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Free employers’ 401(k)
withholding calculator

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    Pay Details

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    Exemptions

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    Federal Information

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    State Information

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    Locale Information

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    401(k) Information

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    Voluntary Deductions

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    Calculate Paycheck

Calculate your employee’s 401(k) withholding in seconds

Our 401(k) withholding calculator can help you get 401(k) deductions right by figuring out your employees’ take-home pay quickly and accurately. Simply click the button below, enter a few details about their plan participation information, and the calculator will do the rest of the work for you.

How much did your employee earn?

Gross Pay: This is the total amount of wages your employee earned before taxes and deductions are withheld.


For salaried employees, gross pay equals their annual salary divided by the number of pay periods per year. For hourly employees, gross pay equals the number of hours worked multiplied by their hourly wage.


(Don’t forget to add on any tips, commissions, or bonuses!)

Gross Pay Method: Is the gross pay amount based on your employee’s annual compensation, or by how many hours they worked in the last pay period?

Gross Pay YTD: Enter the total gross pay your employee has earned this year, prior to this paycheck. Normally, this can be found on the last pay stub.

Pay Frequency: How often do you normally issue paychecks?

Check Date: Enter the check date that should appear on your paycheck.

Is your employee exempt from any taxes?

Federal: In some cases, public and governmental employees are exempt from federal taxes. Check “yes” if your employee is exempt and Federal taxes should not be deducted.

FICA: In some cases, public and governmental employees are exempt from FICA. Check “yes” if your employee is exempt and FICA taxes should not be deducted.

Medicare: In some cases, public and governmental employees are exempt from Medicare taxes. Check “yes” if your employee is exempt and Medicare taxes should not be deducted.

Please enter your employee’s withholding information.

2020 W4: Would you like to use the 2020 withholding tables? Here’s an article that covers the 2020 W-4 updates if you aren’t sure.

Federal Filing Status: Select your employee’s filing status for federal withholding. This helps determine how much federal tax will be withheld.

Two Jobs: If the employee indicated that they have more than one job or are married and filing jointly with a working spouse, select Yes here.

Dependents Amount: Enter the amount your employee listed on Line 3 of their W-4, if any. This is where they claim dependents.

Other Income: If your employee listed another other income on line 4(a) of their W-4, enter the amount here.

Deductions: Enter any deductions that your employee listed on line 4(b) of their W-4, if applicable.

Additional Federal Withholding: If your employee has asked to have additional funds withheld from each paycheck, enter the amount here. If they have not, enter “0”.

Round Federal Withholding: Would you like us to round your employee’s withholding totals to the nearest dollar? (It’s not required, but it is permitted)

Now, add information for their state.

State: Select the state where withholding should be calculated. It should be the same state where the work was performed.

Now, add locale information if applicable.

Now, enter your employee’s 401(k) contributions.

Employee Contribution: Enter your contribution to your retirement savings plan. Next, choose whether this is a percent of your gross income or a flat rate.


For example, you could choose to have a flat $100 from each paycheck withheld, or you could select 5% of each paycheck to be withheld for your retirement savings plan. (You must enter a value in this box to make the calculator work properly)

Employee Contribution Type: Select your employee’s contribution type.

Older than 50? In tax years 2002 and later, the IRS has adopted a new rule allowing those employees over 50 to catch-up their retirement plan contributions. By selecting Yes to this question, your individual limit will be raised by the amount specified by the IRS for the year. By selecting No, your limit will be the same as all other employees.

Employer Contribution: Sometimes employers will contribute money towards an employee's retirement savings plan. If this is the case, enter this amount in the employer contribution of the calculator. Below, choose whether this is a percent of your gross income or a flat rate.


For example, you could choose to have a flat $100 from each paycheck withheld, or you could select 5% of each paycheck to be withheld for your retirement savings plan.

Employer Contribution Type: Select employers contribution type.

Contribution Limit: Enter the dollar value limit to which your employer will match your contributions to your retirement savings plan as certain employers will match all or a portion of your contribution.

Does your employee have any voluntary deductions?

Please add any additional deductions for items like health insurance, 401(k), HSAs/FSAs, or any other benefits.


Select type of deduction needed:

401(k)

Add deduction

HSA

Add deduction

Custom

Add deduction

Let’s finish crunching the numbers!

Click the button below to see your paycheck calculated.

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Updated: May 20, 2024

One of the best ways you can retain great employees, aside from paying competitive salaries, is by offering a 401(k) retirement plan. Employees can participate by contributing either a flat dollar amount or a percentage of their gross salary from each paycheck. Many employers match this contribution up to a certain amount as a perk, but the IRS does not require matching. There is some work involved in getting 401(k) deductions right, so we designed a calculator specifically to help you figure out your employees’ take-home pay quickly and accurately.

 

Just enter a few details about their plan participation information at the top of this page, and the calculator will do the rest of the work for you.

Why offer a 401k plan for employees?

As tax-deferred retirement accounts, 401(k) plans are beneficial to your employees because contributions are exempt from being taxed this year. Let’s look at a quick example of how this works.

 

Sally makes $5,000 a month. If we keep things simple and assume she is in the 20% federal tax bracket and pays no other taxes, her tax obligation would be $1,000.

 

But let’s say she decides to contribute 10% (or $500) of her monthly salary to her 401(k) account. Her taxable income now shrinks to $4,500, so her tax obligation also decreases from $1,000 to $900. That $500 she contributes monthly into her 401(k) account remains tax-free until she is eligible to withdraw it from her plan at age 59.5. (And adds up to a nice retirement fund!)

 

Note that the maximum amount your employees can contribute to their 401(k) plan does vary each year. For 2024, it is $23,000.

Are there different types of 401(k) plans?

In a nutshell, there are three different types of 401(k) savings plans that an employer can offer. These include traditional 401(k) plans, safe harbor plans, and SIMPLE plans. Below is a short overview of each, and we have an in-depth resource on the basics of 401(k) for small businesses that goes into more detail.

 

Traditional

A traditional 401(k) plan lets employees save a percentage of their pay through pre-tax payroll deductions, and employers can optionally match contributions. It is subject to non-discrimination testing known as ADP (actual deferral percentage) and ACP (actual contribution percentage), so to help make sure a company’s plan does not unfairly “tip the scales” in favor of their highly compensated employees.

 

Safe harbor

A safe harbor 401(k) plan skips the non-discrimination testing that comes with a traditional plan but requires employers to make fully vested contributions. It can be combined with other plans.

 

Simple

These are geared toward small businesses, designed for companies with 100 or fewer employees. It is not subject to testing, and combining this place with other savings programs is not allowed.

 

In addition to the resource mentioned above, you can see how the IRS defines each plan here.

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Does an employer have to match 401(k) contributions?

In most cases, employers are not required by law to match an employee’s 401(k) contributions, though many businesses choose to offer some level of matching even without a mandate in place. That’s because it can help a company stand out from the competition when it comes to recruiting top talent for open positions or encouraging high–performing employees to stay with your company.

 

Each company is different, and typical 401(k) matches can range from 50% of employee contributions to 100% matches. That said, the decision on whether to match as well as how much to match employee 401(k)s is entirely up to the discretion of each company.

Are employers required to provide access to retirement savings plans such as a 401(k)?

In recent years, some states have passed laws requiring employers to offer their employees access to retirement savings plans. However, this doesn’t mean a business has to provide a 401(k) plan for an employee to save money for post-work life. Furthermore, the requirements for how many employees a company must have before being required to provide access to a retirement savings plan vary by state.

 

For example, Oregon’s plan is an individual retirement arrangement (IRA, for short) that every employer must provide unless they already have a qualified plan in place.

 

On the other hand, Virginia’s auto-IRA only requires employers with 25 or more employees to provide their workers access to a retirement savings plan if they don’t already have one on the books. To learn more, see our guide to state-sponsored retirement plans.

Using the calculator at the top of this page, you can quickly determine an employee’s take-home pay once 401(k) deductions are accounted for. That said, there can be other scenarios where getting paychecks right requires a little more wrangling. For example, when an employee departs, you may need to issue a final paycheck. Or if you offer tipped wages or bonuses, you may need to add another step or two to your gross pay formulas for hourly and salaried employees. Below are some other calculators that you may find helpful down the road.

This calculator and others included on this page are for informational purposes only and to provide general guidance and estimates; it should not be relied on for tax, legal, or accounting advice. If you are unsure about your obligations or need assistance, you should consult your own tax, legal, or accounting advisor for formal consultation.

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