.

How to actually diagnose it

Find your gross on the stub. Does it match hours × rate? If not, the problem is hours or rate — and that's a real issue, not a tax one.
If gross is right, the gap is deductions. Add up the tax lines and the benefit lines. They should account for the entire difference. If they don't, ask payroll to walk you through it.
Check the YTD column. A single stub is a snapshot; year-to-date shows whether something has been quietly wrong for months. Line-by-line here.
Ask. Most payroll errors are honest, and most get fixed within a cycle. Asking politely costs nothing.

General information, not tax or legal advice. Withholding rates, wage caps and state deduction rules change — check IRS.gov and your state labor department. If gross pay itself is wrong, that's a wage issue, and your state labor agency takes complaints for free.